An Interview with Nico & Jeff of Lost Sock Roasters
Nico (left) and Jeff (right) standing in front of their new roaster.
I spent an hour with Nico & Jeff on a Friday afternoon in early February that felt like early spring. They invited me to their new roastery in NE, located in a small nondescript building next to a tow truck company and just down the block from a beautiful old neighborhood. Nico was nice enough to make coffee while we sat at a big wooden table with 20Ib sacks of coffee piled around us and different iterations of prototype merch sitting on the counter. If you’ve met Nico & Jeff you’ll know that I am about to state the obvious; they are both just fun people to be around. They’re quick to laugh and have a great perspective on building a small business for the long haul. Despite all the challenges and late nights that are endemic starting, running, and growing a business, they both still have an infectious sense of excitement and optimism about Lost Sock and its future. They clearly love what they do.
We talked for almost an hour and a half covering a whole range of topics from branding, permitting, and coffee futures to Small Business Administration Loans, how they make decisions, and the responsibility they feel to do right by their team.
They also let me “break” the story that they are launching a new cafe in NOMA that will be part coffee shop, part grocer, and part wine and beer sales as well. You’ll have to scroll to the bottom of this article to hear a bit more about it!
It was great to sit down with Nico and Jeff and I’m looking forward to seeing how Lost Sock continues to bring quality to the forefront of coffee in DC.
This interview has been lightly edited for conciseness and clarity.
So both of you attended American University. I'm curious if you felt pressure to to take on a “professional” job right after graduating or if you were fully committed to Lost Sock from day one.
Jeff: No for sure. I think my dream job after college was to work in some capacity for USAID. Coming out of college I worked for Solimar International, a small USAID subcontractor developing ecotourism projects. One of the projects I worked on was developing ecotourism around Colombia’s coffee trade while working as a barista on the side at The Coupe in Columbia Heights. I never felt pressure to pursue anything specific professionally but I remember when we decided to go full into this, having a phone call with my mom to tell her I wasn't pursuing a career in what I studied in college. Her response was nice but slightly confused, “Then why did we help pay for college?”
Nico: I think it's also somewhat fair for people to expect that you're going to go to college and then go the usual route of getting a traditional job and following what people would call a traditional route. For me, I've always been in the restaurant industry. My dad had a restaurant in Ecuador when we used to live there. I was born and raised in Ecuador and through college I worked at Think Food Group (Jose Andres Restaurant Group). Out of college I went to work for Sweetgreen as an Accountant. But at the end of the day I hated just sitting in a cubical refreshing spreadsheets and telling the store managers what to do to change things.
Coming out of college there was a group of us that wanted to put together a multipurpose space with a bar, art gallery, music space, you know, like a classic third place vibe. Then we realized we're broke college students and couldn't afford it. But Jeff and I were the people behind the coffee side of things.
For me, I was also attracted to the idea of getting coffee from my country of origin, from Ecuador, and while that has never been our whole focus, just doing something that brought me back to my roots was intriguing.
Jeff: I think looking back, we knew what we were trying to do was risky in the sense that nothing was guaranteed. We didn't have any professional coffee roasting experience and very minimal barista experience at that. But we were 21 years old so we decided to try to do it for a year or two. If it works, it works. If it doesn't, we'll be 25, 26. We're still young enough to pursue something else.
Nico: We started as a wholesale roastery. A lot of people came to learn about us when we opened up the cafe in Takoma Park but we had already been in business for five years.
How did you get started? Did you make a business plan and then go from there?
Jeff: We’ve learned that we've taken kind of a backwards approach compared to how most people get into coffee roasting. We didn't have the amount of money that we would have needed to start a cafe.
We were home roasting coffee in our basement apartment in Columbia Heights and just buying green coffee online from all these different countries. We just got more and more into it and then started taking classes through the Specialty Coffee Association to learn how to roast on commercial machines.
We were looking at other DC roasters at the time. There was Swings which has been around forever, Vigilante Roasters who we think does good stuff, and then at that point in time Compass had just started as well. Compared to other places around the country there was not a lot of competition. We thought there was a void for something a little bit more boutique, focused on quality. A lot of the cafés that we loved going to where we would meet to business plan weren't carrying the local roasters. They were carrying roasters from New York or California.
So we found a cheap commercial space. Because we weren’t initially retail focused we didn’t need to be on a busy corridor.
Nico: We DIY’d the heck out of it.
Jeff: We raised a very small amount of money to be able to buy a small roaster and a little bit of inventory for green coffee and we didn't pay ourselves for the first two years. The first two years we both had other jobs.
Nico: I was working full time for Sweetgreen and then eventually left when they were planning on moving to the West Coast pre-IPO. Then I took a job with a coffee distributing company but for offices. They were just starting operations in DC and I was the only one on the East Coast.
In a sense I was kind of starting another company with these guys. I was traveling a lot to New York and I got to see the world from the office side and worked a lot with Counter Culture Coffee and Stumptown Roasters learning how a wholesale business works.
Jeff: And we had access to that big van they gave you which was instrumental.
“Yeah, I mean, the cafe for sure was the turning point, but we weren’t necessarily looking to open a cafe. ”
So what was challenging about those early days?
Nico: The hardest part was approaching an account and seeing if they needed coffee. Everyone would be like “Yeah, I’ll try out the coffee.” But then, you know, we were two 21 year olds and we hadn’t yet proven that we could actually deliver. I think for a little bit it was difficult to kind of get in through the door. Everyone was welcoming but that didn’t mean that they were going to trust us to be their sole coffee provider because we didn't have a reputation.
Who did you start with? Do you remember who your first account was?
Jeff: I think Each Peach Market was the first market.
I love Each Peach Market. Did you start with bagged coffee or were you really focused on getting into cafes?
Jeff: Getting into the cafes, especially the cafes we wanted to get into like TCB was really difficult at first because of our lack of reputation and just being an unknown. So in the early years we sold at the farmers market. We're still at the Petworth Market. We started there and with small grocers like Each Peach Market and Odd Provisions.
Early on it was really important that we try to do a pop up. Like Nico said, people didn’t know who we were and had never really tried our coffee before. We did a really successful pop up in 2017 at Timber Pizza Company. At that point in time they weren't open on the weekends and they weren't open in the mornings. We did Thursday, Friday, Saturday and Sunday there. This was pre-Call Your Mother but Timber Pizza would ship bagels from New York and do the breakfast stuff and then we brought a little espresso machine and did the coffee service.
Nico: I think it was the first time that we were actually seeing a little bit of community building. You know, people coming into the cafe drinking coffee, tasting, and giving us feedback immediately. Before that we would essentially be selling bags of coffee and hoping people brewed it correctly at home. At the pop up we could brew it and get feedback right away.
It got pretty busy and that pop up led to other connections. Bluebells opened up down the street a little later and we helped them with their coffee program there and still do the Farmer’s Market today.
Jeff: Then we did another pop up at Anxo. They used to have a restaurant down on Florida Ave. We did a pop up there right when they opened. We met them because we were neighbors on Kennedy Street. We just tried to pop up in different areas.
So what do you guys remember when you hit critical velocity?
Jeff: Yeah, I mean, the cafe for sure was the turning point, but we weren't necessarily looking to open a cafe. The guy who found us the roastery space reached out and said “Hey, this came across my desk and looks like it could be a cool cafe space. Do you wanna check it out?” We drove up and it seemed too good to be true. It's in the Takoma Theater which is a 102 year old building. It's no longer a theater. It had been vacant for 10 years and then Rock Creek Property Realty bought the building, renovated it, and it took a long time for them to change it. Children's National ended up getting their rights to build basically an outpatient center inside the theater and then there's two commercial properties in the front. There’s us and then Turning Natural which is a fresh pressed juice company. It’s a beautiful old building with tons of windows.
We didn't really know much about it back then but Takoma has always had this reputation of being a little enclave. It gives such small town vibes but you're in DC. It has just like an insane community around it. Laura Barclay from Main Street Takoma (part of the Old Takoma Business Association) does an outstanding job really supporting local businesses.
“The neighborhood really just loves the cafe and we love the neighborhood.”
Nico: Yeah, it's the most supportive community I've ever been part of. We opened up in February 2021. We signed the lease in 2019 or something and then COVID happened, delays, everything and we opened in early 2021 when we were limited to six people inside. On top of that, we got dumped with snow that weekend. We were worried that people weren’t going to come out. All your insecurities are popping up the day you are opening. But people lined up. There was snow on the ground but people were still waiting outside.
There’s some synergy happening with Donut Run across the street which has amazing donuts if you haven't had them. A lot of people were buying the donuts and getting coffee from us and now it's built into something where weekdays are busy and weekends are really busy. The neighborhood really just loves the cafe and we love the neighborhood.
What were those early days like?
Jeff: We saw the business grow a lot once we opened a cafe. We actually had a face.
Nico: And not just that but the team grew a lot. For a long time it was just me and Jeff and then we’d bring in one person full-time or part-time depending on the season. Then we went immediately from two, two and a half, to 10. Then the following year we hired 14 people. Now we have 16 people on staff and a lot of them are full time.
That’s a lot of responsibility:
Nico: If the business doesn't make it for whatever reason, you know, we can find jobs. Now a lot of people's livelihoods are our responsibility and we think about that a lot. We've been lucky with our staff. We have people that have been with us since we opened and most people have been with us more than two to three years.
Jeff: It's something we pride ourselves on and when we're hiring we really try to emphasize that we're a small but growing company and are not just a cafe. We're a coffee company. We have this roastery. We have a bunch of different specialized jobs that maybe don't exist right now but could. It kind of just inspires people to stick around.
How hard has it been to balance the significantly higher price of coffee?
Jeff: It’s crazy. Coffee futures are what dictates the price for all coffee in the market. It had never been above 350 until two months ago and once that happened every single week it has jumped 10 cents and it became the first time it hit 360 then the first time it hit 370. This week it hit 408. To put that in perspective when we started some coffees we could buy for like 285. Now it's 405 base. We still have coffees in inventory that are that are really good quality coffees, high quality coffee for like 385. And that's not even the C price now.
Nico: At the end of the day we're not willing to compromise quality, because, I mean, that would be the one answer, right? We are a specialty coffee brand. I know we're not selling coffee that's cheap. But focusing on cheap coffee versus quality coffee is not our market and we don't want get into that market.
Jeff: There were really bad harvests in Brazil and Vietnam this year because of climate issues. For both those countries to have bad harvests is pretty rare so that cuts down on supply while demand is still going up. Coffee is global, right? So the coffee coming out of Ethiopia traditionally goes through the Red Sea and out through the Mediterranean. For the last 6-8 months all the coffee coming out of Ethiopia goes around Africa. Ocean freight prices are up dramatically which increases prices for the importers and increases the prices for us.
“At the end of the day we’re not willing to compromise quality, because, I mean, that would be the one answer, right? We are a specialty coffee brand. I know we’re not selling coffee that’s cheap. But focusing on cheap coffee versus quality coffee is not our market and we don’t want get into that market. ”
I’m going to ask you about what you love about running a coffee business and also what you don’t like since I have to imagine a lot of parts just aren’t super glamorous. But, let's start with the good stuff, what do you love?
Nico: I think for me what's really cool is the community. I think we were always attracted to the specialty coffee industry because of the people behind it, the beliefs, you know, it’s very inclusive, very international. We’ve met people from literally all over the world. We have friends in Greece, we have friends in Ethiopia, we have friends in Brazil. At the end of the day the people are the most important thing. That's also how we run our business, right? It's all about relationships. You make these relationships at origin with producers and you gotta nurture these relationships and continue working with each other. Then at home there are relationships with the regulars that come into the cafe. There's relationships with our other vendors so it’s a very people first industry which I really appreciate.
On the flip side, what do you maybe not like or what is tough about it?
Nico: It’s just not that profitable of a business. Sometimes the margins seem high but it’s just such a low priced product and when you have the rent in DC you have to sell so many cups of coffee to pay that rent. I think there’s also a lot of other stressors that come through. We’re a growing business so we have to think about where we’re going to get the funds to build a new space. Or, for example, we have the roastery here and we signed a lease and then had to wait a year for permits. So we paid rent for a year before producing a single dollar on it. So that part is the most difficult part of running a business. I feel lucky that there are two of us and we can bounce ideas off each other. But when people are running a cafe and they do everything themselves without a business partner that sounds miserable to me.
Jeff: There's no playbook as a small business owner. We’ve had to figure stuff out by trial and error. There are always a thousand things that need to get done and trying to figure out what needs to get done first and what needs to be prioritized is really challenging.
It's probably hard to balance scaling all of these things at the same time…
Jeff: This is now our second month in this new roastery space and we haven’t officially announced this yet but we also just signed a lease on a new cafe space January 1st. We just got into the roastery and we’ve been waiting to get into the roastery space for two years. We’re finally focusing on all of this stuff and then as of January 1st we’re now separating half our brains on this and then the new cafe. I’m excited, I’m happy about this new space but it’s a lot of work.
Woah, that’s super cool! I’m sure you can’t say too much about the new cafe yet but what can you share?
Jeff: So it’s in NOMA between Union Market and H Street. For us, location is huge. We always get pitched different spaces and a lot of them are downtown. But, in Takoma what we really value is the community. There are a ton of people who live in the neighborhood who just walk over to the shop. You know the quintessential example is TCB (The Coffee Bar), that location, that spot is so cool. It’s also a unicorn because of zoning restrictions. Our shop is similar to that in the sense that it’s a corner spot in a place surrounded by townhouses. There is an apartment above and we’re right below it. It used to be a convenience store and we’re going to have some sort of small grocer element. Think of something almost like a Foxtrot with small specialized grocery items. It also came with a beer and wine license so we have a lot of fun stuff we can do with that. And it has a kitchen so we’re excited to do stuff like take our seasonal jam that's on the Takoma menu and then start jarring it.
Nico & Jeff’s “Best of” List
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Jeff:
OKPB - I usually go for happy hour, everything is awesome.
Your Only Friend - Also has great cocktails and really cool vibe inside.
Right Proper Brewing - Fantastic, and great people.
Nico:
I just recently had a kid so I don’t go out as much as I used to but the afternoon cocktail program at La Tejana is really good. They’re great people and their frozen drinks in the summer are really good.
I’ve also always been a huge fan of A Baked Jointand Baked & Wired. That family has done some incredibly cool stuff and Baked & Wired in Georgetown is an institution.
Finally, I’ve been really digging the bar at Other Half Brewing.
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Nico:
I gotta give Yellow the credit they deserve. It’s expensive but I’ve never had anything that’s bad.
La’ Shukran. We both went there recently. The space is beautiful and it feels like something out of a Wes Anderson movie. All the staff are dressed up and it feels like a movie. It’s just fun and really good.
Jeff:
I’m a Mount Pleasant guy so definitely Martha Dear. I’m there like once every other week.
Thip Khao, just insanely good.
Honorable mentions to Astoria and Green Almond Pantry. Shoutout to Green Almond Pantry because the owner is opening a restaurant now too.
Nico & Jeff:
Albi. Definitely our tp restaurant in DC.
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Nico:
I would say visiting the monuments at night. Rent a bike and just get to the monuments.
Jeff:
I like shouting out Breadsoda. It’s got pool tables, has a good little ambiance in there and it is full of locals.
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Jeff:
Nine times out of ten I got a hot drip coffee. Occasionally I’ll get a cortado too.
Nico:
Usually I do straight up espresso (also just to check on the dial).