Power Up! College Kids Create Coffee You Can Eat

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By Erin Barry | @erincstefanski

Breakfast may be the most important meal of the day, but for some it's that morning cup of joe they can't live without.

But Northeastern University sophomores Ali Kothari and Johnny Fayad may have found a new way to get that morning fix.

"We were constantly running late for our 8 a.m. classes and never had time to eat our breakfast and, more importantly, drink our coffee. So we thought why can't we eat our coffee?" Kothari said.

The co-founders had 60 seconds to pitch their java start-up New Grounds Food to a CNBC "Power Pitch" panel with Patrick Chung, founding partner of the Experiment Fund; Lauren Jupiter, managing partner with Accel Foods; and John Moore, co-founder of Nobletree. Will they convince the panel they have what it takes to win this frothy market? Watch the video above to find out!

Building Buzz

Kothari and Fayad met in their early morning financial accounting class, which they both struggled to make on time.

This was in February, and the two became friends as the idea for edible coffee started to percolate. Kothari and Fayad experimented with different recipes out of their dormitory kitchen. After nailing down a recipe, they pitched their product at Northeastern's "Husky Startup Challenge." They won audience favorite and started selling their coffee bars to a local cafe.

Young entrepreneurs invent coffee you can eat
Source: New Grounds FoodAli Kothari and Johnny Fayad cooking up a batch of their fair-trade coffee bars.
Soon after, the co-founders scored an angel investment of $45,000 and used that capital to produce their coffee bars in Washington state. This move upped New Grounds' manufacturing capacity to 3,000 bars in four hours, from 300 bars in eight hours.

Each coffee bar is the equivalent to a full cup of fair-trade coffee -- which has 102 mg of caffeine. The bars also contain cashews, almond butter, espresso, chocolate chips, cinnamon, gluten-free oats, chia seeds and dates.

"Each bar has 12 wholesome ingredients, ones you find in your pantry and not the laboratory. That means no additives, no preservatives, no nonsense," Kothari said.

new grounds food eat your coffee
Right now only one flavor is in production: mocha latte. The founders say they have more flavors ready to go (such as caramel macchiato and peppermint mocha) and hope to get them on the market after they raise more capital.


According to a report by Market Research, the projected U.S. retail sales of food bars will hit more than $7 billion this year and will grow 6.5 percent annually, surpassing $8 billion by 2016. That includes cereal/granola bars and energy/nutrition bars.

Jupiter asked how New Grounds Food could stand out from the competition, given an already crowded energy-bar market with well-known established brands such as Cliff, Kind and Larabar.

"We have real fair-trade coffee in our bars," Kothari said. "So we're not using anything synthetic. And we use all-natural ingredients ... there are no other bars that are using purely fair-trade coffee."

new grounds food eat your coffee
So far, their Kickstarter campaign has raised more than $25,000, surpassing its initial goal of $10,000. The campaign runs through Nov. 6.

New Grounds raised an initial investment of $45,000 from investors Michael Bronner, co-founder of Unreal Candy, and Bob Robotti tof Robotti & Co.
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