Kaffelogic founders John Robson and Chris Hilder with the nano 7 home coffee roaster. Photo / Nick Beadle
Jane Phare talks to two South Island men, both in their 60s, who turned a home coffee roasting machine, developed from a popcorn maker, into a multi-million-dollar business.
Dunedin coffee aficionado Chris Hilder was always bothered that he couldn’t roast his own coffee at home. He could buy roasted coffee beans, grind them and make his morning “pour over”, but there was always a missing link.
“Roasting the beans was the one part of my morning ritual I wasn’t responsible for.”
So 10 years ago he started experimenting with a popcorn machine. Then he bought another, and another, but the result was haphazard – delicious one day, burnt the next.
The issue was consistency so Hilder, a software engineer with a background in robotics, set about developing software to control the airflow and energy input, the two components essential for the perfect roasting of green coffee beans. Friends were so impressed with the prototype roaster they suggested Hilder should try to manufacture and sell it.
Roll forward a decade, and Hilder and his business partner Christchurch businessman John Robson are now the owners of Kaffelogic, a company that produces thousands of the Nano 7 benchtop coffee roaster. Turnover is now in the millions of dollars with growth doubling each year.
It’s been a steep learning curve for Hilder who sought start-up advice in the early stages and credits support from the Dunedin business community to help turn an adapted popcorn machine into a commercial success. Learning that the worldwide coffee community don’t miss trends on social media, Hilder used New Zealand crowdfunding platform PledgeMe to raise capital to make the first 100 Nano 7 machines in 2018. That was when Robson, who has been involved in the coffee industry since 2005 importing coffee makers, grinders and accessories, heard about the roaster.
“I had been searching the world for a small coffee roaster because I believed home roasting was going to be the next big thing,” Robson says.
Like fresh coffee grounds and hot water, it was a match made in caffeine heaven. Robson had the knowledge and contacts of the worldwide coffee community, and marketing experience. In turn he describes Hilder’s development of the Nano 7 as a great Kiwi story of invention and entrepreneurial spirit.
“To my mind, Chris is a James Dyson from Dyson vacuum cleaners. He nailed it, absolutely nailed it.”
It was Hilder’s visit to Christchurch during a Nano 7 demo roadshow that convinced Robson it was a winner. Here was a benchtop roaster no bigger than a small blender, with software sophisticated enough to allow the user to roast perfect coffee without any experience. It can roast as little as 50gms, about two double shots, and up to 200gms, around 10 double shots. And each time, a perfect result.
“I immediately knew that it was going to be a world-beater. I’d never seen anything like it in all my years in the industry,” Robson says.
“You can use this product out of the box and roast incredible coffee in 10 to 12 minutes.”
Robson came on board in 2018 as a co-founder, helping with refining the design, packaging and securing an agent in Australia. They sold 200 Nano 7s at $1550 each. But apart from the sales, the worldwide coffee community was starting to take notice with news of the little benchtop coffee roaster from New Zealand spreading quickly on social media.
In 2020 they launched a Kickstarter crowdfunding campaign and secured Swiss-based distributor Roast Rebels to service western Europe.
With traction in the European market, their biggest problem was keeping up with demand. Inquiries were coming in from all over the world but they couldn’t build the machines quickly enough despite scaling every year.
In 2021 they took over the manufacturing from a contract manufacturer, renting a building in Dunedin’s Castle St. They started with four staff and rented out the other half of the building. Within a year they needed the whole space.
Then in 2022, in Robson’s words, “It just went ballistic.” Using crowdfunding platform Indiegogo, they launched the Nano 7 on the US market.
Within hours of going live they sold more than $100,000 of product. Within a few months they had hit nearly $1 million in sales.
To date they’ve sold 10,000 of the roasters with stockists in 16 countries across New Zealand and Australia, Europe, the Middle East and the US. This year they’re expecting to sell 7000 machines and Robson doesn’t see that slowing down any time soon. Now, with 25 staff, they’re bursting out of Castle St and, committed to manufacturing in New Zealand, intend to move to premises three times the size in Dunedin early next year.
The crowdfunding platforms have worked well for Kaffelogic, Robson says, reaching a large target audience quickly. In addition, champion baristas and coffee farmers around the world have started to use the Nano 7 to roast small batches of coffee beans. A barista competing in the 2021 World Coffee Championships in Milan won the Brewers Cup award using a Nano 7 and since then two other baristas have won international coffee awards in 2023 and this year.
News travels fast in the coffee community and those awards gave the Nano 7 the social-media traction to reach the top echelons of coffee experts around the world.
“At the very highest level coffee has become very sophisticated similar to the wine industry.”
Now the roaster is turning up on coffee farms in places like Ethiopia, Guatemala, Chile and Panama, used by farmers as a sample roasting tool.
“It’s because of the preciseness of the software that controls the roast,” Robson says. “You can replicate from roast to roast and get exactly the same results.”
Hilder and Robson, both in their 60s, are now looking to develop new roaster models including a more sophisticated machine with higher-spec features for the professional coffee market. And they’re also eyeing the mass market, a simpler machine, still high tech and able to be controlled from a mobile phone, but without the $1550 price tag.
And they also want to help coffee aficionados source beans from coffee farms around the world that they wouldn’t otherwise have access to. Robson says they won’t be importing the beans themselves, they’ll stick to making roasters.
But using high-tech and their contacts with coffee farmers, traders and suppliers, they want to set up an online network connecting coffee lovers with, for example, a farmer growing extraordinary coffee in Ethiopia, and to be able to buy some of those beans.
“Some of the very best coffees sell for hundreds of dollars per kilo at auction around the world,” Robson says. “You’d never see that coffee in New Zealand. We want to change that.”
Jane Phare is a senior Auckland-based business, features and investigations journalist, former assistant editor of NZ Herald and former editor of the Weekend Herald and Viva.
Auditors PwC: Cited disruptions to operations from that IT upgrade.