Nguyen Coffee: Startup of the week

Active Fundraise. Angels Wanted

AuthorAuthor

Henry Head & Pitch Club
February 03, 2025

This week’s startup is Nguyen Coffee. An amazing early stage company with retail and online traction that is actively raising a 1.5M convertible note round. If you are a US accredited investor looking to angel or just want to evaluate a growing CPG company, read on.

The Company


Nguyen Coffee Supply, founded in 2018 by first-generation entrepreneur Sahra Nguyen, is America’s first specialty Vietnamese coffee company and has built a strong brand championing robusta bean coffee. They import through direct-trade relationships with Vietnamese farmers and roast in Brooklyn, New York. The company is on a mission to change the future of coffee through diversity, sustainability, and cultural integrity.

Product

Ground Coffee and Ready to Drink SKUs

Nguyen Coffee Supply offers ground coffee and ready-to-drink (RTD) beverages, focusing on robusta beans. The company is betting that robusta can become a powerhouse in the coffee industry, given its 60% less sugar, twice the caffeine, and higher antioxidants compared to arabica.

They launched DTC with whole beans in 2018, expanded into retail in 2021, and introduced their RTD line (Black, Coconut, Condensed Milk) in 2022, which fueled major growth. They also sell specialty brewing tools, including the phin, a traditional Vietnamese coffee filter.

Current State and Traction

Nguyen Coffee Supply has seen significant growth over the last two years, expanding its retail presence and proving demand for robusta-based coffee. While full financials aren’t public, here’s a look at their momentum:

  • Retail Presence: Now in 2,500+ stores, including Whole Foods, Target, H-E-B, Sprouts, Safeway, and Vons.

  • Wholesale Growth: Up 1,370% over the last two years.

  • Retail Expansion: Grew its footprint 640% YoY, reaching 9,600 Points of Distribution (POD) in 2,000 new doors, including Target, Albertsons, Kroger, Sprouts, and H-E-B.

Whole Foods Performance

  • Top 10 RTD coffee brand at Whole Foods and the only independent, non-VC-backed brand in the category.

  • The Condensed Milk SKU has outperformed every Chamberlain Coffee RTD SKU in a 52-week period.

  • Among the fastest-growing RTD coffee brands at Whole Foods nationwide.

Additional Highlights

  • Winner of BevNET’s Best of 2024 Rising Star Award.

  • RTD cost of goods (COGS) reduced by 37% in Q3 2024, improving margins.

What They’re Raising


Nguyen Coffee Supply has opened a $1.5M convertible note to fund their next big retail expansion.

  • $18M pre-money valuation cap

  • 10% discount and 5% interest rate

  • Status: $300K committed

  • Minimum Check: 25k

  • Deadline: February 20, 2025

PitchClub Thoughts

Rhian and I angel invested in Nguyen in 2022 and in this round. Here are some of the things we assessed.

Founder

We were looking for a trusted, talented founder with founder market fit. Sahra had this and more, and is one of those founders who seems to have more hours in the day than the rest of us. She’s scaled Nguyen year over year, is careful about not raising more capital than needed, and has turned the company into a growth powerhouse with just a team of 5. Simultaneously, she’s the face of the robusta coffee movement. PR and media isn’t always a proper indicator, but based on our own interaction with Sahra, investor updates, referrals, and results, she’s as strong a founder as they come.

Interview with Sahra Nguyen
Sahra recently sat down with Whole Foods Market CEO, discussing the growth of Vietnamese coffee and the future of the industry. Watch here: YouTube Interview

The U.S. ethnic food and beverage market is rapidly expanding, with the Asian category expected to hit $98.06 billion by 2028, nearly doubling from $49.27 billion in 2021. Likely driven by the fact that the US Asian population is the fastest-growing demographic in America.

This has led to a boom of strong CPG brands focused on this shift, and we have seen strong fundraising momentum in adjacent categories:

  • Xiao Chi Jie, a frozen dumpling brand, raised $10M in Series A

  • Sanzo, an Asian-inspired sparkling water brand, also raised $10M in Series A, further validating consumer appetite for new beverage categories.

Exits

We, of course, assessed what a potential exit or positive outcome might look like for a specialty coffee brand. We felt The coffee industry had a strong history of high-value acquisitions, especially for brands that carve out a unique niche in the market, such as Nestlé acquiring a 68% stake in Blue Bottle Coffee for $700M in 2017 or Keurig Dr Pepper invested $300M for a 33% stake in La Colombe Coffee Roasters in 2023.

We saw exit potential in full acquisition, strategic investment from a large CPG player, or an international growth play.

Investment Type

CPG is HARD. We could (and probably should) write a whole newsletter edition on how brutal the CPG market has been the past 5 years. CPG businesses are capital-intensive, can be low-margin, and are often highly competitive. Especially recently:

  • The cost of acquiring customers has grown

  • Retail expansion can come with huge cash flow challenges

  • CPG venture market has cooled

We feel Nguyen will be able to scale smartly, ride the growing demographic trends, and balance retail expansion with strong unit economics, but you might come to a different evaluation.

Sustainability

Rhian also was interested in the sustainability play of Nguyen. Robusta generally is naturally more resilient to climate change, requiring less water and pesticides, and grows at lower altitudes—all factors that could make them a more sustainable option as global coffee production faces climate challenges.

Connect


If you’re an accredited U.S. investor, please respond to this email, or reach out to me on Linkedin, for the full pitch deck and an introduction to Sahra Nguyen.

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If you run or work at, or have invested in an early stage startup that’s looking for early adopters, investors, or just want to get the word out there, please share your story with us, and we would be excited to partner with you.

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Weekly Wit

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— Mark Twain

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