STiR coffee and tea magazine

8 STiR coffee and tea | 2024 Issue 6 (December / January 2025) By Dan Bolton Q A QA Thaleon Tremain, Co-founder and CEO of Pachamama Coffee STiR: Congratulations on two decades of successfully operating a venture that few predicted would succeed. It's now worth many millions of dollars. Thaleon Tremain: Coffee is a great business, and cooperatives are a great business model. If you look at what's important in any business, it's what the consumer is demanding. We know what consumers want. You could see that well over 20 years ago, with the emergence of the Fair Trade movement, organics, and other movements. Consumers want to be closer to the producers. So, I don't think what we did is particularly hard. What was hard was doing it without any capital, without any cash. Most people in my position wouldn't have hung around for 20 years. The members of these smallholder farmer cooperatives invested a lot in Pachamama in the early days. We turned that coffee into cash, paying the bills and a little more. Now that we've proven self-funding can be done, I don't see why many problems can't be solved. There's plenty of money in the world. We managed to get this far without any of that. Once we get some cash investment, watch out—this thing will take off. The flip side of succeeding without outside investors is that we're 100% farmer-owned. All that equity is still in the hands of farmers, and if they want Thaleon Tremain co-founded Pachamama Coffee and was named CEO in January 2003. Now celebrating its 20th Anniversary, Pachamama is North America's first coffee roaster and retailer wholly owned and governed by farmers. Coffee growers financed the venture's humble beginning by investing green coffee to launch the brand in 2006. Together with Tremain, they devised a cooperative, self-funded means of empowering small-scale farmers. Pachamama's innovation was setting farmgate prices to ensure a firm financial foundation at origin, capturing value along the entire coffee supply chain mirroring verticals owned by the multinationals. Pachamama is owned by 400,000 growers in Peru, Nicaragua, Guatemala, Mexico, and Ethiopia. Headquartered in Sacramento, Calif., Pachamama's farmer-owners at COCLA cooperative recently opened the brand's first overseas retail shop in Cusco, Peru. In 2024, Pachamama received the Sustainable Food Gold Award in the Sustainability Pioneer category, recognizing visionaries and trailblazers. Tremain, a soft-spoken, business-centric visionary, explains that Pachamama's heart is the farmer-owned supply chain that rewards growers with the price they set. to, they can go out and sell parts of that at a high price. Because, to your point, the company's worth a lot of money. There may not be an exit strategy, but it's worth a lot, and we can bank on that in other ways. And we can get money flowing back to the producers through higher profits. STiR: Physical assets like the roastery and retail shops are visible, but one of the ways Pachamama has prospered is by identifying and enhancing coffee's intrinsic value, such as organic cultivation verified by third-party certifiers, practicing gender equality, investing in education, and ecological awareness. What rings the cash register? Thaleon Tremain: There are two things: Access to the consumer, so distribution, having cafes and outlets, and the means to get coffee from the farm directly to the consumer. The second is brand marketing. When somebody says, 'Well, I just love that brand" it makes that coffee worth five times more than I would normally pay for it. I think it boils down to branding and marketing and distribution and image. Go to the supermarket, and you've got a choice of maybe 10 or 20 different coffees. That's a lot. I think at the consumer level, packaging is what sells. Done well, you get the whole story, branding, and certifications. It's organic certification for us. I definitely think there's value there. And finally, the con- sumer is starting to see and pay for that value. The stories retailers tell are farmer stories to support their retail value. Retail brands often sell to large corporations and then to mega corpora- tions down the line. When you ask what made that brand, where's the value in the stories they're telling? Very often—not always, but very often—it's an origin story. If that's the case and they are selling coffee based on the farmer and making the world better for farmers or a healthier environment, I think the producers need to be true partners in that story. STiR: Peet's Coffee & Tea sold for $977 million in 2012. The new owners bought Intelligentsia and Stumptown and paid $340 million for Caribou Coffee. Five years later, Nestlé paid $425 million for a controlling interest in Blue Bottle. These third-wave boutique roaster retailers offered distinctive products and championed innovations like nitro and cold brew but sourced and roasted their coffee from the exact coffee origins as Pachamama. Thaleon Tremain: As you mention these companies, the one thing they have in common is coffee. Blue Bottle Coffee, Stumptown Coffee, and Pachamama Coffee. What differentiates these companies is their name and what that brand represents in your mind (and in reality), right? Yeah, well, they were really selling a brand, you know, just like Stumptown did. It may look simple, but it's not. You want to tell a story around something that differentiates you, so you Pachamama Coffee board of directors with CEO Thaleon Tremain. From left to right Carlos Reynoso, Merling Preza, Thaleon Tremain, and Vladimir Vivanco. Photo courtesy Pachamama Coffee

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