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Uncharted Ground With SSIR

Sep 7, 2021

For decades, smallholder farmers who produce the world’s supply of quality coffee in developing countries have barely earned enough to stay in business. Many have gone under. Millions of those still producing live in poverty and go hungry. Now climate change is threatening their livelihoods as well. The main problem is a supply chain stuffed with so many middlemen, each taking their cut, that only a fraction of the proceeds from pricey specialty-grade beans gets to the grower.

That was the picture in Nicaragua until Rob Terenzi, Noushin Ketabi, and Will DeLuca started Vega Coffee in 2013. On the face of it, their solution seemed simple: Enable the growers to process and ship roasted coffee directly to consumers in the US—thereby cutting out up to a dozen middlemen and retaining the earnings for themselves. It’s not that others hadn’t understood the problem before, but no one else had figured out how to solve it at scale. This episode follows Vega’s story, covering:

  • Rob’s initial discovery of the coffee growers’ dilemma (0:36);
  • the structural inequities of the global coffee trading system (4:37);
  • why Fair Trade and other “certified” designations fail to pull growers out of poverty (6:46);
  • Vega’s early challenges with roasting ovens (11:31) and transporting fresh beans to the US (13:08);
  • tapping Nicaraguan growers’ skills (16:13) and prioritizing women to promote gender equity (18:22);
  • growing the US customer base (22:05);
  • expansion to Colombia through a partnership with Mercy Corps (26:35);
  • and the promise of Vega’s model to rectify other broken supply chains of commodities around the world (28:52).

For the full transcript go to: