Brewbike

BrewBike is changing the way students get coffee, replacing campus coffee shops with high quality, convenient, brand driven offerings. By appealing to university stakeholders across the board, the Company will double its number of active campuses in 2019, with much more to come. Midwest Scout Dan Eidell sat down with Founder and Chief Growth Officer Lucas Philips to discuss the inspiration, initial success, and road ahead. 

Icy Climate; Iced Coffee

“Don’t talk to me until I’ve had my coffee.” Students and professionals alike have uttered the same phrase for decades, if not longer. Yet, even as consumers benefit from unprecedented numbers of beverages from which to choose, coffee remains a staple; over 60% of Americans drink coffee daily. Dig deeper and the story becomes more complicated. Consumption of gourmet coffee (which includes premium varieties, cold brew, blended drinks, and espresso drinks) rose to 60% of all consumption last year. Moreover, despite their affinity for boutique coffee shops and subscription boxes and “grabbing coffee” as a social or professional outlet, Millennials and Gen Z consume less coffee than prior generations. For younger consumers – such as those found on university campuses – coffee is less about a jolt of caffeine than it is a function of quality, price, and convenience.

I and many others in my generation don’t buy Starbucks coffee because they prefer a less corporate brand that resonates with them in a more personal way.

– Lucas Philips, Founder & Chief Growth Officer

Launched on Northwestern’s campus in 2016, Brewbike sets out to deliver on all three points  – quality, price and convenience. By combining convenient offerings (their namesake bike), compact coffee stands, and delivery, BrewBike hopes to free students from the duopoly of low quality cafeteria coffee and saturated Starbucks lines. Now live on two campuses (Northwestern and the University of Texas) with two more scheduled for the Fall, the company is improving the student experience one cup at a time.

For Students, By Students

For BrewBike, students are not merely consumers; they are the local experts that bear responsibility for campus launches, growth, and success. Every student is a paid employee, and succession plans mirror most other on-campus organizations. Though BrewBike maintains a core team, local operators are the company’s growth engine and play a vital role in BrewBike’s success or failure.

Empowering students to earn money and learn how to operate a business while in college. That’s not Starbucks’ brand. That’s not Dunkin’s brand…We present a more compelling brand case and with that, we believe we can succeed.

– Lucas Philips, Founder & Chief Growth Officer

At any given school, full deployment is projected to include a combination of lean retail stores, bikes, and high-density delivery locations. At the same time, the unique features of campus life pose specific challenges from sourcing to staffing that most companies do not face. Recognizing these issues, BrewBike’s core team (shown below) retains control of certain key points. HQ, for example, manages roaster relationships and ships beans to its campus teams for grinding and selling. Randy Paris, the company’s CEO, sets the company’s vision and leads fundraising, partnership outreach, and other high-level functions. Hernandez, the COO, is an “operations guru” who thrives in high-level situations and when working with campus teams. Matros’s experience and advice, meanwhile, is invaluable given his experience building hundred million dollar brands. Together, the team takes special care in recruiting and designing their campus launch teams. According to Philips, “coffee is as much about the brand and the logo on the outside as it is the product on the inside.”

Finally, BrewBike offers universities – necessary partners for on-campus ventures – a clear value proposition. The company offers universities a tangible example of their commitment to entrepreneurship. According to Philips, “if we do an amazing job [launching on campus], the university will love it because [BrewBike is] teaching students about entrepreneurship in a very public way on campus.” In the event of a successful launch, BrewBike is positioned to resonate with almost every constituency on-campus, from professors to prospective students.

From Partnerships to Profits

Bringing high quality coffee to campuses nationwide is no easy task. Fortunately, BrewBike has identified ideal locations and forged strategic partnerships to facilitate growth. Despite proven ability to endure Chicago winters, the company believes its operation is better suited to large universities in warm climates with flat campuses. These conditions allow their business to operate for more of the year.

Yet, an evolving competitive landscape could force changes to this strategy. For the moment, the Starbucks, Dunkin Donuts, and other brick and mortar establishments on college campuses are not BrewBike’s immediate competition. Against these legacy retailers, convenience and quality, differentiate the brand. The more immediate challenge, however, comes from other ready-to-drink coffee brands – La Colombe, Blue Bottle, Intelligentsia, etc. – sold on campus. Against these competitors, building a strong brand with devoted followers is key. Two planned expansions in 2019 – the University of Miami (FL) and Texas State – will test the company’s model and target campus.

Those launches could also prove vital to validating the company’s scalability. BrewBike has forged a partnership with the higher education wing of Compass Group, the world’s largest food service provider (Chartwells). Chartwells operates on over 1,000 campuses in the United States, all of which could someday feature BrewBike.

This is not SaaS and is not as scalable as Uber. But, for a food concept that involves owning and operating retail, it’s very scalable…Above all else, we’re building a coffee brand for young people.

– Lucas Philips, Founder & Chief Growth Officer

To get there, the question is fundraise (and follow a traditional venture timeline), or franchise? Lucas, for one, believes BrewBike to be a venture backable business. They may never become a unicorn, but neither will Magnolia Bakery, which now exists in almost 200 locations and a dedicated consumer following. For investors, that idea sounds as good as their morning coffee.