Blockchain pioneers want consumers to wake up and smell the coffee

Killian Stokes and Shane Reilly had both experienced different countries of the coffee belt during their worldly travels before met during postgraduate studies at UCD’s Innovation Academy.

Reflecting on their experiences and the fact that 99.9 per cent of coffee is exported before roasting, they felt there was something they could do about that.

Now, not only are they making an impact in the coffee industry, they are looking at blockchain to help consumers to do the same.

“We started to explore ethical trade and coffee brands and we looked at whether we would be able to set something up. We came across this Dutch-Ethiopian collaboration, Moyee coffee,” says Stokes. The company supports farmers to roast their own coffee beans before export.

After a trip out to the mountains and forests of Ethiopia to see the supply chain in action, “I thought this is brilliant, we should bring this product to Ireland and the UK.” The pair met Moyee Coffee founder Guido van Staveren van Dirk in Amsterdam, “and decided that we would help expand the product and bring it here to the Irish market”.

That was more than two years ago and now Moyee Coffee Ireland has found its market selling to tech companies such as Groupon and Slack, “the sweet spot, coffee at work,” as well as independent retailers.

Moyee Coffee, as a whole, wants to deliver transparency of its supply chain to its customers and is building a platform which incorporates blockchain technology delivering instant information to the consumer.

FairChain Foundation

“Behind Moyee there is the FairChain Foundation,” says Stokes. “I guess it gives the credibility to the coffee brand. It’s the FairChain foundation that’s building the blockchain and it’s training farmers – helping at the ground level for those farmers to get to a living wage.

“In many ways what we are trying to do with your coffee is, we’ve three principles: it’s 50/50 shared value, we want 50 per cent of what you pay going to that country of origin. We believe in quality, not charity, so the quality is really important – are the beans graded in the top 5 per cent of all coffee in the world?

“And I guess we believe in trade, not aid, so taking out the middle man, ironing out inefficiencies and shifting value back. Maybe you could say [we are] redesigning the business model to make it more fair, more balanced.

“Your supply chain is your brand. It’s not just a colourful logo or having a celebrity front your coffee. For us as consumers the brand is knowing where that product came from – it was developed in an ethical fashion and it didn’t destroy the planet and the people involved there weren’t in slavery and got paid a fair wage for their input.”

They propose to use money from their marketing budget to either reward the consumer or have the consumer send the reward back somewhere along the supply chain.

“That is really is the beauty of the blockchain,” says Stokes. [For us] it’s got two massive potentials to it. One is that you and I can pick up a product and zap a QR code and see exactly who got paid what, from the farmer to your bag or cup. So that’s 100 per cent transparency and the blockchain is validating every process in that journey. And the second part is really to connect you as a consumer with those farmers.

“When you buy a product there’ll be another QR code on the inside of the bag or at the till – you get 50 cent back out of your purchase to do with what you wish, you either keep or share. You might decide to share that with the farmer, so effectively tip the farmers, maybe send the 50 cent back to pay for seeds or tools or loans the farmers are seeking or maybe to plant trees in their community.”

FairChain is using Hyperledger Fabric to build its platform. “This allows us to create ecosystems in which not everybody can just freely participate,” says Amerjeet Singh, platform architect at FairChain. “Not any brand can just join and take the leverage or the benefits of a blockchain-based system in terms of the tractability and value transfer. It will only work with organisations that have a series of chains that are willing to divide value equally and they want to prove their story. This allows us to create certain boundaries for entering.”

The tokens that will be distributed in the products will create a digital trail. Using euro currency, with the use of blockchain the transfer will be instant, with no cost involved. There will also be the added benefit of creating a credit history for the farmers and giving them ownership of their own data.

Tracking

“Every asset that goes through the supply chain is being tracked. That means that you get full insight as a consumer into the people that touch the product and the prices. Knowing exactly if you are paying €2.99 for a chocolate bar, who were the contributors to it and what money did they receive? You can actually see that proof, the places it’s been and the processes it underwent,” says Singh.

All consumers who decide to share their token will get instant feedback on where their investment went and, subsequently, the continuation of the impact that investment delivered via feedback loops.

“They receive the feedback – [for example] some kind of seedling has been bought; they receive a photo that the seedling has been put in the ground and the outcome of the tree that has been grown,” says Singh.

“We believe that consumers do want to invest a bit more and then they have some money on their hands but usually there is a trust level that is just so low. If you can enhance that trust, let’s see what consumers do.”

Consumers are becoming far more aware of the products they are buying and the impact production is having on the planet. Using blockchain is just one of the things companies can do to help conscious consumers make a difference.

“One of the things that we learned is economics alone does not end poverty,” says Stokes. “You need social change, you need environmental change. If you want to protect the planet, the environment, you have to protect the people that work the planet. If you don’t want people to chop down trees for firewood you have to make sure they are not desperately poor and hungry.”

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