The story of the Green Coffee Company isn’t just about beans; it’s about the notable influence of visionaries and the high-net-worth individuals in shaping its destiny.
In the world of business, unconventional paths often lead to remarkable triumphs. For example, Spotify revolutionized music by shifting from purchasing to subscription-based streaming, transforming industry norms and user experience. Similarly, Airbnb, Tesla Motors, Netflix, Uber, and WhatsApp, all took unconventional paths in their respective industries. GCC’s journey was uniquely about attracting HNWIs.
The norm in the world of business has traditionally been centered around seeking funding through conventional means such as bank loans, venture capital firms, or initial public offerings (IPOs). These methods, while effective, often come with certain strings attached, such as giving up equity, adhering to stringent investor demands, or facing high interest rates.
Operating from the US and Medellin, Colombia, Green Coffee Company is a component of The Legacy Group, which, as an alternative asset manager, pursues impactful investments in Latin America.
When the company set out to raise its initial capital in 2017, it didn’t follow the conventional route of approaching large venture capital or private equity firms. Instead, it tapped into a unique source of funding—individual accredited investors, often referred to as high-net-worth individuals or HNWIs.
Back then, this approach was quite a rarity. The founders chose individual investors over institutions for early-stage financing, and this unconventional choice has turned out to be one of the company’s greatest strengths.
What drives these individual investors to ventures like the Green Coffee Company? It’s the hunger for unique early-stage opportunities coupled with an unwavering demand for high returns. These investors aren’t content with ordinary; they seek ventures with the potential for substantial gains. And they’re keen on business valuations that make sense, not inflated figures.
As U.S. citizens operating in Colombia, the founders of the Green Coffee Company took this unconventional funding route and turned it into a grand success story. What began as an idea transformed into a coffee empire—Colombia’s largest coffee producer, no less.
But this journey required more than just the initial funding. The company’s growth demanded continuous support, and the founders raised over $60 million from more than 450 individual accredited investors. This June, they secured an additional $25 million in Series-C funding, a testament to their unique approach’s sustainability in the ever-evolving landscape of Latin American funding.
The success of the Green Coffee Company also reveals a broader appetite among high-net-worth individuals—an appetite for global alternative direct investments. These investors seek opportunities that allow them to invest directly in companies, breaking away from the traditional investment models of private equity and venture capital firms. The “blind fund” concept doesn’t appeal to them; they want to see where their money is going, to be part of the narrative.
It’s not just about the financial aspect. These investors are sophisticated, strategic thinkers. They understand that to yield high returns, a business must have a solid plan, while analyzing valuations, assessing expected financial performance, and digging deep into due diligence. It’s about making educated, calculated decisions rather than unfounded leaps of faith.
To win over these investors, companies must demonstrate the potential for superior returns. This becomes especially crucial in alternative investments, where total returns matter the most. While these investments might be less liquid compared to publicly traded securities, investors are willing to take the plunge if they see a “liquidity premium”—a promise of greater returns that compensate for the lack of immediate liquidity.
The Green Coffee Company’s story reflects this thirst for returns. It showcases how even in emerging markets or early-stage ventures, high-net-worth individuals are willing to invest if the business presents a reasonable path to substantial upside—typically around 30-50% annualized returns.
Furthermore, the current wave of environmental, social, and governance (ESG) considerations hasn’t changed the essence of capitalism for these investors. They view ESG practices as a means to an end—a way to secure a business’s long-term success and growth. However, they also recognize that solely emphasizing a company’s ESG characteristics isn’t enough; it’s the overall investment proposition that matters.
In this journey, communication plays a pivotal role. High-net-worth individuals want transparency, accountability, and real-time engagement. They’ve had their fill of standard quarterly reports that lack depth. They demand interaction, the chance to ask questions, and receive instant answers. In the world of HNWIs, over-communication is a virtue, not an exaggeration.
The main motive of this story is to showcase how high-net-worth individuals, with their unique demands and strategic mindset, can rewrite the destiny of a business. Their influence isn’t just about capital, but about the the visions they shape, the journeys they embark upon, and the stories they write.
