Entrepreneur

How This S'porean Grew Her Coffee Subscription Startup Into A Regional E-Coffee Brand

“Sustainability and profitability are complementary,” Faye Sit surmises of Hook Coffee, in her interview with Vulcan Post.

In the span of just four years, the co-founder of the e-coffee brand has evolved from a two-man startup into “Singapore’s largest and Southeast Asia’s leading online coffee company”, she said.

Hook Coffee sells an average of 10,000 products per month. The e-coffee’s total revenue run rate jumped by 10 times between 2016 – 2020, hitting 100% month-on-month growth in Hong Kong, their latest market.

The secret? A socially and environmentally responsible business that does not compromise on its values.

Traveling For The Greater Good

A long-term coffee drinker, Faye’s love for speciality coffee was cemented when she watched the 2014 documentary “A Film About Coffee.”

Image Credits: Hook Coffee

Faye admiringly described “the love and care placed in the processes, preparations, traditions … that come together to create the best cups.”

However, Hook Coffee would not be what it is today without Faye’s passion for empowering the underprivileged.

Inspired by her travels abroad, the entrepreneur recounted a pivotal meeting with a 10-year-old girl in Shanghai.

(She said) the city would never have a place for her, regardless of how hard she studied … poverty meant destitution and inaccessible opportunities.

– Faye Sit, co-founder of Hook Coffee

Fuelled by a desire to make an impact on the world, Faye embarked on a series of travels researching sustainability and engaging in voluntary work.

On a research project in Latin America, Faye noticed how poor farmers were struggling to sustain their livelihoods and falling into a cycle of debt.

“We can’t save the environment without fighting poverty, and vice versa,” Faye explains. “I felt compelled to make a difference.”

Premium Coffee Delivered To Your Doorstep

Faye’s answer was Hook Coffee. In partnership with her co-founder, the brand was created to promote socially-conscious business practice and the art of home-brewed specialty coffee.

Hook Coffee offers the widest variety of freshly roasted specialty coffees from around the world. The diversity of choices include quirkily-named flavours like Rum Baby Rum and Kopi Sutra.

Their business model is a simple one: simply order coffee online and a package will be delivered to your doorstep.

There’s also an opt-in, no-commitment subscription service for coffee to be delivered at varying intervals.

Hook Coffee personalises the customer experience by introducing coffee match quizzes and brew guides so customers know best which coffee to go for.

Their coffee are sold in three varieties: whole or ground beans, drip bags, Dolce Gusto Compatible Capsules, and Nespresso Compatible Pods.

All speciality coffee sold on Hook Coffee are ethically sourced and sustainable, and coffee farmers get to earn up to 10 times the market price.

Good Business Pays

Surprisingly, the Covid-19 crisis saw a spike in the demand for Hook Coffee.

Image Credits: Hook Coffee

More people are consuming coffee at home now…We have also noticed that our subscribers have been increasing their subscription delivery frequency.

– Faye Sit, co-founder of Hook Coffee

Subscription services might be a particularly lucrative business model during the pandemic. Under lockdown orders, people choose delivery over stepping out of their homes to procure consumer goods.

However, online coffee subscription services are dime a dozen in Singapore and most use the same sustainable ethos to appeal to target demographics.

Companies like Nylon Coffee Roasters, Arrow Coffee and Perk Coffee offer similar subscription packages at the same price point.

Perhaps the key to Hook Coffee’s commercial success is its ability to make specialty coffees — a niche product — appealing to all.

The personalised customer experience journey on the website lowers the threshold for customer acquisition. Specialty coffee doesn’t seem quite so bourgeoisie when there’s a “coffee match” quiz gamely proffering choices to suit one’s tastes.

Hook Coffee also possesses the first-mover advantage. The brand claimed the title of the first e-coffee company to introduce coffee subscription services to Singapore.

In addition, Hook Coffee split its marketing between commercial and corporate clientele, tailoring the subscription service to suit professional tastes.

Perhaps because of its successes, Hook Coffee is able to contemplate expanding into new markets despite the Covid-19 pandemic. “Our mission is to make great and responsible coffee accessible to all,” says Faye.

The brand currently ships internationally, with a “strong footing” in Singapore, Hong Kong, and Malaysia.

Ethical Coffee For Millennials

What makes Hook Coffee so successful may be its ability to tap into a key coffee drinking demographic: millennials.

Image Credits: Hook Coffee

According to a Vice Media report, one in two of their millennial-dominated audience would always choose a brand that supports a cause.

Hook Coffee’s niche product also means that it doesn’t have to compete with megaliths like Starbucks or Coffee Bean.

Specialty coffee comprises only three per cent of the global yield, Faye explains, while larger brands derive their coffee directly from the commodity market.

Today, coffee is one of the most highly traded commodities after oil. An average of 95,000 60kg bags of coffee in Singapore were consumed in 2018, according to a report on Statista.

This means that Hook Coffee situated itself strategically — in the right place, for the right people, at the right time.

Ultimately, Faye attributes Hook Coffee’s success to its core ethos.

A combination of staying true to our brand and mission, quality products and services, leveraging technology, and a little bit of luck has earned us thousands of loyal customers and gotten us to where we are today.

– Faye Sit, co-founder of Hook Coffee

“I have also been very fortunate to have a few mentors who are free-spirited entrepreneurs themselves.”

Her mentors include Wong Toon King, a Singaporean serial entrepreneur; Michel Lu, a F&B entrepreneur and veteran; and Hoe Yeen Teck, founder of Helpling.

What’s Next?

Currently, the entrepreneur divides her time between Hook Coffee and pursuing a doctorate degree at the Lee Kuan Yew School of Public Policy.

Image Credit: Support Startups

“I have a reliable and independent team at Hook Coffee, and this affords me time to work on my doctoral research,” Faye says simply.

The decision to pursue a PhD was inspired by the same drive to start Hook Coffee, revealing to Faye the “importance of strong governance and political will.”

Whether it’s teaching in developing countries or doing pro-bono entrepreneurship mentoring, Faye spends her free time giving back to the community.

She remains open about what will happen next. “I’m always on the look out for new opportunities to learn, to create, and to make an impact.”

Featured Image Credit: Singapore Management University Blog

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