Former Dairy Farmers Become Billionaire With Red Hot Coffee Shop Dutch Bros
People take their coffee very seriously, and that's good news for Dane and Travis Boersma. The brothers are third-generation dairy farmers from Oregon who were looking for a side gig back in 1992. They settled on starting their own coffee business for a number of reasons, but being able to listen to music while hanging out with friends was a big part of the decision to go with coffee.
The brothers combined their savings and bought a coffee cart and espresso machine and set up business in downtown Grants Pass, Oregon. They named their company Dutch Bros.
Over time their coffee business expanded rapidly.
Sadly, Dane Boersma died in 2009 after a two-year battle with Lou Gehrig's disease. As of this writing, Dutch Bros. has 471 coffee shops throughout Oregon, Washington, California, Idaho, Nevada, Arizona, Utah, Colorado, New Mexico, Texas, and Oklahoma. The first Dutch Bros. franchise launched in 2000. In the 12 months that ended June 30, the company had a net income of $6.5 million on sales of $414.5 million. That's up from $186 million in revenue in 2018.
Dutch Bros. made its IPO on the New York Stock Exchange on September 15. By the end of the first day of trading, shares had surged by 60%. At that level Dutch Bros. had a valuation of $5.6 billion and made Travis Boersma, 50, a billionaire with a $2.3 billion net worth.
The Dutch Bros. IPO was the first by a company based in Oregon since 2004 and it was the largest in the state's history.
Travis marked the occasion of the IPO of his company by showing up to the floor of the New York Stock Exchange wearing a Rage Against the Machine t-shirt, a backward baseball cap, and flip flops.
The coffee business in the U.S. is pretty cutthroat with the main competition coming from Starbucks, Coffee Bean and Tea Leaf, Peet's, and Dunkin'. Dutch Bros. set itself apart from the rest of the competition by creating unique drinks. The company actually sells more cold drinks than hot and promotes a culture called "Dutch Luv." The average employee turnover rate in the coffee business is more than 100%. At Dutch Bros., it's 40%. In fact, back in 2019, the "broistas" at Dutch Bros. started a Venmo campaign to raise money for one of the coworkers to attend college. Another thing that sets Dutch Bros apart from its competition is the way it handles its franchises. The company doesn't sell franchises to outsiders, it awards them to employees who work their way up through the company and impress Boersma. Dutch Bros. will only sell franchises to people who have worked with them for at least three years and Boersma will buy back any franchise that fails to live up to his standards.
In an interview with KDRV NewsWatch 12, Boersma called the explosive IPO "a mindblow, man." He went on to say:
"Who would have thought that you could take a coffee cart in a small little town like Grants Pass — really do what you hear about as you grow up as a kid, you know, the American dream — and actually go out and pull it off. We've defied the odds, and I couldn't be more ecstatic about where it sits and what's happening… you know, it's surreal."
Boersma relinquished the CEO job at Dutch Bros in February and installed beverage-industry veteran Joth Ricci (Jones Soda Co, First Beverage Group, Stumptown Coffee Roasters, and Adelsheim Vineyards) in his place. Boersma retained the executive chairman role.
ncG1vNJzZmivp6x7pLHLnpmroaSuu6bA1qipraBemLyue8Crq6KbnJrAcK7IpaOip56WtrOxjKecsKtfm7yzucSrZJ2ZmafGbrLAq6SeqqNir6avzqacZpqZobmqu82aoKudXay2tbSMq5ydZZikwW6vzp%2Bdnp1dqLWwvIydrK2bmGKvs7vSaA%3D%3D