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Matcha companies we wish existed · Specialty Matcha Podcast

0:07
And welcome to Specialty March Podcast.
0:09
My name is Ryan. This is Mike Ho Zhongjun who
0:11
also goes by Sam. Hello.
0:13
And we're the Co founders of Sanko March products.
0:16
Yeah, we launched this podcast to discuss on learning journey
0:18
and macho, share startup stories and interview experts.
0:21
And today we're going to try to wrap our minds around like, what
0:28
are there some white space or missing pieces that we can add
0:32
to this very fast developing world of matcha that we are
0:36
seeing today? In the past few years, we've
0:37
seen like matcha literally just exploded all around the world in
0:42
different countries. And most of them are honestly,
0:46
in my opinion, I don't know if you agree with me Ryan, but try
0:49
to copy what specialty Coffee has done in the past.
0:53
And basically a lot of these players are following a very
0:56
similar playbook into like in turning matcha into a specialty
1:00
product. But what can be done
1:03
differently? Or what can be done differently
1:07
in the sense of like what is happening now?
1:09
Because I think that the coffee industry is a fantastic parallel
1:14
because it feels like they're about like 2 decades ahead of
1:16
what specialty matcha could be. And there's been a really
1:19
interesting ecosystem develop. And if you listen to old timer
1:24
specialty coffee people who have, you know, a presence on
1:27
the Internet, you have like, really famous influencers like
1:30
Lance Hendrik and like James Hoffman and then more niche
1:35
people like Scott Rayo or Matt Perger.
1:37
I shouldn't say more niche necessarily, but they don't
1:40
have, like, these crazy YouTube followings.
1:43
Like someone like James Hoffman is clearly tapped into something
1:46
way larger than what any specialty coffee person could
1:49
have thought possible given his viewership.
1:53
But then you, you know, you can go deeper down the rabbit hole.
1:55
And the further down you go down that hole, you find different
1:59
ecosystems, different voices, different people, different
2:01
levels of education. And so you have different like
2:04
players that have emerged and there have there's now a set of
2:08
conditions or has been a set of conditions within specialty
2:11
coffee that can lead to new business models.
2:14
Basically, you know, it's not just that you're a cafe operator
2:18
or that you are a roastery or that you are an equipment
2:21
distributor. You know, these of course still
2:23
exists. But now you can have all these
2:26
other business models which we want to get into.
2:28
And I think the first super interesting one are
2:31
competitions. We talked about competitions,
2:36
you know, and coffee and you know it's, but we very, very
2:39
rarely talk about them through the lens of a business.
2:43
And of course there's competitions within matcha at
2:46
the national level in Japan, but there are no international
2:50
competitions in for brewing, for example.
2:54
So the people who are actually interacting with the consumer
2:57
and understanding what they like, something equivalent to
3:01
like the World Barista Championship doesn't really
3:04
exist for matcha or for tea in generally.
3:08
Which would be really interesting to see either
3:10
adopted into the World Barista Championship or someone creating
3:15
their own version. Yeah, but I, I will foresee that
3:20
a difficulty being like who has the authority to set the
3:24
standards for such competition to exist.
3:27
Like naturally I think people would try to look into China
3:29
you, but different schools of China you in the 1st place have
3:33
different whisking method, different criteria for
3:35
standards. And then, you know, you get like
3:38
you get you, you would naturally get into the weeds of like it's
3:42
like re appropriating like a culture for like contemporary
3:46
thing like who gets to set what and who gets to say what's than
3:50
what sounds very difficult and complex.
3:53
Very difficult and complex. One of the things that inspired
3:55
the topic for this episode. I was listening to an old
3:58
interview that James Hoffman did.
4:00
I've been a fan of his since his the very beginning of his
4:04
YouTube journey. I think I found him in 2018 when
4:07
I was really into Specialty coffee and when he was back
4:09
doing his travel vlog when he released his book.
4:11
I remembered that he actually went to China.
4:14
Yeah, at the time he went to Changsha, where where your
4:17
ancestry is from it. Was pretty incredible.
4:20
Pretty weird thing for someone to do, I don't know, Six years
4:23
ago? And at that time there must be
4:27
like, I don't know, 10 specialty cafes in Shanghai.
4:32
Let alone a Tier 2 city. Most people never heard about
4:35
China. It's super strange but very
4:37
cool. Very cool.
4:39
And he was talking about his experience.
4:43
So for those of you that don't know, James Hoffman was the
4:46
World Bursted champion. Please forgive me.
4:48
It's like 2007 or 2008, something like that.
4:51
He was a world bursted. He was a really early World
4:54
Bursted championship winner and he was doing some retrospection
4:59
and giving some thoughts on how the competition has evolved and
5:03
how it started and actually have a really good quote from him.
5:06
And it goes something like the World Barista Championship was
5:09
designed to give legitimacy to what was a very niche movement
5:14
at the time. And that specialty coffee was
5:17
really actually in its infancy and it wasn't perfect and it's
5:20
still not perfect. I mean, if you you can watch you
5:23
you they live. I think they live stream if at
5:26
the very least they record it. No, I think they they live
5:29
stream it because it was a freshman in college.
5:31
Someone organized a viewing party for the World Bristol
5:35
Championship. Not.
5:36
Really. Wow.
5:38
It was like, really? I guess across the chasm like
5:41
moment. Yeah, almost.
5:43
Yeah. But being on the Internet, yeah,
5:45
we watched it and it's a little absurd.
5:47
Like you're watching someone and there's like 3 people with
5:50
clipboards examining every move. Barbaristas doing like if you
5:55
drop a coffee ground, if you forgot to clean this thing up,
5:58
if you weighed it properly, like all the techniques are being
6:02
judged and it is a little absurd, but at the end, it
6:07
actually has brought the specialty coffee movement a lot
6:11
of legitimacy. A lot of tools have come out of
6:14
that competition. A lot of trends have come out of
6:17
that competition. The single most, what we would
6:20
say probably now is the most important coffee grinder in the
6:23
world. EK43.
6:25
Reason it became popular was because Scott Rayo discovered it
6:28
was originally a spice grinder. I discovered that it made had a
6:32
really good particle size distribution for coffee.
6:35
Who is friends with a guy named Matt Perger at the time, who
6:37
also is a former world barista champion and now runs the
6:41
fantastic blog Barista Hustle. And I've had the pleasure of
6:44
meeting him a couple times over the years at the Specialty
6:46
Coffee Association back at my last job.
6:49
And he it was considered controversial to time that you
6:54
would use this type of grinder in these competitions to make an
6:58
espresso. And he just blew the competition
7:00
out of the water. And overnight the EK43 became
7:04
the new gold standard. It kind of erased a bunch of old
7:08
assumptions about what was good proved Oh no, like actually this
7:12
thing, this new method of of of grinding with this new grinder
7:17
actually can yield very high quality results and shifted the
7:21
entire equipment industry from within coffee.
7:25
Interesting so the participants at the time, they can use their
7:30
own equipment to grind the coffee beans that they.
7:34
Bring into and they select the coffee and now the coffee
7:37
selection is really the crazy part too.
7:40
Just, you know, they will work very closely with different
7:43
farmers who are also kind of innovating because you don't
7:46
want to do things that are last year.
7:48
It creates an incentive cycle to do interesting things, whether
7:53
or not it's re mineralizing your water, whether or not it's
7:58
another big innovation that came out of this is you can freeze a
8:01
gigantic block of metal and you can put it underneath the porta
8:06
filter. So when you're pulling an
8:08
espresso, the hot espresso goes directly down onto this large
8:12
cold metal block and it instantly drops the temperature.
8:16
The ice because it would dilute the.
8:19
Coffee, it will dilute the coffee, but also it spends less
8:21
time hot, so there's supposedly more aromatic and volatile
8:26
preservation, so you have less. So like that was a technique
8:29
that was invented. So this would be really cool for
8:32
our industry to have and it probably will always kind of be
8:37
a joke in the same way that the world Bristol, I mean, the World
8:40
Bristol Championship winning it is no joke.
8:42
But like, it's still a little absurd.
8:44
And a lot of people in the coffee industry, like will say,
8:47
yeah, it's imperfect. But it's like kind of like, you
8:49
know, the the the video that you know, when when you're talking
8:52
about crossing the chasm, like people always reference to is
8:55
like these two people dancing like in a very, you know,
8:59
chilled metal and people start watching these two people doing
9:04
this ridiculous dance and then it later just turns into a big
9:08
party. Like this is something I think
9:10
the specialty matcha community much needed.
9:13
And it would mint, I don't want to call them influencers, but
9:17
like leaders, thought leaders, it mints thought leaders and it
9:20
gives them a platform to then do something with it.
9:23
James Hoffman ended up writing a book and starting and be having
9:27
this crazy YouTube career. Matt Perger is now running
9:30
Barista Hustle, which is the number one like barista
9:34
education platform, if you don't count the SCA, and making his
9:37
own equipment. Like it gives it platforms
9:40
people in a way that gives them legitimacy.
9:42
And it has created this ecosystem and it goes down to
9:45
farmers, it goes down at the equipment level and affects what
9:48
drinks are being put on the menu, right?
9:50
I could totally see this working for Macho where people are
9:53
promoting new cultivars, where people are doing new brewing
9:56
methods. And biggest barrier one is
10:00
probably chanoyu, because you know, Chanoyu is the old and
10:06
historic and quote UN quote right and traditional and
10:09
authentic way of preparing matcha, which leaves very little
10:12
room to innovate forward. And to our our tea friends who
10:15
listen to the podcast. I something that I always like
10:18
to joke about is that there is no Kong Fu in Chanoyu.
10:21
And to break that down a little bit, Kong Fu Cha, it's Chinese
10:25
tea ceremony, but Kung Fu translates a skill or the
10:28
skillful way of making tea. And it's about just developing
10:32
intuition through your senses of understanding, cause and effect
10:36
relationships that create better or worse tea.
10:39
So, you know, using a Yixin teapot versus a porcelain Gai,
10:42
one really can drastically change the taste of the tea or
10:45
the water temperature obviously has a huge impact on the tea and
10:49
how long you let it steep, what the dosage is.
10:51
If you're using a compressed tea like pour, whether or not you
10:55
pick it apart or leave it in a big clump drastically changes
10:59
the amount of surface area exposed or flavor being
11:02
extracted. And then charger, there's some
11:04
like really advanced technique to sort of the hometown of this,
11:07
this idea of being a skillful, skillful Brewer.
11:11
They'll take these beautiful oolong leaves and crush it in
11:14
their hands. And there's different like
11:16
crushing ratios with a crush like 30%, they'll put it in the
11:19
corner of the teapot and layer in the other leaves so that dust
11:23
in that powder. But what they're really now
11:25
controlling for is surface area and for the amount that's being
11:28
extracted all at once. And at the same time lit up a
11:31
cigarette smoked bigly. And squatting on the ground,
11:34
fanning the flames of their little charcoal stealth.
11:37
Quite a scene. Quite a scene.
11:39
So you know, Chinese tea practitioners spend an unusual
11:42
amount of time practicing this Kung Fu and the skill and
11:47
experimenting is very and it's talked about too.
11:50
There's a pretty rich flavor vocabulary for expressing what
11:53
you're experiencing. So your senses and for those of
11:56
you that have studied Chana Yu either Mota Senke, ODA Senke and
12:00
other school of Chana Yu. I am pretty sure I have never
12:04
heard any discussion about how the brewing changes the taste of
12:10
the tea other than maybe don't use boiling water.
12:14
Sometimes in Urasanka you can be criticized, or excuse me, in the
12:17
Motasanka you can be criticized for whisking too heavily, but
12:21
never once are you given an explanation.
12:24
Urasanka is that way Sir. So, but, but you know, it's not
12:33
the type of education where you're given the first
12:35
principles or the foundations to understand how you can express
12:40
flavor through preparation. And when we interviewed Jeb from
12:44
MTCHA few months ago, hearing him talk about, you know,
12:48
whisking time and duration and how that impacts like the
12:53
extraction and how some of the wasting times are into 90
12:58
seconds to extract what is like what the least extractable
13:02
parts. There's a lot of flavor that are
13:05
then locked up in there. And they're totally optimizing
13:09
around what they want to highlight in that brewing.
13:13
It's not just a set recipe or a set ratio.
13:16
So that is one really big structural barrier because
13:18
everyone goes to China U practitioners as the experts,
13:21
but they know nothing about the cause and effect relationships
13:25
in, you know, changing brewing parameters and the outcome
13:29
really very close to nothing. Like maybe there's some
13:32
hobbyists that have experimented with it on their own, but it is
13:35
really a subject that falls outside of China.
13:38
Yu. Although we are seeing some
13:40
reason, I would say innovations within the channel, Yu schools,
13:44
for example, the yeah motto of Edel Adelson K.
13:49
For fun I guess. But I think it's a sign, it's a
13:53
statement that they are embracing, you know, the
13:55
contemporary culture. That's true.
13:57
We were talking with someone in Yamai, the traditional old blend
14:01
house there, and he was like, I just saw an Instagram story of
14:05
the Iamoto of Edo Sanke making usucha with sparkling water.
14:10
This was very, very nice. Very, very nice.
14:13
And I mean, like, I think moving forward, we shouldn't
14:16
necessarily think or trying to exclude channel you out of this
14:21
conversation. Like you'll be actually very
14:23
cool. I think that we can somehow
14:24
incorporate them into the party as well.
14:27
And I think there are people with innovations or innovative
14:31
mindset that exist in that realm.
14:34
Just need to talk to them. No doubt.
14:36
And the way, I mean, there's a lot of like thinking that has to
14:40
be done about the way a competition like this would be
14:42
structured. But ultimately it would be a
14:44
business. Like, you'd have to have
14:45
sponsors, it would have to be an event, You'd have to either have
14:49
a prize large enough or people compensated enough to fly from
14:53
all over the world to participate.
14:55
That structure already exists. Who are baristas?
14:58
In the in the channel your world, right?
15:00
Like the whole Yamoto endorsement situation.
15:03
Indeed. But you know, having this be
15:05
international, outside the scope of China, you would be, you
15:08
know, quite a bit of work, but this type of business could
15:11
exist in the future. It's a mixture of, I guess,
15:14
ultimately advertising and events and a lot of
15:17
organization, but we'd love to see some equivalent to that and
15:20
something we wish. Existed.
15:22
Very true. Very true.
15:23
Another one that's not really a company necessarily, but
15:29
definitely a career that I would like to see is the equivalent to
15:33
what in coffee you would call as a green buyer.
15:36
So like green buyers in coffee, their job is to do quality
15:41
control in the coffee, select the coffee lots, work with
15:44
either importers or producers or distributors, depending on where
15:48
they're buying the green or unroasted coffee from and
15:51
bringing it in as things that will be used as fund components,
15:54
things that are kept as single origin.
15:56
And their job is to basically handle all of that operational
16:00
complexity of buying, of contracting, of making sure it's
16:04
financed and making sure that the sample that you were sent is
16:07
the same as like these 50 sacks of coffee that just arrived.
16:11
Is that the same? And it's quite a bit of work.
16:15
It's a very important job. Sounds much like, you know,
16:18
chashi nowadays. close. Yeah, actually, it is what it
16:22
is. But what we have not been seeing
16:24
is such some person exists outside of Japan in the
16:28
international level, which is, you know, it's for chashi that
16:33
they're basically, you know, tea blenders in Japan.
16:35
That that that usually is the hat of the tea company in
16:39
different region, or at least holds a very important role in
16:42
the tea company because they need to make decisions for
16:46
buying wood in the auction by also purchasing how much or like
16:50
how much quantity and also how much money they should be
16:53
bidding. Which we have heard some what
16:57
used to be very successful charge are not having much luck
17:01
in recent days in the auction because their mental model of
17:05
price has been a little bit outdated because of this whole
17:08
explosion in matcha. But but yeah, Tashi really holds
17:13
a lot of these functions in in the world of matcha.
17:17
But I don't think there's a single non Japanese Tashi.
17:21
We've heard that there is one guy who's trying to become the
17:25
first non Japanese Tashi. Yeah, David from Tazumi
17:28
mentioned he had a friend who's an American that was interested
17:32
in doing it. Yeah, but.
17:34
That's the only one only circumstance I have heard of it
17:38
is you need the skill set of Achashi.
17:41
But having this like at like these different matcha companies
17:44
in the same way that roasteries do like I know if we reach a
17:47
certain size, we absolutely need a green buyer.
17:51
Like if we reach like, like, you know, where we're, you know,
17:54
moving in the metric tons of matcha and we need to make a
17:58
bunch of interesting decisions like that is a full time job.
18:01
Yeah, yeah. But one other obstacle is that
18:05
all of these auctions in Japan are Japanese participants only
18:09
almost. Yep.
18:10
So we it's actually touching a very systematic and fundamental
18:14
inertia or how do you call that structural barrier?
18:18
Structural barrier of the current, you know, system that
18:22
exists largely just in Japan right now.
18:25
Although, you know, I would envision like such precision
18:29
being much easier to to achieve in places like China.
18:34
Oh yeah. There's no such thing as
18:36
regional auctions and Chinese only auctions here.
18:40
The Chinese markets much more practical, thank thankfully.
18:44
But you know, it's interesting the way that this works and I
18:46
think the reason that a green buyer hasn't existed up until
18:50
this point. And you can eventually meet at
18:52
chashi and ask for some level of customization and quality
18:56
guarantees. And you know, a lot of these
18:57
Chashi have relationship with other ones.
19:00
And there's some degree of inter tashi intercompany trading for
19:03
sure going on outside of the auction system.
19:06
So there's some, you know, some movement of product domestically
19:10
within Japan, but there's very little visibility into where it
19:13
came from, how much it was originally.
19:16
You have no idea what people's markup are.
19:18
So it's really very gated and actually for a agricultural
19:24
standpoint for a country's economy, it's really good that
19:29
it's a seller's market. Because if you look at the
19:32
opposite, the idea of having like Q graders and, and green
19:36
buyers and coffee and they have the equivalent in chocolate.
19:40
My girlfriend started her career in, in chocolate and quality
19:45
control and the chocolate fermentation and, and doing
19:47
sensory analysis. So I'm a bit familiar with that
19:52
world as well. Is that you're primarily working
19:55
with the world's poorest countries.
19:57
It is a buyer's market when you're working in coffee for for
20:02
the most part. I mean, unless you're trying to
20:04
source something like Leah Esperelda, Panama geisha or
20:08
something that just has like insane demand or like think a
20:11
Debra or like all of these really, really, really famous
20:15
names, right? Like you're working in poor
20:17
countries where? You know, the average income is
20:21
extremely low and there's which comes with its own complexities
20:26
too, of making sure it's, you know, being processed in an
20:30
approved facility and that has the right testing and the right
20:33
papers for export. It's very much post colonial
20:37
structures that just don't exist the same way in Japanese tea,
20:42
right? The reality of Japanese tea is
20:44
that almost everyone in the industry is properly educated.
20:48
They all have smartphones and they drive nice cars.
20:51
Like it's very first world agriculture.
20:54
And that's a great thing when you compare it to these other
20:56
industry. A artifact of that, a second
21:00
hand effect of that is that like it hasn't yielded the necessity
21:06
of a green buyer yet. I'm hoping as much as becomes
21:09
more international in places like Korea, China, Vietnam,
21:13
Northern Thailand, that the role of a green buyer slash chashi
21:19
type person and who's doing purchasing for people who are
21:22
doing their own blending, milling or later stage refining
21:27
and processing of tensha into matcha can have access to those
21:30
systems. But I think that's part of the
21:32
reason why this just doesn't exist yet, because it hasn't
21:35
needed to. Yep, very true.
21:38
But as we move into the future, getting closer to the product
21:42
and the production and to the agriculture will necessitate the
21:47
need of someone who is taking care of all of them.
21:51
So I hope the the Japanese tea ecosystem can open up a little
21:55
bit because ultimately, I mean, Japan is still a very male
21:59
dominated country, especially in an industry like tea.
22:03
And as I've said many times in this podcast, the majority of
22:06
flavor and quality decisions and price decisions are being made
22:10
by old Japanese men, not exclusively, but most of the
22:13
control and the volume is heavily controlled by old men,
22:17
old Japanese men who don't know what the preferences are of
22:20
people in all of the corners of the world.
22:22
And it's much better off if a little more power is given to
22:27
people that's that are closer to the consumer.
22:29
And a great example of this is that, you know, we've heard a
22:33
lot of stories too of, of farmers that are locked into
22:39
wholesale relationships. They can't even go to auction.
22:42
This is true for a lot of Uji Macha farmers actually, where
22:46
they have these ancient relationships where they have to
22:49
commit way north of 50% of their volume to these large blend
22:52
houses that we all know. And it turns out that last year
22:56
some hand picked to Zumi tea from Uji like Uji itself was
23:02
selling for less than Wazuka machine cut T.
23:08
So like that is a crazy statement and then you ask why?
23:12
Well it it's the equivalent of not being paid because you're
23:18
working for your grandfather who's mind is still in 1990s
23:24
thinking that $5.00 an hour is an appropriate wage to be doing
23:28
whatever it is that you were hired to do.
23:31
Right. The the price that like those
23:33
wholesale companies give those UJI farmers is way lower than
23:40
market price. In the same way that you're
23:42
working for your clueless uncle or your clueless grandfather
23:46
that believe that $5 like $5.00 an hour is an appropriate wage
23:51
when it's not. Well, in reality, I think
23:54
they're just very trapped by this contract system.
23:56
Well, there's no contracts. That makes it even more fuzzy.
24:00
It seems like this whole system, at least from the people we've
24:02
talked to, lives in a whole lot of ambiguity.
24:05
You have to sell and give that volume to the wholesaler,
24:08
otherwise they will never buy from you again.
24:11
And that is your biggest customer and has been your
24:14
biggest customer for maybe 200 years.
24:17
Like that's a scary relationship to exit.
24:19
Yeah. Like they basically people
24:22
exchanged security over, you know, capital gain for the short
24:28
term and for them that there actually lies 2 difficulties,
24:32
right? Like 1, there's no clear
24:34
alternative. Well, ultimately they are being
24:36
trapped by this, you know, legacy purchasing history with
24:40
all these plant houses, which has worked historically, right?
24:45
Like back in the days by macho was not such a popular thing.
24:48
Like all of these farmers can only survive because, you know,
24:52
there were stable buyers coming from these large blend houses.
24:56
And for them that, you know, it's, it's quite a scary thing
25:01
to cut off these legacy relationship with the blend
25:03
houses because then they will be on their own voluntarily or
25:07
involuntarily. It's it's interesting, actually,
25:10
I see a lot of parallel between, you know, this situation with
25:13
some other T production regions too, which shares kind of a
25:16
similar dynamic. So I was just in Laos, northern
25:19
Laos, which is bordering Chinese Yunnan province, which is a very
25:24
large tea production region nowadays.
25:26
And it's considered the origin of tea actually by many.
25:29
But historically, Laotian tea farmers are living in such a
25:34
comfortable stage because buyers will just come into Laos from
25:40
China to procure whatever tea they can get their hands to, and
25:44
they would funnel that back to Yunnan and gets processed as
25:48
Chinese poor. Post CNNP, though, right?
25:51
Yeah, yeah, yeah, yeah. 3-4 decades.
25:53
Yeah, yeah, 3-4 decades post CNNP, but they will get
25:56
processed. Actually, that part is a little
25:59
vague too, because at a time the border was not fixed and there
26:04
were buyers going, you know, between these villages all the
26:07
time. Actually the border was only
26:09
being so fixed and closed after COVID and before then.
26:13
Like a lot of these people can just travel freely between the
26:16
two countries in the. Mountains tea cakes could have.
26:19
Could have Laotian tea It's it's very possible.
26:23
But but, but yeah, so like people really enjoyed this kind
26:26
of dynamic for a long time. And so was tea farmers in
26:30
Vietnam in order these like famous tea regions and they have
26:35
like procurement relationship with all these big, big brands
26:40
and big tea manufacturers as well.
26:43
But recently the the economy has not been so good in China.
26:47
So the domestic consumption of poor has decreased drastically.
26:51
And a lot of these tea farmers have lost their own capability
26:55
to sell their own tea, which they can now only relying on the
26:59
procurement from these large brands.
27:01
A lot of these Vietnan farmers are surviving at the moment
27:05
because these larger brands are still buying tea from them, but
27:09
these Laotian Tea Farm. They got they got shafted.
27:13
They got shafted. These Laotian farmers are in big
27:16
trouble. They got totally cut off from
27:19
the system that the over demand system before.
27:23
So there's there is wisdom for you know UGI farmers to stayed
27:28
in this current system because it is a security in a difficult
27:33
time. And there's an even more
27:35
interesting parallels. You know, part of the reason
27:38
that the poor cycle had boomed so much in the past 15 years is
27:43
there's something called the poor bubble.
27:45
In 2000 and seven, 2008, what happened was a bunch of Chinese
27:51
people became convinced that poor was a good investment.
27:54
Poor is a type of tea that can age.
27:56
And so there was so much material produced that has never
28:01
been consumed. People were buying it.
28:04
They were all these stories of people buying these cakes, aging
28:08
them and then it became an investment.
28:10
So a ton was produced and give away as gifts.
28:13
A ton was produced to sit around an age.
28:16
A lot of uneducated buyers entered the market, a lot of
28:19
quote UN quote stupid money creating this insane demand,
28:23
which turned into a bubble and which then kind of popped.
28:26
And now domestic consumption is still falling for this type of
28:30
tea within China. So in those circumstances like
28:33
this really good forest, ancient forest, ancient tree tea from
28:37
Laos, like was going to that top of the market, but now it's all
28:41
fallen out. Yeah, and and there's even more
28:44
similarities to the current Wuji situation because the Laotian
28:48
tea at the time was so conveniently borrowing the fame
28:52
of poor and Yunnan tea and all of those sub regions that's
28:56
bordering those villages in Laos that just that they're just
29:00
conveniently caught themselves the Chinese equivalent of that.
29:04
But now after them being cut off, they cannot they can no
29:08
longer use those name but their own credibility hasn't been set
29:12
up even though like it is pretty similar in quality and it's very
29:17
similar to what's going on between Wazooka and Wuji.
29:20
Yeah, that's an interesting parallel.
29:22
Imagine Wazooka didn't have a famous name and they had these
29:26
very temporary wholesale relationships that vanished
29:29
overnight. Or all of these sub regions
29:32
nearby wuji. Imagine like Wuji really gets
29:35
like AGI certificate in the future and becomes like has to
29:39
be Wooji. Like what are all these other
29:42
regions going to do? Like Like no one has heard of
29:45
Mia, like in the middle of somewhere Pennsylvania probably.
29:50
But like they have maybe at the time heard of Wuji, but they
29:54
cannot use the name Wuji anymore.
29:56
So that like that it will be a big trouble for these regions.
30:00
Something that Sam just alluded to.
30:02
Mia is a different prefecture, but under the Uji Macha
30:07
trademark. In Japan you can use 100% MIE
30:11
grown leaves so long as they're processed in Kyoto.
30:15
Not Uji in Kyoto prefecture. Anywhere in the prefecture you
30:20
can call it Uji. I mean, you have roughly 1500
30:25
tons of tea that are riding on the name Uji or that
30:30
theoretically can ride on the name Uji.
30:32
Yeah. So if it does get GI.
30:35
Yeah. What are all of these other
30:37
places going to do? Like, we were in northern Kyoto
30:40
last year in Fukuchiyama. Who's ever heard of Fukuchiyama
30:44
as a tea origin? Even people in Japan were like,
30:48
why did you go there? Like it produces like decent
30:51
tea, but it's not like, you know, special cultivars, they're
30:55
using synthetic fertilizer. Like they're producing fantastic
30:59
quote UN quote ceremonial grade tea that would probably work
31:03
great in a Cafe, right? Like it's high quality tea from
31:07
that perspective, but it's actually pretty mediocre tea if
31:10
you're putting it next to a Hamzu Asahi from Shirakawa.
31:14
So you have a lot of not only from this region, but from a lot
31:17
of other places that are making tea in a similar stock methods,
31:21
much more industrial agriculture, not interesting
31:24
cultivars, synthetic fertilizer, and you have a bunch of mediocre
31:29
matcha writing a the Uji matcha name.
31:33
And if they get GI status, that This is why Uji will never have
31:36
AGI status. I mean, there's 4000 metric tons
31:41
of matcha produced in Japan approximately right now.
31:44
And what is that? That's over 1/3 can legally ride
31:48
the name Uji, which is a crazy statement considering Uji is a
31:52
tiny tiny tiny tiny town. It's hard to describe how tiny
31:56
Uji is. There are 35 active farming
31:58
families in Uji, and having about a third of your country's
32:01
production being able to ride that name would be an economic
32:05
crisis as what's happening. Actually, the Laotian example is
32:09
pretty interesting. Yeah.
32:11
And also like all of these other regions, I mean like they're,
32:14
they're basically a extension of the Wuji system or a extension
32:19
of the Wuji style tea. Like they're basically commodity
32:23
supplier for a style of tea that gets made in the very specific
32:27
region in Japan. Whereas these, all these other
32:31
places have their own tawa, have their own climate, have their
32:35
own distinctive tea growing environment and cultivation
32:38
environment and probably accessibility to different sets
32:40
of machineries or fertilizers. The the, the potential diversity
32:45
of the flavor space of Matcha can be huge.
32:49
Well, now all of these places are riding the boat of Fuji and
32:53
just becoming and very comfortably becoming a supplier
32:57
of OJT, which is a very, very unique, you know, tea making
33:02
culture and the specific style of making tea that has been
33:06
developed historically in this very little town outside of
33:09
Kyoto. Actually bringing this back full
33:12
circle, because I was wondering how we were going to do this
33:14
back to our desire to have a green buyer, a tensha buyer.
33:18
What we're going to call green buyer in Matcha is that it can
33:21
help make the other regions famous.
33:25
There is a whole new market that literally has appeared overnight
33:28
in the last like say 5 to 10 years.
33:30
It's interested in single origin products all being like we have
33:35
1/3 / 1/3 of the function produced in Japan can be called
33:38
Uji match. It's not single origin.
33:41
It is. If you're calling it single
33:43
origin, it is a lie. It is.
33:45
There's no objective treatment. You can call Uji style, that
33:49
would be correct statement, but it is not single origin.
33:52
It does not come from Uji. And what's not grown there,
33:56
that's which is what everyone understands when you call it
34:00
something like that, is that these buyers can go.
34:03
The system is locked. If you want to find Joey O Tea,
34:07
you want to find Wazuka tea or Uji Tawara.
34:10
Uji Tawara and Wazuka are becoming it's a little bit
34:14
easier to find farmers that work directly.
34:17
But in a lot of these other regions that people have never
34:19
heard of or less heard of, like E day.
34:23
E day is a little more obscure. Like I am currently not aware of
34:28
anyone selling single origin E day matcha, right, that could
34:32
have a huge market like these green buyers, these Tensha
34:36
buyers coming in. If they can get into the system,
34:41
they can start pulling some of this volume out and making a
34:45
name for these other places who could really benefit and help
34:48
build the future that we would like to see.
34:50
Because you literally just can't get your hands on the material
34:55
controlled in this wholesale relationship system, this
34:59
auction system, this chashi system, which has its merits, as
35:03
we've stated, but it also is holding back what could be a
35:07
very interesting future. Indeed, indeed.
35:10
Wow, that was an interesting tangent.
35:12
This was deeper than I thought we would go considering we only
35:15
got the two professions. Wow.
35:16
It's a complicated situation. We're trying to unwrapped and we
35:20
are touching a lot of I mean like we have seen tea being made
35:24
and being so gold in a lot of different regions so
35:27
differently. It's actually very interesting
35:29
like how the attitude of people treating tea as a tea plant,
35:34
cultivating them and turning them into a finished product by
35:39
the end of the day. And how do they frame this tea
35:43
as part of as part of either lifestyle, either just a
35:48
business or either a very intertwined component of a very
35:54
sophisticated culture? It's just so interesting, like
35:58
the attitude and the perception of tea across different culture.
36:03
And I think a lot of these people doing things so
36:06
differently can really benefit from learning from each other.
36:12
Well, when we were at Basa Nakamura, it was really
36:15
interesting talking to them because they're so aware He's
36:20
processed tea in Taiwan, making Taiwanese high mountain along
36:24
with the producer there, Kundan, and the Thai matcha connections
36:28
that he has in Chiang Rai. It's such a more rich experience
36:33
when you can, you know, leverage what's going on in other parts
36:37
of the tea. World and just have the open
36:39
mind about what's being done in other places.
36:43
It has honestly been very my my, my perception perception and my
36:48
attitude towards a lot of these practices has, has, has changed
36:52
so much in the past few years. It used to be was like we we
36:56
have different teachers or experts in different regions of
36:59
different countries, right. You and I have been to a few of
37:01
these trips back in the teen institute era and you know, also
37:06
as a hobbyist later, I've been following different tea makers,
37:10
tea farmers, or even professional tea drinkers into
37:15
different areas in the world. And everyone talks about their
37:19
own way of making tea or quote UN quote the correct way of
37:23
making tea. But after hearing so many
37:25
stories, you just realized that there isn't really a correct way
37:29
of making tea. Tea is such a versatile thing
37:33
that is so adaptive to all kinds of usage scenarios.
37:38
And by the end of the day, it's just a different flavor.
37:41
There's no right or wrong flavor.
37:43
It's just a different flavor whether or not you like it.
37:46
And it's so interesting like like always had this, you know,
37:50
very negative view towards a lot of tea farming practices in
37:54
Japan in the very early days, the treatment of tea bushes, the
38:00
usage of fertilizer and pesticides and all of these
38:04
things. But you know, like by the end of
38:06
the day, it's part of the recipe of making a version of tea, a
38:11
flavor profile of tea. And if you look into, you know,
38:18
how how tea is being made in China and there are so many
38:22
different style too. And people are like trying to
38:24
call each other out, but these are all a different version of
38:28
making tea. And when even when you're
38:31
talking about, you know, like Chinese matcha, Chinese matcha,
38:35
like, I cannot forget that, you know, our, our friend in Baisa
38:38
Nakamura brought out this matcha and his eyes were lit up and he
38:44
just had this big smile on his face and like, try, try this
38:48
Chinese matcha. It's delicious.
38:51
Like that was my first time hearing a Japanese tea person
38:55
telling me that sentence. And.
38:57
Very rare. Very rare and it was actually it
39:00
was good. It tastes like white chocolate
39:02
and with some very interesting roasted notes.
39:05
It's a very distinct flavor profile and was not bad.
39:08
It was actually pretty good and, and just the fact that, you
39:10
know, people have such an open minded, you know, perception
39:14
towards tea and towards how tea gets made, I think it's just
39:19
super important and super fascinating and super fun.
39:24
The least thing I want to do by the end of the day is drinking a
39:28
weird tasting cup of tea and hearing like this uncle grandpa.
39:33
Just like renting at other people's tea and complimenting
39:36
himself of making the best tea in the region.
39:39
That's my reflection. You see that everywhere, but it
39:42
does feel a little concentrated in Japan with some of these
39:45
people with some very armchair ideas about what's right and.
39:49
Wrong. And in China too.
39:50
It's honestly the same thing, speaking different languages.
39:55
They're the same people. All right.
39:57
So that's one and two. So preparation, competition,
40:00
something. Equivalent to the World Barista
40:02
Championship and Green Buyer. Another one that I had is
40:06
something we need a Mr. Coffee pot.
40:09
The Mr. Coffee pot, it was such a powerful tool for households
40:14
in the US, but households all over the world for people who
40:18
need a very simple way to prepare something without
40:21
thinking about it, that's semi automated, that's cheap and
40:25
gives you a decent result. What is Mr. Coffee Pot?
40:29
It is like the world's cheapest drip Brewer is, you know,
40:33
imagine like a hotel coffee maker.
40:35
There's a reservoir for water, there's a little pump, a heating
40:38
element and drips it over the cone coffee, a cone of coffee
40:43
and outcomes the coffee it's. Interesting.
40:47
Actually, I saw some company trying to do that in China last
40:50
year and they're trying to seal Matcha into kind of like an
40:54
Nespresso. Capsule.
40:56
Oh, that's right. But what I have heard, I
40:59
actually haven't personally try, but I've heard that the product
41:02
is very bad. OK, they taste very bad and I
41:06
think that's maybe. They just need.
41:07
Better matcha, But I think that's one obstacle for, you
41:11
know, matcha. And when we compare it to
41:13
coffee, is that like that much really tastes bad?
41:17
Yeah, That's like gift. That coffee has is coffee.
41:20
Is like it's still like acceptable most of the time.
41:23
I just like the taste of quote bad coffee like I have no
41:27
problem drinking like instant coffee, Nescafe or even just
41:33
some like really old like pre ground over roasted stuff.
41:38
Like in the right context, like it still has some pleasant
41:42
aroma. Like you can find the flaws if
41:45
you want to real, but like bad coffee still tastes pretty good.
41:49
Yeah, like it still tastes like coffee.
41:52
And smells like coffee. But like like random can of bad
41:55
matcha that's old and brown, just horrid.
41:59
That fish or like or in plastic some horrible smell it's.
42:05
It's very, it's unpleasant, but I know, I think, and you know,
42:08
you could substitute the words Mr. Coffee pot for Nespresso or
42:12
for Keurig any like very easy way.
42:16
And you could argue that the cousin, you know, might be the
42:18
closest thing. And there's some companies now
42:20
that are making matcha Nespresso pods.
42:23
I mean, there is such a thing as instant matcha.
42:25
I've never had anything that was prepared, you know, at the
42:29
moment that really tasted very good.
42:31
And the cousin is probably the top of that list.
42:34
That's the combination of convenience and deliciousness.
42:38
But it'd be really cool if I mean, even the frother stick, I
42:41
guess is the closest thing that the industry has to like kind of
42:45
make it a little easier on someone.
42:47
But I think there's a lot of room in the matcha equipment
42:51
space where someone can develop something where it's push
42:55
button, put in my own matcha and make it taste good.
42:59
We're put in my own tension and there's some milling and mixing
43:02
going on and make it taste good. At the end of the day, I think
43:05
it's very sad that like this all has to just be so complicated
43:11
for like people to brew every day.
43:13
And that, you know, it's great if it's your morning ritual, but
43:16
there are so many people who it's just not, it doesn't fit in
43:20
within the context of their life.
43:23
They don't want to think about it.
43:25
If you think about the number of people who buy Nespresso
43:27
machines or that buy even like this, like the new fellow
43:31
equipment that's like ultra automated, it just produces
43:35
something good and it's like 1 less thing to think about every
43:38
morning. And there's a huge market of
43:40
people that wants their match a moment every morning, but
43:44
there's an even larger group of people that don't want that.
43:49
And it's context specific. I hate doing it 80% of the time.
43:55
I don't want my matcha MO. That must be crazy for probably
43:58
some people to hear considering the profession that we are in.
44:02
I don't enjoy making much. 80% of the time I don't.
44:07
It's a pain. It's a pain if you don't have
44:09
access to a temperature controlled kettle.
44:11
It's a pain to hydrate the chassen, to pain to clean
44:15
everything afterwards. It's great in the right mind, in
44:18
the right context. It's not great every day and one
44:21
of the reasons why we made it made our first prod product, the
44:24
Obsidian 1 dimensional macho whisking bowl is to kind of just
44:27
take one less thing off someone's plate who's making it
44:31
and where you don't have to have the perfect zigzag technique and
44:34
anti splash feature. And you know, at the time it was
44:38
less common to see a bowl with a spout, believe it or not.
44:41
Actually, when we first made that product, I kind of saw that
44:44
as AI mean they existed. But you know, something that was
44:47
heavily advertised as form and function for matcha whisking, it
44:52
felt a little bit more of a novelty than it is now.
44:55
Yeah, indeed. But I think the the ecosystem
44:58
for this equipment is is really could be really cool.
45:02
Yeah, and we are solving them 1 by 1.
45:06
Another company that I think would do so well and this is
45:09
really more of a passion project is an aged matcha or an aged
45:15
tensha library of someone. There have been a couple
45:20
initiatives in coffee. If you go to any of the high end
45:23
coffee places in like Paris, for example, like Substance or
45:26
Motors Coffee, they have entire sections in the menu where they
45:29
sell 20 to $25 a coffees. And they're all pre portioned
45:34
and zip locked or like vacuum sealed in a tiny bag in very
45:40
cold freezer. And it kind of just preserves it
45:43
there and it's prepared to order.
45:45
And you're able to have this huge library of different
45:49
copies, different harvests that are have become relatively
45:52
stable because they're kept at such low temperatures.
45:55
And we've heard that like 5 year old or 10 year old Tensha, when
45:59
kept at low temperatures, actually has some pretty like it
46:02
preserves it pretty well. And we learned from Ian from you
46:06
know, me who is an early guest on the podcast that you have of
46:10
that amino acids degrade slower than catechins.
46:14
So you actually get a catechin and amino acid rebalance and
46:18
catechins are bitter and astringent and those will lower
46:21
very slowly over time. And the amino acids, which are
46:24
sweet and savory and mommy stay preserved.
46:27
So you get a rebalancing effect with the aging of this tension.
46:31
It just be like, this is my like vision for like the top of the
46:36
mountain. The binnacle matcha experience
46:39
would be someone that has the ability to milk fresh small
46:42
quantities of tensha that are kept in storage and you just
46:46
build up this reference library to have the same thing as like a
46:51
deep wine cellar. Like when wine lovers go to a
46:54
three Michelin star restaurant, you expect depth and breadth in
46:58
a cellar of different things and having that same thing be about
47:03
it doesn't even need to be particularly expensive.
47:06
I mean, the most expensive tensha that you can buy if
47:10
you're buying wholesale, you know, the competition grade
47:13
stuff is maybe 4 or $5000 a kilo, right?
47:18
And that's a kilo. And when you're like calculating
47:21
that per serving, actually that's easy enough to do right
47:23
now, at least the wholesale rates if you're buying something
47:26
$5000. That's five, $5 a grand, $10.
47:31
It's $10. $10.00 for a serving. For like the best matcha in the
47:36
world, that is crazy. Per serving matcha is like
47:42
orders of magnitude cheaper per serving than some of the finest
47:47
wine in the world for example. That's criminal almost that it
47:52
can be that cheap and any consumers listening, you can now
47:55
backtrack your the margin that people put on competition grade
47:59
tea when they sell it and some of it is higher than 5000 kilos,
48:06
$5000 per kilo, but. Well, the good news is you can
48:11
indeed age tenure. Take notes.
48:14
Renan Lao ban. You can age tenta.
48:16
Oh no. Yeah.
48:17
So that's that. That is a business that I would
48:20
love to see at the high end of the market market.
48:23
And you know, who knows, maybe we'll start doing this as well
48:26
when we have more money to invest after we sell a lot of
48:29
these mills. It's something that we would
48:31
personally like to see. Let's go buy some fridges.
48:34
Freezers, deep freezers. Freezers.
48:37
Freezers. All right, Sam, wanna do one
48:40
last one and we'll wrap it up. Well, the last one will be
48:44
companies that look and feel like equivalents of Onyx or say
48:48
coffee or small Batch or all of these like coffee Roasters or
48:53
even like kind of like a coffee Cultural Center, like
48:57
counterculture that's doing a lot of value add than just not
49:01
just making coffee or serving coffee.
49:04
Like there are a lot of these value add that all of these
49:07
suppliers that are adding into the sphere of coffee culture.
49:12
And we really want to see that to happen for Matcha as well.
49:16
Yeah. And we're starting to see that
49:18
now, you know, a lot of. Yeah.
49:20
Bit by bit. You could, you could argue that
49:23
and I, I'm hesitant to give examples because I feel like I'm
49:26
going to leave people out. But like 2 very famous in the
49:29
examples in the US might be someone like a Kettle or an
49:33
Ouika where, you know, they're milling fresh, they're
49:35
highlighting farmers, they're doing educational workshops,
49:40
right? Like it becomes this like sort
49:42
of center of gravity in a commercial setting.
49:45
And the commercial setting is so important because that's how it
49:48
becomes sustainable and how getting commercial access to
49:51
things like that's great. We can talk about Narino all day
49:55
and what an incredible cultivar it is, but until you taste it,
49:58
it's just something you've heard about.
50:00
It's just words. Like if you have a place to do
50:03
it and people to teach you who know how to prepare it and have
50:06
the stuff and have the theory and sell you the stuff, like
50:09
then. Becomes an experience.
50:11
And this is really, I, I would say the best way to grow the pie
50:15
larger because, you know, that's something that people can very
50:19
passionately talk about to their friends or to their family
50:23
members or to their kids or to their parents.
50:26
And this will really become big instead of, you know, just a few
50:30
real videos or some words on a book or article telling you how
50:35
amazing a tea is or how amazing a cultivar is.
50:39
And one of the things that we're so grateful for is that all of
50:43
our beta program members who've pre bought one of our mills have
50:48
that community. They are these type of matcha
50:51
companies in the equivalence of an Onyx coffee or a say coffee
50:55
more small batch from Australia. They're like they're all local
50:58
and so tapped in to the communities and what's going on
51:02
and doing education and sourcing interesting things.
51:06
And we're just so honored to be a part of what they're doing by
51:10
us, like bringing in the mill. And we're so excited to learn
51:14
from everyone when we travel to all of those places to do or to
51:18
half of those places to do these implementations in the US and
51:22
other countries in Asia and in Europe, part of the
51:25
implementation list. And we're so excited to see how
51:30
that is getting expressed in this new culture that is being
51:34
formed in these places. So, you know, companies that
51:37
look and feel like these famous coffee company equivalents,
51:41
we're in the really early innings of it and it's just
51:44
blossoming into exactly what this the name of this podcast
51:49
is. It's blossoming into this
51:50
specialty matcha movement, which is I think, a perfect place to
51:54
end. Yes, indeed.
51:56
So thank you so much for listening and if you enjoyed it,
51:58
please consider sharing with a friend and let us know which
52:01
Matcha companies you would like to see exist in the world.
52:05
We'd love to know. Feel free to drop a comment or
52:08
give us Adm and very curious to hear like how you would like to
52:11
see the future of Matcha be written.
52:13
Awesome. Thank you in the future.
52:15
Thanks so much. Bye bye.