What’s the story behind Pact?
I launched Pact out of my kitchen in late 2012. I’m a serial entrepreneur and I’d just sold my last company. My wife gave me the best advice. She said: “Stop trying to think like an investor and do the thing you love.” Counterintuitively, by following her advice, rather than worrying about commercial success, I found my idea. I knew I had to launch something to do with coffee – the flavour entices me. So, I got onto eBay and bought myself a shop grinder. We launched the business a month before my wedding in late 2012.
Why did you think the business could work?
I reached out to contacts in the coffee industry and realised that UK coffee drinkers have a bigger problem than running out. As a nation, we drink 70 million cups a day, but sadly a lot of it is still instant or stale supermarket coffee. In Balham, where I live, there are a few places that sell freshly-roasted coffee, but it’s hard to get. I wanted to save people running out of the coffee that they love.
I thought I’d build a business that was perfect for me and see if anyone agreed – I had a strong instinct that people want amazing coffee. I followed the idea of solving a problem and finding like-minded people.
Who is your target customer?
Anyone living in the UK who loves good coffee. All our coffee is sent out via Royal Mail first-class delivery, so if you put your order in before 1pm the coffee is with you the next morning. We have customers as far away as the Outer Hebrides who receive coffee from us. In London, we have recently been experimenting with cycle couriers as well – it makes sense and it’s better for the environment. On a good day we ship over 4,000 bags – around one tonne of coffee.
How is the coffee produced?
The coffee is roasted and ground in our Bermondsey HQ in London. All our green coffee beans are shipped directly from the farmers we work with around the world, and then we roast them and send them out straight away so they are as fresh as they can be. Right now we have some cracking Brazilian and Colombian coffees. We also source from farms in Mexico and Guatemala.
What are the biggest challenges you’ve faced with Pact?
One of the initial challenges to running a startup is achieving a lot with a small team and few resources. So you have to make a decision as an entrepreneur on whether you want to raise money and be a venture capital-funded business, or be an unfunded business that grows organically. I decided that Pact would be a funded business with faster growth and bigger ambition, but that isn’t something you can then undo so you have to be ready for it.
Do you think there’s an air of snobbery around coffee?
Yes, as we’ve grown one of the biggest challenges has been coffee snobbery. It can ultimately put people off drinking quality coffee because it makes them think it’s this inaccessible product. In reality it’s something that’s easy to make, easy to enjoy, and that is the message that we are trying to get out there.
Some people don’t think posh coffee is for them – my parents for example. My dad’s always drinking Nescafe and my mum has a Nespresso machine. But you don’t need to understand coffee like fine wine, it’s less of an investment. The price of the best coffee can be £6.95 for 250g.
What are your plans for the future of the business?
There’s limitless potential for growing Pact and always more work to be done on perfecting a completely flexible and delightful experience for our customers. There’s also the office market, international growth, different forms of coffee dispenser such as capsules and many other areas to think about. Right now, I can’t imagine wanting to do anything else but run Pact. I love coming to work every day now.
Do you do any brand marketing around big events?
Events like Christmas or Valentine’s are important moments in the year and we like to celebrate with them with our community. For example, for Valentine’s Day this weekend, customers who have a Pact coffee delivery due to arrive on Saturday will be receiving their coffee in a one-off red bag. And we’ve been running a really fun campaign to “share the love” via social media channels, which has had plenty of engagement on Twitter and elsewhere.
What advice would you offer to budding entrepreneurs?
I always say that ultimately you need to think with your heart, not your head. Don’t just think like a VC – do something you are completely passionate about. Think about the problem you are trying to solve and enjoy the process of solving it.
Stephen Rapoport is the founder of Pact Coffee
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