LOOK: This Coffee Start-up Gains PHP 2.2 Billion in Funding
A rising star in its own right, Pickup Coffee is just a little over a year old, but its current valuation is estimated to be at around PHP 7.18 billion.
Pickup Coffee, the start-up that offers coffee-based drinks that do not exceed PHP 100, has secured $40 million (approximately PHP 2.2 billion) in its series A1 funding. This refers to the series of funding that a start-up gets from investors—with A1 funding referred to by Investopedia as “investment in a privately-held start-up company after it has shown progress in building its business model and demonstrates the potential to grow and generate revenue.”
Simply put, this comes from large venture capital or private equity firms, as opposed to seed capital—the first round of investment—which usually comes from the founders themselves, friends and family, and small angel investors.
According to Tech in Asia, Go Ventures led the round by investing $12.7 million (approximately PHP 702 million). Openspace Ventures and Kickstart Ventures likewise participated and invested a combined total of $6.1 million (approximately PHP 337.63 million) in the coffee startup. Other participants include Gentree Fund and Venturi Partners.
Tech in Asia notes in its report that prior to the series A1 funding, Pickup Coffee’s valuation was only at $9.5 million (approximately PHP 525.82 million).
What is Pickup Coffee?
Pickup Coffee’s green-colored trucks and storefronts are a familiar sight in Metro Manila. Described as “a home-grown coffee company focused on making premium beverages more accessible,” its drink prices begin at only PHP 50—with none of its beverages exceeding PHP 100.
Although it has only been a little over a year since the brand was founded by Diego Lorenzo and Jaime Gonzalez, the startup has quickly expanded—not just in Metro Manila but in Cebu as well. In fact, its expansion is not limited to its number of branches, as last October, Pickup Coffee expanded its coffee-based menu to include iced teas.
The Coffee Industry in the Philippines
Pickup Coffee’s successful series A1 funding is a positive sign for the coffee industry in the Philippines, whose market is expected by Statista to grow annually by 5.69% (CAGR 2023-2025). Tech in Asia notes that revenue is currently pegged at $6.7 billion (approximately PHP 370.84 billion) for this year.
The food and drink service aspect of industry has seen a lot of growth in the past year not just in the Philippines but internationally as well. Here at home, numerous new cafes have sprouted up in different parts of the Philippines in the last year. This, of course, includes Pickup Coffee.
Looking specifically at the number of coffee shops in the Philippines, Statista’s latest data shows that Starbucks is the leading cafe in the Philippines based on sales. Starbucks is followed by Dunkin’, The Coffee Bean and Tea Leaf, McCafe, and Mary Grace.
As far as store count is concerned, McCafe tops the list of leading cafes.
With its additional funding, Pickup Coffee now has the means to become more competitive in the market, and time will tell if it will soon join the list of leading cafes in the country at the end of the year.