Equator Coffees expands Bay Area chain of stores south to Los Angeles

Marin County’s powerful roaster Equator Coffees is gaining ground in another major California metro market, opening its newest retail location in La La Land.

The shop opened its doors at 8900 Venice Street. in Culver City in March, it forms one of nine locations operating primarily in the San Francisco Bay Area.

The Mill Valley-based company that launched in 1995 has come out of the pandemic and come to life in a similar way to the number of people who slip out of bed, only to re-energize after the first cup. And that’s exactly what Equator Coffees has done, after a rollercoaster ride of massive revenue closures.

“Overnight, everything shut down. It was scary. Our revenue fell to 2010 levels,” Helen Russell, co-founder and CEO, told Business Journal, commenting on the early pandemic period that began in March 2020.

The figure equates to 35% less than $20 million in annual revenue for 2019, the level the company is now back at. It also rebounded with roughly the same number of employees (155), after furloughing employees on the wholesale side of the company.

It received $3.72 million in Paycheck Protection Program funding from the US Small Business Administration.

“We were very lucky to get that,” Russell said.

Russell and her business and life partner, Brooke McDonnell as co-founder and chief product officer, put their heads together to come up with a plan to focus more on retail — especially since coffee drinkers still need a fix.

“We really had to pull out and figure out how to deal with the pandemic. And when it reopened, it was great because all of our stores have outdoor patios,” Russell said, describing the comfort level of many diners who refuse to eat and drink inside due to the pandemic.

The company has developed a mobile ordering app, which has helped keep the business afloat.

Today, Equator Coffees operates sales divisions that include the retail roasting business. direct to consumer grocer; “electronic tail” highlighting online retail through platforms such as Amazon.com; and wholesale that includes satellite operations of major technology companies such as Twitter, LinkedIn and Google. The company is also a supplier to some famous chefs, including Thomas Keller and Tyler Florence.

Russell noted that she chose Los Angeles as her next brewing district because it coincides with a philosophy the company shares in pairing its coffee with an active lifestyle. Additionally, the area is another major California market. The 1,400-square-foot Culver City site has been around for years. Although the company signed the lease in 2018, the opening was suspended due to the pandemic.

The company plans to open two more stores by the end of the year. Those sites are not disclosed.

In the first week of beginning its Southern California expansion in March, Equator Coffees donated 10% of its sales to the Los Angeles LGBT Center, a sign of the company’s continued commitment to philanthropic efforts. She raised $5,000 for the center.

Because the coffee roaster operates on a motto of focusing on “people, product, process,” Russell attributes much of the company’s success to its employees—especially in the midst of a crisis.

“The uncertainty was very high, but fortunately we have a great team,” she said.

Admittedly, Russell’s sales acumen helped sustain the business as well as McDonnell’s keen taste for what makes great coffee.

The company, which gets its name from the region where most of the world’s coffee is grown, owns land in Panama to boost its supply. We have grown to supply 45 different coffee blends.

Growth is the name of the game in the coffee business, as the massive increase in competition in the industry has shown. According to an April 2022 report released by Technavio, a global data research firm, the specialty coffee market will grow by over 12% in the next five years.

“When we started roasting, there were only five women and 30 to 35 roasters on the West Coast,” Russell said, adding that the number is now in the hundreds.

“The coffee business has become very competitive,” she said.

Russell said most operations require at least $200,000 in startup capital. Costs can be reduced if the company rents time in the “co-roasting” space. Equator Coffees operates a roasting production facility in San Rafael.

In good company in Marin County

Reflecting a small world in the industry, San Rafael-based Addictive Coffee has also bounced back from the pandemic. The company roasts coffee and provides breakout rooms for tech companies, small grocery stores, and hotel rooms.

Mike and Jane Ralls had a hit with their 5-year-old business, but made a comeback after several of the companies that supplied them with coffee shut down and dried up their ordering capacity.

The company focused on one-off packages and 10-ounce cold brew cans.

Today, with businesses returning and their small kitchens reopening, Addictive Coffee has again contracted with Google and Facebook as well as Sony, Genentech, Uber and JP Morgan Chase. Addictive Coffee can also be found again on shelves at Andy’s Markets. She also bought new groceries through the sale at Molly Stones.

The $69 billion specialty coffee market has taken off in recent years. A recent survey by the National Coffee Association showed that more than half (59%) of coffee consumers choose gourmet coffee brands.

Susan Wood covers law, hemp, production, technology, energy, transportation, and agriculture, as well as banking and finance. For 27 years, Susan has worked for a variety of publications including the North County Times, Tahoe Daily Tribune, and Lake Tahoe News. You can reach her at 530-545-8662 or susan.wood@busjrnl.com.

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