Hook Coffee raises $250,000 more in two funding rounds from tech, finance investors

They plan to expand in three markets overseas.

When Singapore-based online coffee startup Hook Coffee secured a quarter of a million dollars of fresh funding, their eyes quickly darted past Singapore’s shores with a plan to expand in three markets overseas and double their team size over the next two years.

Faye Sit, one of the two co-founders of Hook Coffee, explains that it was only natural for their fast-growing company to strike while the iron was hot. In just one and a half years since it was founded after clinching a SPRING ACE Startups grant of $50,000, Hook Coffee has gained more than 10,000 subscribers and sold more than 500,000 cups of coffee, growing by 20% month-on-month.

“We identified a key pain point in the market: Specialty coffee has been inaccessible in terms of affordability and convenience, while affordable and accessible coffees such as those found in supermarkets or coffee chains are of poor quality and do not reward coffee farmers fairly,” says Sit on what has made Hook Coffee one of the hottest coffee brands in Singapore at the moment.

“Hook Coffee solves this problem by sourcing sustainably grown and ethically produced coffees, roasting them locally in Singapore for optimum freshness, and delivering them direct to customers’ mailboxes for the ultimate convenience.”

Sit and her co-founder Ernest Ting, who finished Masters at the London School of Economics and coffee and roasting barista diplomas at the London School of Coffee, were tapping into the rising discernment among Singapore coffee drinkers.

Euromonitor’s "Coffee in Singapore" report released earlier this year notes that "With growing affluence and greater exposure to premium coffee, consumers tend to be more discerning of the type of products they consume, such as the quality and the ingredients.” The coffee industry is forecasted to grow at a CAGR of 1% in retail volume terms.

Hook Coffee is also savvy in listening to what customers want. The company built a recommendation engine that it claims is 95% accurate, powered by the answers users provide to a few questions while creating an online user account. Feedback is also gathered after the ordered coffee beans are delivered.

“When our customers rate the coffees they receive, we get to know their sensory taste profile, preferences, and lifestyle habits even better. The subscription service allows us to do this across time and everyday we are collecting and analysing data to build a better product and service for our customers,” says Sit.

Not all coffee drinkers are connoisseurs, which is where the recommendation system also comes in handy. The website suggests what coffee to order based on how a user brews their coffee as well as their sensory taste profile.

Hook Coffee flavors tickle the palate, too. Its dessert-inspired coffee range that lend hints of Peanut Butter & Jelly, S'mores and Speculoos, among other flavors, are a hit. Coffee is also freshly roasted and delivered direct to customers' mailboxes within seven days of roasting.

Little could Sit and Ting imagine that they will be soon delivering coffee abroad with very recent memories of packing and shipping at a small attic of a 50’s shophouse in Jalan Besar.

“The shophouse was charming and cosy — the only problem was, we were overloading it with a coffee roaster, heaps of inventory, and other machineries and furniture. The old wooden floors wobbled and creaked, and so did the narrow staircases that we had to climb and descend while carrying 60-70kg sacks and tubs of coffee,” recalls Sit.

“There was a silver lining; all that physical labour meant we could save on gym memberships.”

The pair’s hard work has been paying off, but their extra effort to source ethically and responsibly, and to provide customers transparency and traceability, seems to be pushing the brand ahead of the pack. The seeds of of a socially responsible business began when Sit flew to Latin America for fieldwork where she realised the impact a socially responsible startup could bring to farming communities.

“Specialty coffee should be about more than just better coffee, but also about bettering the lives of farmers and the environment,” she says.