Algrano

Even though Algrano operates an online marketplace for coffee, the successful start-up from Greater Zurich sees itself primarily as a technology company. The efficient and unbureaucratic access to bridging loans from the Swiss government in the COVID-19 crisis excited Algrano’s foreign investors. We spoke with CEO and co-founder Raphael Studer.

Raphael, why don't you introduce us to Algrano?

Raphael Studer: Algrano is Spanish for "straight to the point." Our digital trading platform for raw coffee brings coffee producers and roasters directly together. By eliminating the traditional, sometimes centuries-old trading chains, the value chain of coffee trading becomes more efficient, transparent and fairer. The coffee farmer can build up his own brand and realize a better price.

In addition to facilitating supplier relationships online between roasters and producers, our platform also includes the actual execution of supply chain contracts, e.g. in the areas of trade financing, warehousing, customs clearance or transport of green coffee. Small specialty roasters rely on our solutions just as much as large retailers throughout Europe.

Zurich is not exactly known for coffee trading. Why did you start your business here?

Even though we operate a coffee trading platform, we see ourselves primarily as a technology company. We develop the technology in-house. And that's why Greater Zurich, with its many talents and its innovation- and startup-friendly environment, is one of the best locations. We find many bright minds from the IT sector here, and thanks to the high quality of life, we can attract talents from Ireland, England, Portugal, etc. to Zurich. We currently have 12 nationalities in our team of 20 people.

How has Algrano developed over the last few years?

Very quickly. We have tripled the trading volume in the last few years on average every year. Starting out as three founders with an idea in 2015, we have become a company with global ambitions. 

For a technology company like Algrano, Greater Zurich with its many talents and its innovation- and startup-friendly environment is the ideal location.
Raphael Studer
Raphael Studer - CEO and co-founder of Algrano

How has the coronavirus crisis affected your business?

Our retail customers, who account for about 50 percent of our trading volume, have not been negatively affected. On the contrary, they were more inclined to place coffee orders in order to secure their supply. The small roasteries, on the other hand, which supply restaurants and serve coffee themselves, have been hit hard. They have hardly called up any coffee from the warehouses for weeks. Because Algrano pre-finances these deliveries and we are only paid on call, this has had a direct impact on our liquidity since day one of the lockdown.

How have you been dealing with this?

We were not surprised. Our scenario planning started long before the lockdown decision - also thanks to early signals from our employees in Hong Kong and Italy. Our team was heavily involved in the decisions and proposed many cost-saving measures on its own, including salary cuts, use leave days and work negative hours.

At the end of March, the Swiss Federal Council (government) approved an aid package to bridge liquidity shortfalls for SMEs. The credit facilities are granted by the their main bank and secured by the Confederation...

Our bank's client advisor approached us actively about this possibility on the same day. We came to the conclusion that we would like to take make use of this assistance for a part of our business, namely the pre-financing of coffee deliveries. We did not need any support for salary costs - and thanks to the commitment and initiative of our employees, short-time working is not necessary either. The following day, at 9am, we submitted a one-page application via the e-banking system of our bank. Two and a half hours later, the money was already in our account.

Our foreign investors were excited about the unbureaucratic and efficient support provided by the Swiss authorities.
Raphael Studer - CEO and co-founder of Algrano

How did your foreign investors react?

Two of our foreign investors were informed about the process due to their mandate on the board of directors. Both were very surprised by the speed of implementing the package of measures. A Dutch investor, who sits on our board of directors, said that this was the ultimate in Swiss efficiency. His American colleague wondered whether the US would provide comparable aid to their companies...

Thanks a lot for sharing these insights, Raphael. A personal question at the end: How do you like your coffee?

It depends on the time of day. In the morning, I like to have a cappuccino or flat white. I usually use coffee beans that harmonise well with lactic acid, for example from Central America. In the afternoon, I like to drink filtered coffee – from a floral coffee, for example from East Africa.

 

Algrano

https://www.algrano.com/en
 

Pictures_Algrano
Algrano co-founders Gilles Brunner (left picture in the middle) on a field trip to Colombia and Ralph Studer (right picture) brewing his coffee

Greater Zurich as a start-up location

Successful startups in the fields of forward-looking technologies represent the innovative strength and competitiveness of a location. 2019 was a record year for the vibrant and diverse startup scene in Switzerland.

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