Why can only 19 stores in BLUE BOTTLE COFFEE get a financing of $70 million?

With only 19 stores, Blue Bottle Coffee, valued at hundreds of millions of dollars, is challenging Starbucks' dominance with fine-brewed artisanal coffee.

Blue Bottle, Silicon Valley's favorite high-end coffee retailer, has just completed a new $70 million round of financing.

Blue Bottle is arguably the most successful example of commercializing and operating artisanal cafes on a large scale, and some people believe that the financing is intended to engage in a real confrontation with coffee shop giant Starbucks. Although Blue Bottle declined to disclose the valuation of the company in this round, startups that can raise that level are typically valued at hundreds of millions of dollars.

The financing was led by Fidelity, the largest fund manager in the United States, with hedge fund Tetragon Financial Group participating, and existing venture capital shareholders Index Ventures, True Ventures and Google Ventures also participated in this round of investment. The company also plans to raise an additional $5 million from independent investors.

Blue Bottle has raised a total of $46 million in two previous rounds of fundraising. the last round was led by Wall Street's Morgan Stanley last year, and current investors include Google Ventures, Index Ventures (also an investor in Just Eat, Moleskine and Sonos), True Ventures (an early riser in Fitbit), U2 lead singer Bono, Oscar-winning supporting actor Jared Leto, professional skateboarder Tony Hawk, and Instagram founder Kevin Systrom.

Bryan Meehan (below), executive chairman of Blue Bottle, said: "I believe capital giants like Fidelity see a huge opportunity. Like fast food giants Chipotle   and Shake Shack, we have grown from scratch to provide consumers with better coffee and baked goods."

Blue Bottle mainly sells handmade coffee and traditional coffee makers. There are 19 chain stores in New York, California and Japan, which are sought after by fashionistas and technologists.

The financing follows Blue Bottle's acquisition of Tartine Bakery, a San Francisco bakery, in April and expansion in the Bay area, New York, Los Angeles and Tokyo. It may also enter other Asian cities, such as South Korea, Taiwan and Hong Kong.

Blue Bottle founder and CEO James Freeman (below) shows that unlike the third wave of cafes, which makes money by distributing coffee beans, he focuses only on the company's retail stores. "Retail is expensive, but if you do it the right way, you get a high return."

(according to Chad Robertson, co-founder of Tartine Bakery: the third wave of coffee refers to the artisanal coffee upstart baking coffee in different ways, they are obsessed with the details, while the fourth wave of coffee is to make it have a wider audience without harming these things. ")

The speed and scale of Blue Bottle financing surprised some coffee purists in San Francisco, and some employees left the company to open their own stores because they were deeply dissatisfied with the growing involvement of MBA and management consultants in the business. Unfortunately, this is the reality that a company must face when it grows and expands from the "family business" model.

Blue Bottle also highlighted the high-margin coffee shop style preferred by investors and loved by millennials as a way to compete with local competitors such as Sightglass Coffee, which was invested by Twitter and Square co-founder Jack Dorsey.

Explore Blue Bottle stores:

The store on Williamsburg Street in Blue Bottle Brooklyn is located in an early 20th century brick building that was once used as a glassblowing factory, blacksmith house and barrel production.

A distinct LOGO at the entrance.

Customers are tasting coffee and reading newspapers at the counter.

More people gathered around the long table in the middle of the cafe.

There are many people around, but the atmosphere of the cafe is very lazy, and soft music comes from the stereo.

Looking behind the counter, the Williamsburg store uses an old-fashioned Probat roaster, Kyoto-style iced coffee emitters, and Faema Urania leveraged espresso machines.

The menu is simple and clear, and each kind of coffee has only one cup size and one price.

Behind the counter, the waiter manages an eyedropper that can make seven cups of coffee.

They all carry the Blue Bottle logo, too.

Coffee is not the only product of Blue Bottle. You can buy Granola cereal in takeout bags, and there are baked goods behind the counter.

There are many delicious foods on the counter, including these Mast Brothers chocolate bars from Williamsburg.

Olive pastry and ginger brown sugar cookies are just appetizers.

According to Blue Bottle staff, the restored Faema Urania leveraged espresso machine dates back to 1958.

New Orleans iced coffee and buckwheat milk cookie sandwiches.

This cookie is one of the best coffee shop snacks, a wonderful combination of sweetness and saltiness.

New Orleans iced coffee is sweet, with ice cubes, milk and sugar.

Italian espresso (left) and drip coffee (right). There is a label on each bag to know the variety, origin and fair trade certification of the coffee beans inside.

The waiter put the finishing touches on the espresso.

Ethiopian fruit variety of Italian espresso, the finished product is very beautiful.

The nearly finished drip filter coffee.

This coffee is also from Ethiopia, preferably without sugar and milk. Packed in a glass, it exudes a faint fragrance of flowers, just like a cup of tea.

A trendy brown takeout cup.

These strange-looking machines are slow ice-drop coffee machines made by Japan's Oji Group, which are used to make Blue Bottle's Kyoto iced coffee.

These five ball-shaped filters are placed with some coffee accessories, right in the middle of the counter.

There are many items on sale in the store, such as the $25 Hario brewing coffee maker.

An overview of the baking process.

Coffee beans on the shelf in the kitchen. The staff explained that they would bake small bags of coffee beans, about half a sack.

Every day, the staff use this old-fashioned Probat roaster to produce coffee beans, because the steps are very precise, so it requires a high degree of concentration. To ensure freshness, the beans sold by Blue Bottle are baked within 48 hours.

Employees need to undergo rigorous training before entering Blue Bottle Cafe to work.

There is a small and simple handwritten notice board in the coffee shop-no smoking (if you want to leave, it also provides the number of the store where you can smoke).

Similar handwritten bulletin boards encourage recycling of empty paper cups.

Planning for the future:

Blue Bottle has just bought a 20, 000-square-foot (1900-square-meter) store on Bushwick, near Brooklyn, and is rapidly developing into a high-end residential area, three blocks from fashionistas' favorite Roberta's Pizza. Blue Bottle's current Brooklyn bakery will move from Willamsburg Street in 2016, near the site of New York's first Tartine.

Next year, a new Blue Bottle store will open at the Bradbury Tower in downtown Los Angeles, a landmark in the 1893 sci-fi film Blade Runner. With the acquisition of Tartine Bakery, Los Angeles's first Tartine bakery will also open in the city's Arts District within a year.

From: Hua Lizhi Jiang Jingjin