Linda van Tilburg (00:01)
From a shipping container in Centurion in Pretoria, Platō Coffee has become one of South Africa’s fastest growing retail success stories. They also now have a foothold in London. Co-founder Stephan Bredell has joined me in the business studio to discuss how they scaled this South African brand globally. Hi Stephan, so nice of you to join us today.

Can we start at the beginning? As I just said, you started in a shipping container. What convinced you and your brother that you could brew something special for South Africans?

Stephan Bredell (00:37)
I think there’s a bit of a backstory. I was a full-time ideation guy at King Price Insurance in Pretoria, and one of my projects was a canteen on the fourth floor. I said, no, let’s do a proper cafe. At that time, we had about 1,000 employees and were doing around 500 cups of coffee a day. So, I had this idea that if you do proper coffee and bring it to the people, so they don’t have to drive to it, there’s potentially a gap to really take coffee to communities. Even before people go to work, they stop at a fuel station or a mall and they’ve got coffee.

That’s why we did the first one out of a container on council ground in Irene. It’s literally next to a memorial garden, and I don’t know if you know Irene, but there was one of the first concentration camps in the world there during the Boer War. They built an oval for people to play cricket and so on. So, we said, let’s put this thing literally in the community and see if it works.

We also said we just want to do proper coffee, to scale specialty coffee. Our big focus was proper coffee in communities, and the first container was a way to see if it was going to work. We rented the container and the equipment, and I never thought we’d be sitting on 170 shops now. That’s the story of the first shop.

Linda van Tilburg (02:27)
Well, real coffee lovers are very picky. I’m one. Were you one?

Stephan Bredell (02:43)
No, and that’s also an interesting story. My wife was one and still is. She got the whole family into coffee, because you typically go from Koffiehuis and Ricoffy, then you get fancy with Nescafé and Jacobs, and then it’s like, no, you can’t, it’s the proper coffee. If my wife drinks me bankrupt on specialty coffee, I guess other wives do it too, so she was a big part of the story.

I wasn’t a coffee snob. Maybe I am one now, or rather I’m not a snob, because we like to say we do specialty coffee without being snobbish. There’s something for everybody. Specialty coffee can be irritating. I always tell the story of when my wife was pregnant. We went into a specialty shop in Pretoria and she asked for decaf, because obviously she can’t drink caffeine, and they were very much like, that’s not real coffee, get out. So, we always say we want to do specialty coffee at scale without being snobbish.

I’m not a big English-speaking guy, but I’d say I’ve developed an acquired taste for coffee. And that differs from person to person, right?

Linda van Tilburg (~03:50)
So how did you scale from that?

Stephan Bredell (~03:55)
The first site was in Irene, on council ground, with an informal trader’s licence, which is also quite an interesting story. To get that first site took us a year. We started searching in mid 2018 and launched on 7 December 2019. I don’t know if you remember what happened in 2020. COVID.

We were open two months and then when level five came in, everybody had to close. Then a month later, at level four, informal traders could trade but restaurants and coffee shops could not. So, there was a bit of a loophole for us. We had an informal trader’s licence, basically a spaza shop licence, so we could open in level four, and we were the only coffee shop open in Pretoria. People phoned me and asked how the hell did you open up, and I said, this is a spaza shop licence. People literally queued. Remember, between seven and nine you could go out for a job and so on. It was so cool to see that coffee has this superpower to connect people and bring them together.

We didn’t plan it, because now our slogan is “Coffee Sculpted, Community Included”, but it almost became our DNA in COVID. As people were closing in lockdown, we started taking up spots. And if we’d had 20 shops in COVID, we probably wouldn’t be sitting here, so it was also a timing thing. In 2020 I think we did two shops, in 2021 about six, and by the end of 2022 we were on roughly eight shops.

Everything we bootstrapped with debt finance, me and my brother. Then we got to a point where we wanted to grow the brand but couldn’t borrow more money, because it was too high risk. People always ask why we franchise, and it’s for a simple reason. One, you want to grow your brand equity. Two, you want to do it without taking on more risk and exposure.

By the end of 2021 I was still full-time employed in corporate, and Petrus was running all our shops and the logistics. Then we started getting a lot of requests, so I told Petrus, let’s do the franchise thing. And I said I’d jump out. The calculation was that I’d have to sell a franchise a month to make my salary. So, we created the Platō Coffee franchise, alongside the corporate stores, and in 2022 I jumped. From roughly eight shops then, we’ll be just short of 180 by the end of the year.

Linda van Tilburg (07:38)
There are established coffee brands in South Africa, you mentioned one of them, and international competitors like Starbucks. So, what is your competitive advantage?

Stephan Bredell (07:48)
I think it’s a combination of things. All the coffee shops had almost gone into this very dark wood, dark spaces look, and I’m the brand and design guy, so I felt we needed to go in completely the opposite direction. We wanted to create the iStores of coffee shops. Whether you’re an Apple fan or not, when you walk into one it’s very aspirational. It’s clean, it’s white, it’s minimal. Because we didn’t know anything about coffee, really, we started with a design and user experience first approach, and I think that’s a big differentiator for us.

We’re in the hospitality game. How do you feel? We’re not just selling a commodity. That flows through to our baristas being friendly, writing messages on the cup. We believe coffee has a lot of relational capital. It’s not just a product we’re selling, and that is our biggest differentiator at the moment.

When we launched in the UK we wondered whether it would translate, the friendly baristas and the way we run our stores. Our franchisees are owner-operators, and we don’t allow managers. If it’s your shop, you need to know people’s names and their orders. It’s nice to see that it is translating in London. If you look at our reviews, 85 percent aren’t even about the product. They say that they’re so friendly, they made my day, which is quite cool to see.

Linda van Tilburg (09:57)
Many entrepreneurs dream of taking their brands overseas. What convinced you to compete in the very sophisticated London coffee market?

Stephan Bredell (10:07)
Especially as a founder and entrepreneur, you always have to have some sense of delusional confidence to think it’s going to work. Even with the first shop, you say, I’ve got a great idea, I’m going to start a coffee brand, and there are already enough coffee brands. For us, London, and we’re also launching in the States next year, with our first shop in Nashville, comes down to the risk-to-reward ratio, in life and in business. We really did risk the whole thing in London. We partnered with a local. In your head, you think, what do you really have to lose? If it doesn’t work, it’s a certain amount, and we’re okay to lose that, but the upside is much bigger than the downside.

For London, we got the right partner, and I think that was one of the biggest reasons we said let’s do it. He’s also South African and has been there for 20 years, so we felt he could take the Platō DNA to the UK. Nashville is also with a South African. We want to take South African flavour to the world. I read the other day somebody saying that South Africa’s best exports are not a product, they’re our people. That’s our approach, and that’s why we’re doing it.

Linda van Tilburg (11:59)
It’s interesting that you say that, because I got a coffee in London yesterday and when he handed it to me, they write your name on it, he wasn’t even smiling. I was thinking, would it cost you anything to just smile at me? I could totally get that. But are tastes different in London to South Africa?

Stephan Bredell (12:18)
That’s a good question. We’ve seen that the London market prefers a bit of a stronger coffee. We have signature drinks, so there was a bit of educating to do. South Africa’s flat white is a bit milkier than London’s, but we do have the Aristotle, which is closer to the UK palate. You don’t want to completely dilute what Platō is, but you also have to educate people on what they like.

On the smiling thing, what I’m seeing in the age of AI, with people being the loneliest they have ever been in the history of mankind, is that it’s pushing people to our brand because they want to feel they belong. When you walk into the store and somebody knows your name, knows your order, knows that your son wrote a test this morning, that matters. We have a story like that.

A guy who’d been away from London for six months came back, walked in, and the barista said, are you back, man, how’s it going, how did your son’s studying go? Stories like that are encouraging, because we’re going almost anti-AI. Starbucks has been busy throwing labour at its stores after going the whole automation route, and it backfired because people want that relational thing, that belonging. It’s nice to see.

Linda van Tilburg (14:06)
Stephan, you also announced a collaboration with a UK matcha brand, PerfectTed, that was a business that attracted the attention of investors on Dragons’ Den, that’s a TV show.

Stephan Bredell (~14:20)
I actually saw that Platō Coffee was doing really well in the UK, and then I connected with Teddie Levenficheon on LinkedIn and we just started chatting. I suggested we launch in London and we really got on very well. When we launched in London, we did a bit of a launch with PerfectTed, and now we’re also the official importers and distributors for PerfectTed in South Africa. It was such a nice story, me and Ted meeting on LinkedIn, launching in London, and then launching PerfectTed in a whole lot of Platō stores. Matcha is a massive trend and talking point at the moment, a massive category.

Linda van Tilburg (15:08)
Matcha is very popular in the UK. Is it popular in South Africa?

Stephan Bredell (15:13)
I think we’re probably two to three years behind the UK. You can see it in Cape Town and Johannesburg, but in the smaller towns there’s still some education that needs to take place. We’re very bullish on it, and it has also done very well in South Africa. We actually met them this week, they were in Cape Town, and they said basically where South Africa is now is where the UK was three years ago. So, it’s nice to see the growth there too.

Linda van Tilburg (15:43)
You mentioned you’re expanding to the US in Nashville. What other expansion plans do you have?

Stephan Bredell (15:51)
In South Africa, I think the sweet spot for us is about 60 a year without diluting the brand and keeping consistency. We can do more, but I think it would be irresponsible. The South African side has a nice rhythm, and now we’re exporting further in the UK. We’re doing another site in February, in Sevenoaks. There are a lot of South Africans there too, next to the cricket pitch, which is quite cool because it echoes our first story, next to a cricket oval.

Like I mentioned, we’re doing Nashville and we’re in talks with people in North Carolina, so we’ll see how it goes from there. We’re also launching, I think this week, two shops in Harare. We opened one in Harare around this time last year, and it’s literally the best shop in all of Africa. Out of all our shops in South Africa, Harare is number one. The only shop above it is London. So, it’s quite cool to see that Africa has a lot of potential. Maybe Botswana next, countries like that.

Linda van Tilburg (~17:00)
When I arranged this interview with you, you said you were going to take a sabbatical for a little bit, so it’s been intense. Sometimes when people look at you, you scaled really fast, and you think, that came easy. It didn’t, did it? You also had other businesses before that were not as easy.

Stephan Bredell (17:31)
It’s a classic thing. People see Platō and think it was an overnight success, but it was a lot of bloody noses, sweat and tears in the trenches. We literally built it from the ground up. I remember we only got a CFO at the beginning of 2024, when we were almost five years old, and by that time I was still designing flyers and so on. It’s been a tough ride, but it’s nice to see there’s momentum now, so in a way it’s becoming fun again. You have to earn it. A lot of entrepreneurs think they’ll come with something and it’s just going to work.

My story is a lot of failures before Platō. I talk about collecting dots in life. Your brain needs dots to connect, and if it doesn’t have dots, it can’t connect something new. For me, the best dot to collect is a failing dot, because you learn a lot from it. Platō is years and years of failing, and then it just came together.

Linda van Tilburg (19:06)
So where’s the division of labour between you and your brother?

Stephan Bredell (19:16)
We started with Platō, so initially I was the brand, marketing and design guy, the look of the shops, all of that. He’s properly the coffee guy. I always say the reason the shops look nice is me, and the reason the coffee is great is Petrus. That’s how we started, because it was just us two and we had to play to our strengths. He had to do all the operational stuff because I was stuck in corporate. I would do the menus, designs and layouts at night. We still bounce off each other on shop looks, but that was how it was in the beginning.

Stephan Bredell (20:05)
As we grew the company, we ended up with a hospitality group called Slingshot. People know Platō, but we have our own roastery, our own equipment company and our own interior architecture firm. I’m actually not CEO of Platō anymore. We got a new CEO in September, and my brother and I moved to Slingshot, our group company. He’s managing director there and I’m CEO. Now it’s fun because we dream together about the next business. We’re acquiring businesses to fit into our ecosystem.

Linda van Tilburg (20:41)
Tell us a bit more about Slingshot. What exactly is that?

Stephan Bredell (~20:50)
It’s basically our group company, like Virgin, for instance. We started with Platō and then launched three other consumer-facing brands. We’ve got three restaurants under The Local. We launched Prima Burgers, which will be about 10 shops by the end of the year. We also launched Lido’s Gelato, a gelato concept. So, we’re building a hospitality group, which we refer to as the Collective, the consumer-facing brands.

Then we’ve got the Works, our platform company. Underneath it we have two roasteries and a bakery, and Sutherland, which imports green beans. So, we have this nice ecosystem that’s vertically and horizontally integrated, and there’s a lot of fun stuff. If something fits the ecosystem, we try to acquire it or JV with somebody. The closest comparison is that we’re trying to build a form of Bidvest with Slingshot.

From a Pretoria container to London, and now Nashville: how Platō Coffee turned friendly baristas into its edge