Sign up for Funding Circle newsletter!
Get our latest news and information on business finance, management and growth.
Updated: March 27th, 2020
Starting a coffee business is not for the faint of heart. It will bring blood, sweat and tears (plus, a lot of caffeine).
Yet, there’s still something that makes the pursuit worthwhile despite being strapped for cash, overworked and underpaid, running on a un-human amount of sleep, and grappling with the constant uncertainty of your decision to start something of your own.
And as the saying goes, hindsight is 20/20. So, what better way to truly learn what it takes to successfully build a coffee business then to turn to those who know best.
We asked individuals behind some of America’s best cups to share what they wish they knew before opening their coffee shops, or other caffeine-infused operations. The result is 34 pieces of advice that all aspiring entrepreneurs would benefit from knowing.
From mistakes made to tricks of the trade, you’re bound to discover at least one nugget of wisdom that will save you time, money, energy and quite possibly your sanity—or all of the above.
“I wish I had become more of a handyman before launching my business.” – Peter Brown, Six Shooter Coffee (Cleveland, OH)
“I wish I knew… to hire a good bookkeeper! It’s my #1 piece of startup advice. They say “what gets measured, gets done”. Well, if you can’t trust your numbers then you can’t really measure your business. Good information is critical to making good decisions. We’ve spent the better part of a year cleaning up the mistakes we made when managing our own books.” – Matt Bachmann, Wandering Bear Coffee (New York, NY)
“I wish I had known that you could lease equipment, and they come with service contracts.” – Jonathan Rubinstein, Joe Coffee (New York, NY)
“I think the thing I wish I had known was how many little decisions I would have to make! What kind of light bulbs, how many chairs? What kind of wood do we use, how far apart should the lattice be spaced? Do we use brown screws or black screws? What kind of patio furniture do we buy? The list goes on and on; I can’t even remember them all anymore!”- Elle Taylor, Amethyst Coffee Co. (Denver, CO)
“Starting an online business with no previous experience with an online store, I wish I had known more about operating tools like Shipstation that are available to help small businesses. Learning that there are tools to help online stores get off the ground and find competitive pricing was game changing. We could have saved a lot of time and money if we knew that from the beginning! We would have also benefitted from choosing a large online store platform from the beginning. BigCommerce and Shopify are worth the learning curve in the long run.” – Lacie Mackey, Caveman Coffee Co. (Albuquerque, NM)
“I wish I had known to work with an accountant BEFORE the first dollar was ever put into a bank account.” – Colby Barr, Verve Coffee Roasters (Santa Cruz, CA)
“The total lack of interest contractors have in keeping to a schedule. Time estimates are virtually useless. If you’re going to hire 3rd parties, contracts need to be made as airtight as possible before work begins. Include ratchets for failure to deliver on time or not meet specific project requirements. Clearly define milestones along the way with explicit penalties. The more granular you can get contractors to be in the breakdown of their bids, the better. This helps you understand the cost of work for each piece of the project and detect arbitrary markups.” – Matthew Tervooren, Pourt (New York, NY)
“I wish I had known how important taking the time to eat proper meals and exercise could be for managing stress. When you are run down or not feeling well, no one is going to take care of the business for you. It is imperative you do all you can to try to stay as healthy as possible.” – Caroline Bell, Cafe Grumpy (New York, NY)
“It’s so hard to narrow it down—I wish we would’ve known how much we truly didn’t know! Equipment, supplies, accounting, payroll, HR best practices, tax laws, scheduling, ordering and even water filtration systems. The list can go on forever.” – Janine Awan, Woodcat Coffee Bar (Los Angeles, CA)
“I wish I knew that when we first got our La Marzocco machine in the shop, it was probably not a good idea to take 10 double shots of espresso a day to “train” as a barista!” – Adam Kallen, JANE Motorcycles (New York, NY)
“I wish I would have known that people will drink specialty coffee above 14th Street I spent years listening to naysayers who said you had to be in The Village or Brooklyn—I wish we had opened earlier on the UES, Midtown, UWS.” – Jonathan Rubinstein
“I could probably write a book or two on the question that you have posed…There are several things that I wish I had known prior to launching our business, most of them relate to proper budgeting and truly understanding the City (Minneapolis) processes. In Minneapolis, we were hit with what is referred to as a SAC fee. This stands for (Sewer Access Charge) it how the city or Met Council rather keeps up with the cost of the sewer and water system in the Twin Cities. For us being a “change of use” designation for the space that we chose we were charged an extra $4000.00 that we did not budget for at all.” – Caleb Garn, Five Watt Coffee & Big Watt Bev Co. (Minneapolis, MN)
“When we opened Slow by Slow, we did it with a very optimistic budget for our tenant improvements and equipment costs. As it turned out, we were able to do all of our work and purchase top of the line equipment under the budgeted amount without much issue. What we should have known before that, was the costs that would come through getting permitted with our city government. The amount that was needed for impact fees and building permits cost nearly as much as the work itself, and though we were able to make that work, it definitely would have been helpful to get more in depth with the city of Boise on how much converting our space to foodservice would cost. In the end, it was fine, but it would have been nice to estimate that cost in order to secure more operating cash for our business. I recommend spending a good amount of time with your architect and your city planning department prior to securing funding or signing a lease on a space that may end up costing more than you know.” – Joe Shafer, Slow by Slow (Boise, ID)
“The other piece of advice I would give to all budding entrepreneurs is that whatever dollar amount you think you need to get everything done… double it! The most expensive thing that you will ever deal with in your business is “Time” and it will cost you a lot of money.” – Caleb Garn
“There’s a lot that goes into making a business successful. But if you aren’t financially smart, it will be doomed. We had to do a lot of course correcting, optimizing, and leak plugging since we opened. I wish I had done a lot more research into costs, the profitability of certain offerings, and overall, a more refined business plan.” – Marco Suarez, Methodical Coffee (Greenville, SC)
“I wish I would have prioritized having working capital in the bank when we opened to have room to grow once the dust settled after our first 6 months.” – Lindsay Windsor, Lord Windsor Coffee (Long Beach, CA)
“I wish I’d known that we could roast our own coffee, rather than buying from out of state for the first 6 years—We would have provided opportunities, expanded outside of NY and had a wholesale program much earlier.” – Jonathan Rubinstein
“When I started Bootstrap, I wish I had known to not underestimate our growth. I had started with a small, 6-pound batch size San Franciscan. I was forecasting slow, but steady growth at the beginning. Very quickly, I found we were roasting 30+ batches (10+ hours) per day! It took us a few months to secure and install a larger roaster, and those few months of being “at capacity” slowed our growth. We couldn’t really take on more customers during that time (even though they were there waiting for us) as we didn’t have the staff to handle them and couldn’t roast for them!
Obviously, you can swing the other way and have too much capital tied up in a roaster that’s too large right off the bat, and then you are in a position where you have to grow (and quickly). That’s a problem, too! There’s a balance, of course, but I think it’s much better to be a bit over-prepared and grow into your capacity than to play “catch-up.” Lesson learned.” – Micah Svejda, Bootstrap Coffee Roasters (St. Paul, MN)
“I wish I had known that an expensive accountant that is good is much cheaper than a cheap account who is bad.
We had two accountants that were really horrible and cost us dearly. We got audited, and rightly so, by the IRS for mistakes both had made. It ended up being far more costly in both time and money than bucking up for a quality accountant from the get go. We have a really good one now.” – Geoffrey Meeker, French Truck Coffee (New Orleans, LA)
“I wish I had known the importance of hiring great people—even if it meant spending a bit more than I was comfortable with. Bad employees end up costing a business much more in the long run.” – Josh Zad, Alfred Coffee (Los Angeles, CA)
“I know it feels responsible to buy a used espresso machine–don’t! You don’t know the service history of that machine, what water it was connected to, how it was stored…. resist the urge! Pay for the security and peace of mind of a warranty and service contract with a respectable technician. And always, always use properly filtered water.” – Christopher Feran, Phoenix Coffee (Cleveland OH)
“I wish I had known how vital it was to learn and grow from other leaders earlier in my career. I wish I would have started asking questions earlier and spent time really developing myself. I can’t imagine how much farther along I would be if I had spent intentional time developing my skills as a leader.” – Stevie Hasemeyer, Arcade Coffee Roasters (Riverside, CA)
“I wish I’d started out with a more focused grassroots marketing effort. The allure of a business is that you open it and people shall come “just because,” kind of like the field of dreams. But, it’s just that: a dream. People do business with people. When establishing a new business, you want real life people to interact with you and your products, and they aren’t always going to come to you. Find networking groups, find business mixers, and find coffee lovers. Have them try your stuff, and more importantly, have them able to buy it on the spot (if they won’t, that is a red flag). This experience invaluable and should be constantly focused on. It will help get the word out, it will help you better develop everything from pricing to marketing campaigns, and it will help you make partnerships with other businesses in the community. Get video customer testimonials. Get referrals. Get business owners willing to share their customer and employee bases with you.” – Alex Moen, Match Made Coffee (Oceanside, CA)
“I wish I had known to put more stock in the feedback we get from our customers right from the start. I had lots of my own ideas, but the customers (for the most part) have an even better idea as to what is providing good service to them.” – Will Shurtz, Methodical Coffee (Greenville, SC)
“In the beginning, we spent a lot of time on every step of the process from sales lead and producing our coffee to SELF-distributing our coffee. We were very neurotic about each step (kinda still are!), but at some point we realized we had to scale with the right partners, removing ourselves from the distribution business. We were wary about working with large scale distribution because we thought we’d lose our high-touch customer experience with our amazing clients. We wanted great people serving great coffee to great clients. We got to the point where we were constraining ourselves with our own self-distribution because we had so much else to focus on in order to grow RISE—while it was a great customer experience doing self-distribution, we inked deals with distribution partners after a ton of screening and due diligence. Overall, we wish we had known how amazing our distribution partners would have been from the beginning if we found the right ones. No regrets but great learnings!” – Hudson Gaines-Ross, RISE (New York, NY)
“If I had to do it all back knowing what I know now, I wish I had started with a proper board of directors or advisors. A good board can guide you to make smarter and more efficient decisions, which is key in a competitive market.” – Steven Sutton, Devoción (New York, NY)
“There can be a temptation early on to believe that everything is riding on your shoulders, from ideation on to opening day. And while, absolutely, everything ultimately comes back to you as the business owner, there’s a tremendous amount of freedom to be found in offloading certain responsibilities onto other qualified partners. Whether it be your accountant, architect, coffee roasters or another partner, find people you can trust, allow them to do their job, and focus your energy on the areas where you can have the greatest impact.” – Jonathan Riethmaier, Mammoth Espresso (New Orleans, LA)
“I’m kind of an obsessive planner, so I really did a lot of research and got the necessary experience to run a coffee shop and restaurant before I opened my own. I definitely recommend that, as there have been few “on paper” surprises veering from what my expectations were. But one thing that I didn’t consider was how isolating it is to be at the top. An owner is under a lot of pressure and is constantly putting out fires and managing personalities. It’s important to have a mentor, a good friend, or even a therapist, to be able to share what you’re going through, too, and hopefully get some guidance on difficult decisions.” – Camila Ramos, ALL DAY (Miami, FL)
“I wish I knew that when you’re starting out, it feels like for every two steps forward, you take one step back. That’s just the name of the game—it’s all about cultivating patience and celebrating those little victories!” – Noushin Ketabi, Vega Coffee (Estelí, Nicaragua / New York, NY)
“I wish I had known that there’s no such thing as a silver bullet. You often think, “if we could only do this”, or, “if we could only buy this equipment”, everything will change. None of those will save you. It’s always going to be the accumulation of many things that move needles.” – Marco Suarez, Methodical Coffee (Greenville, SC)
“This was a tough question to answer as I tend not to regret or look back on decisions. I look at all as just a part of the process of starting a business.
However, to help young entrepreneur…I think I’d say, I wish I would have thought “big” from the start. In other words, it takes just as much energy and effort to think big as it does to think small.” – Casey Goch, Shreebs (Los Angeles, CA)
“This might sound weird, but I don’t have any “I Wish” moments.
I feel everything we set out to do, we did it with a sound mind and it was all part of the experience.” – Mark Vollmer, Theory Coffee Company (San Antonio, TX)
“I wish I had taken the time in the beginning to celebrate all the wins, even the small ones, along the way instead of moving on so quickly to the next issue or task at hand.” – Chris Campbell, Chameleon Cold Brew (Austin, TX)
“This is a question that is fairly easy for me to answer after giving it a few minutes to think about. For both Darko and I, partnering meant that we could both play up to our individual strengths which means wherever he ends, I begin. Darko, thankfully, has years of knowledge in GC work (General Contracting) along with a plethora of friends in every aspect of building any brick and mortar place. My background is management, sourcing, and roasting which is what I bring to the table and makes our partnership work, albeit, not always perfect, but that’s a part of the journey.
The one thing I’d say that we definitely did not know is that regardless of how good or excellent your product is, if you do not have your brand, marketing, and execution all on point, it could mean the difference between success and falling behind while everyone blows past you. Our business model is much different than our contemporaries.
We built Metric on a bag of coffee, a coffee roaster and a few handshakes with local partnerships so our growth while painful at first, helped us become the brand we are today. Still, we are not by any means a large or even medium company, but because we have allowed ourselves to grow at a rate that we are comfortable in, it has allowed us to make mistakes that we can easily bounce from and most importantly, learn from.
So to answer your question, if there was one thing that I wish I would have known, my answer would be (as faux pa as this will sound) is that I am glad that I went into this not knowing the outcome. Setting expectations can be good for some people, but in my journey, any expectation that I have set before me, almost always never materializes the way I intended it to. In conclusion, my advice to anyone and everyone who wishes they would have known something after the fact is this: Don’t be afraid to make mistakes, and should you need to make a big decision that costs you money, don’t be afraid to look like a fool and save yourself from financial heartache.” – Xavier Alexander, Metric Coffee (Chicago, IL)
Samantha Novick is a senior editor at Funding Circle, specializing in small business financing. She has a bachelor's degree from the Gallatin School of Individualized Study at New York University. Prior to Funding Circle, Samantha was a community manager at Marcus by Goldman Sachs. Her work has been featured in a number of top small business resource sites and publications.