From top-quality coffee and recycling plants

To speak of an "unusual business model" would be an understatement. The start-up Plastic 2 Beans sells coffee from Ethiopia on the one hand and offers knowledge for the construction of recycling plants on the other. How does one come up with such an idea?

Kalie-Martin Cheng himself doesn't really know how to begin when he talks about the story of his start-up's founding. He met his co-founder Abiye Dagnew when he wanted to borrow his daughter's water wings for his son, Cheng begins. Then he starts all over again and prefers to begin with his studies and his doctorate, because that also plays an important role in the founding of Plastic 2 Beans.

When Cheng starts talking about the Cologne-based start-up, it quickly becomes clear that everything is a little more complicated than with other young companies - or at least more unusual. The start-up doesn't focus on one fancy product, but works in two completely different business areas in parallel. On the one hand, Plastic 2 Beans is a trader of Ethiopian coffee; on the other, it wants to strengthen the circular economy in the country. To this end, it has already collaborated with the Gesellschaft für Internationale Zusammenarbeit (GIZ), for example. The current project involves the construction of a recycling plant for plastic bottles. In addition to the coffee trade, the start-up also brokers investors, has already conducted a feasibility study and is also receiving money for this. "We finance ourselves 50 percent through our coffee sales and 50 percent from development cooperation contracts," says Cheng.

Knowledge transfer in exchange for coffee as payment

Last year, the start-up received the special prize of the Effizienz-Preis NRW for its idea of combining both business areas. The prize is awarded by the Effizienz-Agentur NRW, which works on behalf of the North Rhine-Westphalian Ministry of the Environment. The combination of the two business areas enables the start-up to transfer knowledge to Ethiopia for recycling without Ethiopian companies having to pay it directly. Plastic 2 Beans therefore likes to describe it itself as a transfer of technology and knowledge in exchange for coffee. "The concept is a new approach that thinks together economic sectors that, at first glance, have nothing in common. The business model elevates goods to a currency in order to circumvent the lack of foreign currency [in Ethiopia]," was also how jury chairman Bernd Draser explained the award for the start-up at the time.

If you visit one or the other Rewe supermarket in Cologne, for example, you can already find the start-up's products on the shelves. There are whole coffee beans or ground ones, from a bag or gladly from a glass bottle. Those who are not yet in the start-up's sales area can also use the online store, but must pay an additional €4.90 delivery fee on the already expensive coffee if they buy for less than €50. The start-up also works directly with some companies. According to its own information, it delivers coffee to Henkel or Aktion Mensch, for example.

In both worlds, the founders are concerned with the issue of impact. "Slurp for a better world," they call the motto of their company. Plastic 2 Beans relies on the two coffees Wallaga Henna and Limmu from Ethiopia, which are among the world's best varieties for some coffee drinkers and are also considered particularly sustainable, according to the startup. They originate from the Ethiopian highlands and are gently cultivated there according to centuries-old tradition, the start-up promises on its site.

Coffee is more expensive than fair trade

Plastic 2 Beans sources its coffee from cooperatives, which are associations of coffee farmers. "Fair trade traders usually pay local farmers around ten percent above the market price, we now pay at least 6.50 euros to 7.30 euros per kilo, before the rapid price increase in the coffee sector that was two to three times the stock market price, currently it is around 1.5 times," says Cheng.

In the end, though, it's the Ethiopian world of recycling where the startup really wants to make a difference. Recycling is likely to become an increasingly important topic for Ethiopia. On the one hand, the country suffers from a general shortage of raw materials such as plastic, metal or paper, because there is a lack of resources for them, as analyzed by the consulting firm Global Business Network. On the other hand, the country's high dependence on imported raw materials combined with a shortage of foreign currency and high transport costs lead to prices that are two to three times higher than on the international market.

It is therefore fitting that Cheng is a polymer chemist and has studied in this field. He wants to apply his knowledge to the issue of sustainability if possible. "When my daughter was born, I started asking myself how I wanted to leave our world to her," he says. While Cheng says the plastics industry in Ethiopia is now growing rapidly, the all-important recycling is not growing with it. Plastic bottles in the country are mostly just shredded, then shipped to Europe and reimported as expensive PET bottles after recycling, he says. This means that the actual value creation still takes place abroad.

Talks with investors underway

According to the founder, there has simply been a lack of knowledge and access to technology to carry out the recycling in Ethiopia itself. The fact that the country has not been able to develop this so far is again due to a lack of foreign currency. Ethiopian entrepreneurs have difficulty paying their trading partners in U.S. dollars or euros. This deters many of them. Plastic 2 Beans is therefore campaigning for the construction of a recycling plant in Ethiopia. The potential impact of the project is a saving of 30,000 tons of CO2 per year.

The start-up is actively planning the project and, according to founder Cheng, is also making investors aware of the planned plant. In the end, he says, this plant should be operated by a joint venture between an Ethiopian investor and a German one. "We did our feasibility study in the midst of the Tigray conflict," the founder says. "We had already found a European investor for our first project, a recycling plant, but unfortunately he pulled out because of the conflict."

Since the situation in Ethiopia has improved again, however, Cheng hopes that plans for the plant can now proceed quickly. He says that talks are already underway with a new investor from Germany. Recycling could start on site as early as the end of 2023.