TAMPA — Tampa-based private equity firm ProspEquity Partners paid $18.2 million less than three weeks ago for a two-thirds stake in Tierra Nueva, a Miami company with a new idea for coffee, and already it has some big news.
Tierra Nueva has inked a deal with Dunkin' Donuts to help market its "coffee thins" — they look like chocolate, but they're actually sweet, creamy wafers made from coffee beans. The wafers will be produced in four DD flavors: original, caramel, peppermint mocha and pumpkin spice.
Food scientists at Tierra Nueva have created a way to convert the coffee bean into a food that can be used not only in drinks but in products from baked goods to frozen desserts.
"They've been able to accomplish something that no one else has been able to do," ProspEquity Partners CEO and managing partner Christopher Ramonetti said in a telephone interview from the Sweets & Snacks Expo trade show in Chicago, where the merchandising agreement was announced on Monday. The wafers have about a third of the caffeine as the average cup of coffee.
"It's the first time that coffee has truly been confectionized," Ramonetti said. "It's not an extract. It's not a flavoring. It's coffee."
With 500 million cups of coffee consumed daily in the United States, Tierra Nueva seemed a good way for ProspEquity to move into the consumer packaged goods business, Ramonetti said. The goal is not only to reach Dunkin' Donuts' 12,500 stores, but also grocery stores and other retailers — about 150,000 in all — that sell Dunkin' products.
Tierra Nueva already sells coffee thins through 7-Eleven and Wawa, but the company hopes to pitch its product to scores of other retailers at the Chicago expo this week. The company's manufacturing facility is ready to handle production for more than $180 million in annual sales. By comparison, last year the company had sales of less than $10 million.
"We're scaling this very quickly, coming to market very quickly," Ramonetti said. ProspEquity had been working with Tierra Nueva since last summer and was closely involved in the talks with Dunkin' Donuts, which signed a contract to carry the coffee thins the day after ProspEquity closed on its investment in Tierra Nueva.
Contact Richard Danielson at email@example.com or (813) 226-3403. Follow @Danielson_Times