Instant coffee is a billion-dollar market with a bad reputation. A startup backed by Meghan Markle is on a quest to usher in a new era.

Hannah Mendoza CLEVR Blends
Hannah Mendoza Courtesy of Hannah Mendoza

When Hannah Mendoza was nine years old, she had an idea: a smoothie bar for kids.

She set up shop in her home economics class and organized a group of classmates to help sell her creations. It was something she loved, Mendoza told Insider. She didn’t know it would foreshadow the business she would one day run.

Today, Mendoza, 29, is CEO and cofounder of two-year-old Clevr Blends, a company that sells instant, “SuperLattes,” infused with “superfoods” like mushrooms and probiotics, which help with digestion. Priced at $US28 ($AU38) a bag (each bag makes around 14 lattes), the company told Insider it saw a substantial increase in sales last year and is expecting the trajectory to continue throughout 2021.

On Tuesday, it launched its latest product, a Rose Cacao mix, infused with calming herbs.

Instant coffee has a bad reputation, Mendoza said. However, in her view, it works for next-gen consumers who are always on the go. By marketing her instant coffee as a healthy form of self-care, Mendoza is attempting to tap into the intersection of the billion-dollar coffee market and the trillion-dollar wellness industry. It seems to be working: Meghan Markle – who, alongside Prince Harry, made Times’ 2021’s 100 ‘most influential’ people list – invested an undisclosed amount last year. Oprah also posted about the brand on Instagram. Overall, packaged coffee sales rose during the pandemic, Bloomberg reported.

In an interview with Insider, Mendoza reveals the steps her company is taking to remake instant coffee’s reputation and connect with young consumers, including making sure the brand’s actions match its ethos of empowerment and investing in a sustainable supply chain.

Spotting an intersection of two thriving markets

The global instant coffee market hit $US12.1 ($AU17) billion last year, while the global wellness market was estimated at over $US4.4 ($AU6) trillion in 2019. Mendoza saw the chance to tap into both by making a coffee and tea alternative that has less sugar and uses an organic mushroom-infused latte mix instead of just coffee beans.

“I would love to be in a position where I can squeeze my own nut milk and blend up an elaborate drink, but that’s not the case and I know that’s not the case for a lot of people,” she continued.

Hannah Mendoza CLEVR Blends
The goal of Clevr Blends is simply to make people feel good, Mendoza said. Courtesy of Hannah Mendoza

It took one year and “thousands” of iterations for Mendoza to settle on a recipe, she said. The result is now five different instant latte mixes, each infused with ingredients such as lion’s mane, a mushroom that helps improve memory, and ashwagandha, a root that helps reduce stress.

Young consumers, especially, seek to support brands that match their eco-conscious and social values, and Mendoza says it’s important for her brand to “put the money where its mouth is.”

That’s why the company strives to be transparent about its supply chain, touts its mostly female and non-binary team, and donates 1% of its revenue to charity.

“If there are 20 different types of matcha, we ask, ‘which one tastes the best, which one has the best transparent supply chain?” she said, adding, for example, the company sources matcha from Japan and buys turmeric from Diaspora Co., a company specializing in equitable spice trading, located in Oakland.

Clevr Blends also sources cocoa from a regenerative farm in the Ecuadorian rainforests, where farmers manage their lands to make the soil richly bio-diverse. This helps contribute to natural carbon mitigation, and the practice has been a growing trend as brands pivot toward becoming more environmentally friendly.

Knowing your customers intimately is key

In its early days, the Clevr Blends team took the time to meet with customers to garner feedback on how the products made them feel.

Daisy Pyo, a graphic designer based in Brooklyn, discovered the brand on Instagram, where its photos feature soothing pinks, yellows, and greens, waves crashing at the beach, and selfies of people sipping their instant lattes. Pyo told Insider she loves that the powders already contain adaptogens and probiotics so she can skip taking additional supplements in the morning.

Hannah Mendoza CLEVR Blends

“I really enjoy the ritualistic aspect of starting my day with making matcha in the mornings,” Pyo said. “It’s also just really tasty, so I see it as my little ‘pick-me-up.’ I feel good about incorporating it into my daily routine because I know it’s good for me.”

One high-profile customer turned out to be Markle, as Fortune reported, who found the brand after trying one of its instant lattes and became attracted to its ethical ingredients, community-focused business model, as well as the fact the company is female-led. Fortune reported that after news of the investment spread, the company had a month-long waitlist.

Hannah Mendoza CLEVR Blends
Hannah Mendoza Courtesy of Hannah Mendoza

Working at a start-up was useful training for running her own

Mendoza always wanted to open her own business.

Growing up outside of London, she decided to move to California, without knowing a soul, after seeing an article about Emma Watson applying to school in the US.

Mendoza figured she’d give it a try, and went on to attend the University of California, Santa Barbra, where she studied applied psychology, global studies, and entrepreneurship.

Her first job was at food startup Imlak’esh Organics, where she learned the importance of organic farming, fostering healthy company culture, and how to be comfortable with the unknown.

It doesn’t hurt to take chances, either.

For instance, Clevr Blends is primarily e-commerce but is sold in one store – Erewhon Market in Los Angeles. A friend of Mendoza’s had a meeting set up with Erewhon buyers for his own product but believed in Clevr Blends so much, he snuck Mendoza and her cofounder into his own buyers’ meeting.

The buyers were skeptical at first but eventually fell in love with Clevr Blends. The same way Markle did, and Oprah, and all those kids at Mendoza’s elementary school. “It was an incredibly rough year for everyone,” Mendoza said. “But if what we’ve created made people’s mornings even ten percent easier – I’m really grateful for that.”