Behind that stream of steaming hot coffee pouring into your cup is a waste stream of coffee grounds. Nikhil Arora and Alejandro Velez of Back to the Roots (BTTR) view the huge amounts of coffee grounds waste coming out of coffee shops as a huge potential for urban mushroom farming. The UC Berkeley students were in their final semester with corporate job offers in hand when they heard about growing gourmet mushrooms from coffee grounds and independently reached out to their professor for more information. (Read a Q&A with Arora after the jump.)

The professor put them in touch and they got to growing their business idea. They asked Peet’s Coffee for used coffee grounds and set up ten test buckets in Velez’s fraternity kitchen to try out mushroom farming. Only one bucket grew a crop of mushrooms.

They took the single success to a famous Berkeley restaurant, Chez Panisse, to get those mushrooms checked out–they were sautéed and deemed good. (If you’re wondering, mushrooms grown in coffee grounds do not pick up a coffee kick to their flavor.) The two budding entrepreneurs took the same bucket to Whole Foods and caught the interest of store employees. Their idea also caught the interest of their university, which awarded them a $5K social innovation grant.

What’s happened since those early days is remarkable. In six months, the mushroom growing venture went from having product distributed in one Whole Foods to national distribution. Last year Planet Green reported that BTTR became “the sole oyster mushroom supplier to the entire North California region of Whole Foods while transforming over 10,000 pounds of coffee ground waste per week from Peet’s Coffee.”

Peet’s, which sold BTTR’s mushroom growing kits in its shops, proudly proclaims that it is the primary source of BTTR’s coffee grounds, and plans to give them 1 million pounds of grounds to reuse this year. Whole Foods also sells the grow kits and provided the venture with a low-interest loan for local producers.

http://youtu.be/DvQXcUUJAeE

But that’s not all. When these two urban mushroom farmers put up an ad on Craigslist to get rid of their spent coffee grounds with broken mushroom roots, they discovered a market for their own waste stream. The mushrooms enrich the grounds as they grow leaving behind a desirable alternative to chemical fertilizer. It sells as a premium soil amendment.

The White House recently highlighted BTTR as a “Champion of Change” for its sustainable business model. Keep reading to find out more about what Nikhil Arora has to say about growing and eating mushrooms.

As a recent college grad, why did you give up the security of a post-college job offer to become an urban mushroom farmer? Did you ever have any doubts about your choice?

After Alex and I first came across this idea in a class, it was a very step-by-step process our last semester. We brainstormed, ended up growing one test bucket of mushrooms on coffee grounds, had a local restaurant try them and like them, got some initial interest from WF [Whole Foods], a $5k grant from our [university’s] Chancellor–and by that time, with all that support building up from our community we looked at each other sand said “we have got to do this!”

We started seeing the potential for turning waste into food and local jobs and wanted to run with it. The first months were some of the toughest, and there were many days where we would look at each other, knee-deep in coffee grounds, and ask “what are we doing??”–but the friendship that Alex and I developed early on was crucial to carrying us through those early tough days.

The grow kits look way more fun than the Chia Pet I got as a kid, with the major benefit of producing edible mushrooms. Are the kits primarily for educational/entertainment value? Or can the home kits also compete against other mushrooms sold in stores when it comes to taste and price?

The kits are definitely a ton of fun (grow up to 1.5 in as little as 10 days) …by far the most fast growing food out there! However, the nice thing is they also compare on price–and that’s something we really work for because we know for this grow-your-own movement to really take off, it can’t just be a one-off fad/one-time purchase. These mushrooms go for around $12 lbs in many stores, so there’s that price parity right away, but the neat thing is that we actually sell replacement bags & offer a monthly mushroom club online–so those who really want to grow their own food can continue to do so (keep the box/mister) and save money!

What’s your favorite dish featuring mushrooms? Do you eat more of them today than before you started urban mushroom farming?

My favorite dish has to be the mushroom tacos our warehouse manager Osvaldo cooks up–they are absolutely delicious! Definitely eating a lot more mushrooms now than before–have a much greater appreciation for them! 🙂 

What are three things that people can do to build an innovative and sustainable business idea into a successful reality?

1) Focus–especially early on, pick one thing (a product, a service, etc) and work endlessly to become the very best at that one thing, however niche. We learned that lesson the hard-way early on when we were pursuing a handful of different products/services related to this concept, and not focusing on entirety on one..it almost put us out of business.

2) Build partnerships–it takes a village to build a company. Do not underestimate the power of partnerships–find unique partners who can take your brand to the next level, find creative ways to offer them value-add as well from supporting you so they become fully invested in your future, and leverage their networks and communities. Always look to make every partnership a two-way street so you grow together!

3) It’s all about the team! No matter how great an idea is, you cannot build a successful company without an all-star team. It’s not the product or idea that has helped grow Back to the Roots–but an unbelievable team (family, more so!) that all believes in our mission & vision and is willing to work hard & innovate to achieve our goals.