Keurig Founder Sold Out for $50K
J Thoendell stashed this in Tech
Almost one in three American homes now has a pod-based coffee machine, even though Sylvan never imagined they would be used outside of offices. Last year K-Cups accounted for most of Keurig Green Mountain’s $4.7 billion in revenue—more than five times what the company made five years prior. So even though he gets treated like a minor celebrity when he tells people he founded Keurig, Sylvan has some regrets about selling his share of the company in 1997 for $50,000.
Worse than the fact that he only got $50k is the fact that K Cups are an ecological disaster.
In 2010, journalist and caffeine aficionado Murray Carpenter visited the Keurig facilities in Waterbury, Vermont, reporting for The New York Times that the K-Cup idea posed environmental concerns, as the pods were not recyclable or biodegradable. It was that same year that the Keurig model seemed to take off, doubling in sales. In a 2011 local-boys-make-it-big story in Boston magazine, Eric Anderson, a professor of marketing at Northwestern University, likewise noted that the coffee machines could invite significant backlash because they “generate a ton of plastic waste.”
At the time of Carpenter's visit, Keurig was on pace to sell three million K-Cups. So to say that growth has been good since then is understatement; last year they topped 9 billion. But today the cups are still not recyclable or biodegradable. And they only stand to become rapidly more ubiquitous. Later this year, in partnership with Coca-Cola, the company will release a machine called “Keurig Cold” that will “introduce Coca-Cola’s global brand portfolio” to the machines, growing rapidly closer to the corporate mission: “A Keurig brewer on every counter and a beverage for every occasion.”
Though the predicted consumer backlash has arrived, especially in recent months, the company continues to grow. Others have entered the market very successfully. While drip coffee-maker sales are stagnant, pod-machine sales have increased six-fold since 2008. Looking back on his invention, amid increasing public condemnation of K-Cups as a scourge on the planet, Sylvan told me, “I feel bad sometimes that I ever did it.”