SEA can’t sleep as startups brew espresso

IN FOCUS

In today’s newsletter, we look at:

• The startup-backed coffee brands brewing in Southeast Asia
• How AI is being utilized by a number of players in the coffee industry

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Hi there,

When I visited Seoul in 2016, I was surprised how there was a coffee shop on almost every street corner. It varied from global brands to mom and pop shops. But isn’t South Korea a tea-drinking country?

Soon, I found the same phenomenon happening in the streets of my hometown, Manila. It’s no longer surprising to find at least 10 different coffee shops and stalls in one mall these days.

Eventually, even startups found their way into competing in this cutthroat space. Our Big Story this week shows the various tech-enabled coffee brands brewing in Southeast Asia.

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Tech-enabled coffee chains percolate across Southeast Asia

In 2021, funding for coffee startups exceeded US$112 million. While capital infusion in this space fell 63% in 2022, it managed to pick up slightly in 2023.

You may wonder, how do these startup-run coffee joints differ from big brands?

While Starbucks specializes in being a “third place” for its customers, these brands are mostly focused on serving coffee quickly and inexpensively. They do so by running through carts and in smaller shops. Some also offer delivery services through their apps.

AI bots added to the brew

In other parts of the world, however, some coffee chains are already integrating more advanced technologies such as AI into their operations.

Finland-based Kaffa Roastery, for instance, launched a coffee blend made through AI. Aptly called “AI-conic,” the blend mixes four types of Brazilian beans.

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