Iron Mule Inc. is fueled to expand one of its newer, social purpose infused coffee brands into the national grocery chain market.
Since its 2018 merger with Café Mulé, Ironside Roasting Co.’s four brands of coffee have been featured regionally in grocery store chains locally headquartered, including Albertsons, Boise Co-op and WinCo Foods. Café Mulé is a familiar name in the Treasure Valley startup ecosystem, having been a member of Trailhead Boise during the company’s development, and competed as a Trailmix 2020 finalist.
Accredited investors — Alturas Capital, VYNYL and others — are now supporting Iron Mule Inc. with $500,000 in seed-round funding to grow its Direct Access brand, while simultaneously pioneering an innovative business model approach within the coffee supply chain.
“We’re trying to get ‘trade’ out of coffee trade as much as possible,” said co-owner Matt Bishop. “It’s a different way to do business.”
Iron Mule Inc. co-founder Matt Bishop kneels next to bags of coffee beans that will be roasted for the Direct Access brand.
Direct Access coffee will financially benefit the coffee bean farmers
Dozens of large burlap-like sacks of green coffee beans sit in front of the commercial drum roaster, where they will either be roasted on their own or blended. A few pallets throughout the facility hold bags of beans from farmers specifically participating in the Direct Access brand. Once roasted and packaged through Iron Mule Inc., consumers will find the farmer’s story on each retail bag of Direct Access coffee.
Two bags of Direct Access roasted and packaged coffee beans are ready for retail.
Bishop explained the economics and supply chain process in the coffee industry force farmers to surrender ownership of their coffee beans at a price based on the commodity market, the effects rippling out and triggering less profit and limited (if any) business expansion opportunities for the farmers.
Coffee bean farmers — such as in Brazil (which dominates the market) Colombia and Guatemala — are often pressed to sell their beans immediately to coffee bean processors, often at a low price or even a loss. Coffee bean processors and exporters each take a cut of the sold retail bag of coffee. The farmer rarely (if ever) sees profit from a retail bag of his coffee beans sold at nearly $14 a bag. He sold his beans at almost a $1 or $2 a pound, with just a few cents of profit.
Additionally, many financial lenders in the above countries will not lend to coffee bean farmers at reasonable rates, Bishop said. Through Direct Access’ business model, the hope is for farmers to feel confident reinvesting in their farms.
Bags of green coffee beans are lined up in front of the roaster, operated by co-owner Colin Seeley.
Iron Mule Inc.’s control in the supply chain model will cut out the middleman wherever possible, serve as a lending source to the farmers and will return double to quadruple profits for the farmers, once their roasted beans are packed and sold to a grocery store. Iron Mule Inc. promises to keep their costs to farmers in the supply chain as low as possible.
Direct Access has its own website, directaccesscoffee.com, which includes a visual of the entire coffee bean journey, and the economic structure in the supply chain, offering transparency for stakeholders and consumers.
“That’s the purest form of what we’re working toward,” Bishop said.