Coffee delivery service Pact is 33-year-old founder Stephen Rapoport's fourth business venture, and by his own testament, his biggest. Back in 2012 the company consisted of just one coffee-enthusiast -- Rapoport -- grinding, packing and shipping bags of coffee to customers by hand. "I drew the logos on in felt tip, sealed the bags with hair straighteners and queued up at my local post office to send them out," he told WIRED.co.uk. Staff numbers eventually had to be upped significantly, to cope with the surge in demand: more than 30,000 cups of Pact coffee are now drunk everyday in the UK, and the business is growing 20 percent every month. Of the company's reason for being, Rapoport explains simply: "Coffee tastes best when it's freshly roasted. And if you don't happen to live next to a speciality roaster, then it isn't that easy to get your hands on fresh roasted coffee, as and when you need it." That is, until Pact came into the picture.

Founder: Stephen Rapoport


Launched: September 2012

Headquarters: London

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Staff: 36

Funding: £2.5m from MMC Ventures, Connect Ventures, Active LLP, Taavet Hinrikus (TransferWise), Ian Hogarth (Songkick), Robin Klein (Index Ventures) and Rowan Gormley (Naked Wines)


What problem do you solve?

We stop you from running out of coffee that you love. We want to get people drinking better coffee by making incredible, freshly roasted beans accessible to everyone. Part of that is about providing fresher, higher quality coffee direct from source that tastes better. Along the way, we hope to educate people about how to make a great cup of coffee at home.

Where did you get the idea for the business?

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I woke up one Saturday morning frustrated that, once again, the coffee jar was empty at just the wrong time. I was sick of having to go to the corner shop and buy a sub-standard, main-brand coffee that wasn't even fresh. I used to hate running out of coffee that I love and thought other people might feel the same way.


How do you make money?

Our revenue is already in the millions so we're making money and ploughing it back into the business to fulfil our growth ambitions.

We have some recurring revenue from being a subscription business, but we know we can't rely on that. We're very aware of the need for flexibility, so if we can keep people in the sweet spot of 50g-200g of coffee in their cupboards at all times -- whether in central London or the Outer Hebrides -- then they never have to go without.

That's actually a lot harder than it sounds, but we're getting there.

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Who do you view as your competitors?

There's absolutely no joy in winning a customer from a great speciality roaster already out there -- like Monmouth Coffee for example. Their coffees are just as good as ours. Our main competition is Tesco and other supermarket coffees, and of course getting people to upgrade from instant. For us, it's about helping to get the UK drinking better coffee, and if we can help grow the speciality coffee industry in the process, then that's great too.

What sets you apart from them?

Coffee on the supermarket shelves can sit there for months, just going stale. We put the roast date on all our bags and guarantee that you will get your coffee through the letterbox within seven days of roasting -- that's a difference you can taste. And Pact offers a completely flexible, approachable and frictionless experience, which is particularly important for a subscription-based business. We're investing in the expertise and technology to get better and better at that.

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How would you sum up your company ethos?

We've worked really hard on getting our brand and company values right. It comes down to three things -- putting customer needs at the heart of everything, staying open and honest at all times, and asking customers what we can do that would make them more happy. If we're able to do that one thing to make their experience better, then we do it. And if not, then we explain honestly why we can't.

What's the biggest misconception about your business?

That we're a rigid subscription and that we're just for coffee snobs.

What pushed you to stop talking about launching a startup and actually do it?

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I'd started a company before, but starting Pact was different. I was looking for a new venture and I've always loved great coffee.

It made a lot of sense to combine the two.

What has been the most challenging time for the company?

Between our seed round and series A there was a time where we really weren't sure if we were going to be able to raise additional funding. You make a decision as an entrepreneur whether you want to be a funded business with that scale of ambition, or an unfunded business that grows organically. I decided that Pact would be a funded business with faster growth and bigger ambition, but being VC backed is obviously something that you can't undo. When we had a series A backer fall through at the 11th hour, at a time when we really needed the cash, that was pretty tough.

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How did you overcome that?

By being really open and honest with the team. Telling everyone what was going on. Keeping the faith. Keeping the vision, and remaining resilient to the problem. I didn't let it damage my energy for solving the problem (raising more money), and I went out and got there in the end with what actually turned out to be a much, much better series A investor in the form of MMC Ventures.

Do you have any advice for dealing with potential investors?

Make sure they understand your vision deeply enough to really, truly challenge you on it. Because if they don't then you're just raising money from them and not getting any other insight beyond that.

What is the best piece of advice anyone has ever given you?

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When I was thinking about starting a new business my wife told me to stop thinking like an investor, and just do the thing you love.

And I have. Pact is driven by a passion and love of coffee, of flavour, of delighting customers. When you're working on something you're passionate about, I find it helps to really focus on the product.

Which business person do you most admire and why?

Sunni, the owner of my local coffee shop (Camden Coffee House in Balham). He takes enormous pride in every aspect of running his business and it's just a pure pleasure to go and be a customer. He focuses on the small details, removes ego from every decision and has a fantastic business as a result.

What is your biggest barrier to future success?

It could well be coffee snobbery. We're fighting quite hard to break through the noise from the 'wax moustache coffee snobs' who are ultimately putting people off drinking quality coffee because they think it's this inaccessible product. In reality it's something that's easy to make, easy to enjoy. There shouldn't be any anxiety or worry when you're making it. If the coffee snobs win then it'd be a massive shame for humanity! And for the coffee farmers, who should be able to charge more for a higher quality of bean.


Where do you see the delivery/fresh produce industry in ten year's time?

I hope the quality and provenance zeitgeist will continue and win out, so that we see a lot more value in the producer's hands.

Rather than the retailers and distributors. Then the people that really add the value will be rewarded, and ultimately consumers will win as a result.