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- The Hidden Coffee Juggernaut ☕️
The Hidden Coffee Juggernaut ☕️
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Finlay Williams
October 15, 2024
2 minute wacky businesses, you can tell your buddies about 🧠
Let me introduce JAB Holding Company. They might not sound like a household name, but they’ve probably been involved in your morning coffee, your luxury footwear, and maybe even your pet’s food. That’s because JAB is a master of snapping up businesses, making bold moves that seem almost absurd until they pay off big time. These guys are the "Avengers" of rolling up household comfort brands. JAB is a holding company that operates across sectors like food, beverages, and luxury goods. However the main one; they basically control the world’s caffeine supply.
Market domination and generational wealth 🧐
Founded in 1828 by the Reimann family, JAB started as a chemical company before doing a 180 and diving into consumer goods. Today, they’re the unsung heroes (or villains, depending on who you ask) of the global snack and luxury market.
Their strategy has one golden rule: diversify but dominate. Total domination through acquisition. When most companies expand by scaling what they already do, JAB expands by buying up brands and turning them into cash cows. And it’s not just any brands, they look for iconic names in "comfort" sectors, but they operate like the ultimate chess players, making moves that look risky until they absolutely crush it. They’re not playing monopoly, they own the damn board.
What are the nuggets? 💎
☕️ Origin: The Reimann family, some of the richest people in Germany, built their fortune in industrial chemicals. 90% of JAB belongs to four of the nine adopted children of the late Albert Reimann Jr. But when Peter Harf came on board as chairman in the 1980s, he changed everything. Harf’s vision was to forget chemicals, luxury goods, food, and beverage were the future. This pivot wasn’t just about money, it was about cornering markets most people didn’t even see coming.
☕️ Inflection moment: In 2012, JAB bought a little brand called Peet’s Coffee. That acquisition was just the beginning of their caffeinated conquest. A year later, they grabbed Caribou Coffee, and it snowballed from there, with Krispy Kreme and Keurig rolling into the portfolio in the years to follow. By 2018, they were the Starbucks killer you’ve never heard of. Selling off the majority of their luxury goods companies and doubling down on the fast-casual food sector.
☕️ Funding: Backed by Reimann family cash and strategic investment partners, JAB didn’t exactly raise capital like your typical startup. They had billions in their war chest from day one.
☕️ Big moves: Acquisitions are JAB’s bread and butter. But what’s interesting? They never fully rebrand their purchases. They keep the essence of the brand alive while quietly integrating them into a massive, profit-maximising machine. Whether it’s Panera, Keurig, or Pret, JAB lets these brands run autonomously but extracts insane value through consolidation back-of-house operations.
☕️ Awesome play: Their Keurig acquisition might just be the wildest thing they pulled off. By turning Keurig into a platform that licensed pod technology, they went from a gadget to a recurring revenue machine. JAB was thinking like a tech company, not a beverage company. JAB and other investors acquired Keurig Green Mountain for $13.9 billion in 2016, in 2023 the company had $14.8 billion in annual revenue.
☕️ Global domination through coffee: By acquiring different brands around the world - whether it’s Peet’s in the U.S., Jacobs Douwe Egberts in Europe, or Keurig in pretty much everyone’s kitchen - JAB controls global caffeine intake. It’s like they don’t just want you to drink their coffee, they want to own every brand of coffee you drink.
☕️ Family power play: The Reimann family is notoriously private, but their influence in JAB is massive. What’s intriguing is how they’ve quietly become one of the richest families in the world, while most people have no clue who they are. It’s a testament to how they use JAB as their vehicle to grow wealth without the glitz and glam. They’re basically shadow billionaires.
Recommendation 🌟
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