Cafe chain in Indonesia plans big expansion with investment from Jay-Z and Serena Williams
Jakarta: On its first twenty-four hour period of business, Kopi Kenangan sold 700 cups of coffee. Within three months, it broke even.
2 years subsequently, it has 230 outlets across Indonesia, from Medan in North Sumatra to Makassar in Due south Sulawesi.
Mr Edward Tirtanata, CEO of this fast-growing java chain, decided right at the starting time that its java has to exist affordable in order to survive in the competitive marketplace.
At an average of 18,000 rupiah (US$1.30) a cup, the pricing of Kopi Kenangan is betwixt the street stalls' coffee of about 3,000 rupiah and international bondage' 50,000 rupiah.
"I used a uncomplicated logic in my pricing strategy when we commencement started three years ago.
"A nice cup of coffee toll between 35,000 and 40,000 rupiah. If you bought one cup a twenty-four hour period, that's 1.two one thousand thousand rupiah a month, which came up to thirty per cent of minimum wage in Jakarta.
"However, a cup of Starbucks in the United States for a month is simply 6 per cent of its minimum wage. At that place's a large difference. That'south why I decided to cost my coffee in a mode that a month of consumption will simply toll less than 10 per cent of our minimum wage," he explained.
The initial success has given the entrepreneur and his business partners backbone to dream big. They want to grow both in Republic of indonesia, which has a robust coffee civilization as the world's 4th largest coffee producer, and elsewhere in Asia.
To realise their expansion dream, they raised US$8 1000000 in seed funding and another U.s.$20 million in Series A funding.
But more impressive than that was getting Jay-Z and Serena Williams' venture companies on lath equally their investors.
With their funding, Kopi Kenangan is on the right runway to attain its ambition – one,500 stores in Indonesia and abroad by 2021.
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FROM TEA TO COFFEE
Mr Tirtanata, a Jakarta native, has always dreamed of post-obit his parents' footsteps to become an entrepreneur.
Afterward graduating from Northeastern University in Boston, Massachusetts, in 2010 with a degree in finance and bookkeeping, he returned to Republic of indonesia and dived right into the business concern arena.
"Back then I did many things. Nobody knows this, but I used to sell dress at Tanah Abang (biggest cloth market place in Southeast Asia).
"I also tried to first a consulting company," the 31-year-quondam said.
He tasted his beginning real success when he dabbled into nutrient and drinkable business with the opening of a tea lounge in 2022 named Lewis & Carroll, later on famous authors C. South. Lewis and Lewis Carroll.
Two years later, he partnered two of his friends Mr James Prananto and Ms Cynthia Chaerunnisa to beginning a java concatenation with 150 1000000 rupiah.
Their goal was to offer local high-quality coffee at a price cheaper than international coffee bondage.
For the make name, they settled with Kopi Kenangan, which translated into Coffee of Memory, with beverages cheekily named Memories of an Ex, Memories of an Ex who is Getting Married and Memories of the Past.
Mr Tirtanata knew the strategy worked when customers giggled as they scanned the carte du jour.
In addition to that, the partners decided that the gustatory modality and quality of the java had to be exceptional. Their signature cuppa would be milk java with palm sugar.
"If you lot are selling milk java, the milk is just equally of import every bit the coffee. Most likely, a loving cup of drink is 70 per cent milk. That's why I always choose the best milk," Mr Tirtanata said.
Their stores are compact with a small seating area as the concept was grab-and-become to cater to the needs of busy cosmopolitans.
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WINNING OVER JAY Z AND SERENA WILLIAMS
With 8 outlets under its belt a year after Kopi Kenangan started its operations, the business organisation owners began to plan for the next steps.
They had a coming together with local capital letter firm Alpha JWC Ventures and received U.s.a.$viii million funding two weeks later.
Why was Kopi Kenangan appealing for the investors?
"It is very uncomplicated. This business is highly replicable. It is going very fast. If you have a long-term view, you can see that this business organization is worth a lot in v or ten years.
"So why won't you invest in us while we are nevertheless very modest? That'due south how most start-ups pitch to venture backer.
"Our business is simple enough and our numbers are very robust and strong. That'south why they decided to invest in Kopi Kenangan," Mr Tirtanata said.
Looking back, it was his most memorable experience to date.
"I didn't call back I could become United states$8 million. Most of our friends just laughed at me when I said I wanted to inquire for The states$8 million … it was pretty cool," he said.
With the injection of the new funds, Kopi Kenangan opened more stores, grew its team and ventured into research and development.
In June terminal yr, Kopi Kenangan raised another The states$20 one thousand thousand in Series A funding through Sequoia Bharat, the investing firm that has backed Traveloka, Gojek and Tokopedia.
Every bit a result, other venture capital letter firms watching Sequoia India closely also noticed Kopi Kenangan. On the heels of the funding came an investment of an undisclosed amount from Arrive, a subsidiary of rapper Jay-Z's entertainment management company Roc Nation.
"Information technology reached out to the states via LinkedIn," Mr Tirtanata revealed.
Lawn tennis superstar Serena William's venture company Serena Ventures also became an investor on the invitation of Roc Nation.
Funding from the two celebrities' companies were a big heave to Kopi Kenangan's growth.
"In order to achieve our dream of 1,500 stores by 2022 and be a multinational brand, nosotros demand strategic investors, investors with a branding presence all over the earth.
"Jay-Z and Serena Williams accept congenital such an astonishing personal brand. Nosotros can learn a lot from them, so there is a lot of strategic elements why we picked Jay Z and Serena Williams every bit our investors," Mr Tirtanata said.
However, he was quick to add together that he has never met the superstars in person, just the representatives of their venture companies.
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"I But WANT TO WIN"
Kopi Kenangan harbours the ambitious plan of expanding to other countries, outset with Asia.
"If you go to Europe, America or Singapore, you see a cup of Coffee, a cup of Sumatra, being sold every bit premium coffee at cafes.
"Just you don't see an Indonesian way cafe away. So our vision is to consign a cup of Java or Sumatra to the earth as a brand, not as a commodity," Mr Tirtanata said.
He stressed that Kopi Kenangan is not a franchise. Each outlet is straight endemic past him and his partners.
Its rapid extension came with a swell need for manpower and the business organization partners are hoping to solve this by opening a barista academy.
Mr Tirtanata is besides aware that they need to continue evolving in social club to survive, hence constantly introducing new beverages is crucial.
In the next 10 years, he wants Kopi Kenangan to exist 1 of the most valuable food and beverage make in Southeast Asia.
"I suck at losing, I don't want to lose. I just want to win," he said.
Source: https://cnalifestyle.channelnewsasia.com/asia/indonesia-coffee-kopi-kenangan-jay-z-serena-williams-investment-196851
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