The on-demand coffee delivery company is successfully utilizing a business model that doesn’t always translate.
Ever since Uber became consumers’ go-to app for catching a ride, companies have been trying to replicate its business model. But even though the “Uber for X” industry is increasingly crowded, it isn’t always successful.
In today’s technology and convenience driven society, there’s an Uber for everything. From food delivery and maid services to doctors and valets, there’s a seemingly endless list of apps offering to deliver a product or service to customers’ doors in 30 minutes or less. But despite the business model’s popularity, it’s taking some heat as startups are struggling.
Take SpoonRocket, a brand that cooked and delivered its own meals rather than being a middle-man for restaurants. After raising $13.5 million, it was forced to close its doors because it couldn’t keep up with the competition. Another example is Luxe, and on-demand parking and valet service that started out with a promise to park cars at a rate of $5 dollars an hour or $15 for the day. The app is still up and running, but it’s been forced to drastically raise its prices to just under $30 per day. Even known names like DoorDash are struggling to stay afloat—the food delivery service isn’t raising the amount of money it originally expected.
An exception to this trend is Clowder Coffee, which is solidifying itself as the name to beat in the “Uber for Coffee” industry. It was founded by two McKinsey & Company alumni and graduates of 500 Startups, Christine Miao and Matt Casey. Miao currently serves as the brand’s CEO, and is responsible for driving the brand’s efforts to make the “Uber for coffee” model work.
The concept behind the brand is simple—it delivers coffee straight to customers’ desks. Each order is affordable—drinks start at $3 and there’s no order minimum. After users place their orders online, each drink is brewed-to-order and packed in a proprietary carrying case so it stays at the perfect temperature throughout the delivery process. Customers will get a confirmation and time estimate of when they can expect their order, which is typically within 15 minutes. Clowder baristas then contact users directly when they’ve arrived with an order.
What makes Clowder unique is its commitment to offering its baristas and delivery teams flat, fair rates. All of the brand’s employees are W2 workers, and all tips, gratuities and delivery charges are included when customers place their orders. That promise to give employees livable wages—especially in major metropolitan areas—doesn’t go unnoticed by consumers. And as long as customers keep relying on Clowder to get their morning caffeine boost, the brand will continue to expand its reach.
Right now, Clowder’s services are limited—it only has locations in New York’s financial district and Mountain View, California. But as it continues to build its “Uber for Coffee” business in the months and years to come, it’s possible the service will be launching in new cities and communities across the country.