Company Overview –
Vera Roasting Company has created a craft coffee, CoffVee, infused with resveratrol, the all natural antioxidant found in red wines.
|Name: Vera Roasting Company||Minimum Raise: $25K|
|CEO: Mark Galvin||Maximum Raise: $100K|
|Company Founded: 2015||Structure of Raise: SAFE|
|Location: Portsmouth, NH||Valuation: $2M Valuation Cap, 15% Discount|
|Crowdfunding Portal: Wefunder||Minimum Investment: $100|
|Crowdfunding Link: https://wefunder.com/veraroasting|
|Positives||Risks and Reservations|
|Highly qualified founders in both the business and technology.||The founders currently are not focusing their efforts full time on this venture.|
|This team has been able to generate significant traction early.||The companies competitive/comparative advantage rests solely on their potential patent’s ability to protect from competitors and industry incumbents carrying producing and offering a similar product.|
|The solution addresses a massive and growing market, not only nationally but also worldwide.||Management would benefit from acquiring advisors and additional leadership with experience in bringing food based products to market.|
|The product is well suited for building a recurring membership-based model and additionally, has inherent upside through JV partnering/OEM opportunities. These sorts of strategic partnership possibilities may also present M&A – liquidity potential.|
It has been found that people who drink red wine regularly and responsibly lead healthier lives with less disease due to the beneficial ingredient resveratrol. To gain the full benefits of resveratrol one should consume it every day. Not everyone likes red wine or drinks it every day but many adults drink coffee multiple cups of coffee each day.
Vera Roasting Company has created an infused coffee that contains resveratrol to provide all the same health benefits as drinking a glass of wine
They plan to ramp up their subscription model and land more national accounts.
Up until recently, Vera Roasting Company focused on direct-to-consumer sales through their website. Through the website, customers could place one time orders or set up a subscription service. Their coffee retails for $14.95 per bag or $12.95 per box of k-cups. As of Q3 2016, they have gross margins of 51%. Recently Vera Roasting Company has been aggressively pursuing traditional, brick-and-mortar retail channels.
- Via earned media, the company quickly sells CoffVee to all 50 states within 2 days
- CoffVee is available at local retail markets in NH, ME, & MA
- Awarded U.S. patent for unique process and composition of matter
- Partners with the Vitamin Shoppe, Baltimore Orioles and United States Coast Guard
- Invited to participate in Whole Food’s regional showcase
*Source: Company provided on crowdfunding campaign website
Senior Management Team
|Mark Galvin||Glen Miller|
|Position:||CEO||CTO & Founder|
*New England Innovation Center has 28.93%
This venture founded by two gentlemen who appear to be experts in their respective disciplines. This has undoubtedly been the basis for their impressive and early traction. The company is entering a new phase which would benefit from the company leadership being solely focused on the company’s growth. The CEO’s shares are held via proxy through his NEIC. While this equity is of significant value, the fact the CEO holds shares indirectly, combined with his lack of full-time focus on the venture presents an issue to explore further.
Industry: Food & Beverage
TAM (Total Addressable Market): $48B (U.S.)
*Souce: Portal Page under details
Driving Trends: growing at 4% annually
*Souce: Portal Page under details
The coffee industry in the United States is a fragmented and mature yet growing industry. There are significant opportunities to partner with large industry incumbents. Further, there are significant trends in the adoption and pursuit of healthy foods. The product is consumed daily and that presents significant opportunities in recurring and membership-based sales.
This is the first company that has figured out how to infuse coffee with the health benefits of resveratrol and has filed patents to protect its technology.
Vera Roasting Company doesn’t have any competitors that produce a coffee with resveratrol and its unique health twist. They do realize their biggest competition is other premium coffee brands that consumers enjoy drinking.
*Source: Portal Page
Revenue to date: $108,380
Revenue Last Fiscal Year: $76,233 (through November 2016)
Previous Funds Raised: $0
Use of Funds
- Open a new pack and ship facility
- Marketing, advertising, and customer retention
- Create a buffer in their cash position to be able to invest in working capital
The most likely exit for this company would be an acquisition by large industry incumbents. The value of such a transaction would be predicated by the company traction and the nature of the protection ultimately granted by its patent(s).
Recent Acquisitions in the Field
|Date||Company Acquired||Acquired By||Amount|
|Dec 7. 2015||Keurig Green Mountain||JAB Holding Company||$13.9B|
|Oct 6, 2015||Stumptown Coffee Roasters||Peet’s Coffee & Tea||Unknown|
Expert Opinion Summary
This company has proven with its early traction, that there is valuable interest from an array of customers and partners. When the leadership makes this venture its sole focus, the question will not be profitable/successful or not, it will be at what scale will this company be successful. The operations for this type of venture are not difficult.
In addition to ensuring competitive advantage through IP protections, the venture will be most successful by creating and managing a world-class brand. In the process of building this brand, the company should continue to develop strategic partnerships with more distributors and vendors in both the coffee and health foods industries.
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