Fellow, a maker of specialty coffee gear, announced today they had raised $30 million via a Series B funding round led by Nextworld Evergreen.
The San Francisco-based company, which has made a name for itself with its somewhat pricey design-forward coffee-making gear, was started by founder and CEO Jake Miller in his dorm room at Stanford where he began work on a coffee steeper that raised close to $200 thousand on Kickstarter.
Since those early days, Miller and his team have launched a family of coffee and tea gear, ranging from French presses to kettles to insulated coffee mugs. The company, which has gained a following among baristas and celebrities for its sleekly designed Stagg EKG kettles (and also influenced a dozen or more knockoffs), also sells coffee beans via its website and has opened a flagship retail store in San Francisco.
I first connected with Miller in 2017 when he showed off the Stagg Kettle and pitched his company at the Smart Kitchen Summit. I sat down with him yesterday to talk about his company and plans moving forward.
The home coffee gear market has a rough space for some startups, yet Fellow has been able to grow. Why do you think you’ve had success while others have struggled or gone out of business?
I do think a big part of our success was our “failure” to raise venture capital back in 2013. With limited cash, we had to be incredibly thoughtful about our product roadmap. Not only did we have to understand the appeal and market size of our products, but we had to be very honest with ourselves about the likelihood of us actually delivering a product that customers would love.
For example, although a tiny market, we had high confidence in our ability to launch the best pour-over kettle in the world with a small team and limited resources. In 2013, if someone would have handed us $5 million I think there is a good chance we would have bit off too much and wouldn’t have been able to deliver. It’s exciting to sit here today with the experience of the past 9 years and now the confidence/ability to deliver on the big stuff moving forward.
What do you plan on using the funding for?
With the capital from the fund raise, we are going to build the team out further so we can run even faster in product development, coffee, and major distribution expansion, including international and our Fellow-owned retail stores. Our second store in Venice, CA opens in August.
The consumer hardware space has changed pretty dramatically since you launched almost 10 years ago, and crowdfunding is one of the aspects that has gotten harder (due to lots of high-profile failures). Would you crowdfund today if you were starting a company or take a different path?
I’m incredibly thankful to the thousands of backers who have supported Fellow through multiple products. The connections we’ve made with our early supporters is priceless. So yes, I think if done right, with the right intentions and expectations, I would absolutely use crowdfunding for a new company today. And, who knows, maybe Fellow goes back to crowdfunding for one of our future products! Even though we don’t need the cash for development today, the insights and feedback we get from our backers is essential to our success.
When you started designing your first product while still at Stanford, did you think you’d be building a consumer products brand long-term?
From day one, my goal was to launch a brand that had real permanence. I often talk internally about my dream of building a 100-year company. So, the desire was there. However, when I think back to 2013 at Stanford sitting in the Launchpad class at the d.School, my big dream was to have 10 employees who were passionate about product design. Now, all of the Kardashians have a Fellow Stagg EKG and it’s also being used by world champion brewers. Fellow today is far more than I ever imagined, but what is exciting is that I truly believe we are just getting started.
Do you see Fellow expanding beyond coffee/tea hardware in the future?
At some point, yes. But, not today. There is still so much more our customers are asking us to do within coffee. However, at some point in time our customers will ask us to move into other categories in the kitchen. We build beautifully functional tools for the home barista today, and we’re excited to build beautifully functional tools for other passions in the kitchen in the future.
You were a Smart Kitchen Summit startup showcase finalist in 2017. Do you have any memories from that experience you can share?
Yes! I remember pitching on stage alongside so many other great entrepreneurs. That was a real treat for me. Additionally, I remember seeing the other brands and products at the event and feeling inspired. Talking to other founders at SKS helped me to internalize the value that technology can create in the kitchen.
