New York-based coffee company and self-described “Australian lifestyle and hospitality brand” Bluestone Lane has announced it has closed on a major funding round, with plans to grow from its current count of 30 stores to 60 stores in 10 cities over the next two years.
According to a Bloomberg report, the large minority investment is valued at $19.5 million, and Bluestone announced today that it was led by RSE Ventures, the private investment firm founded by real estate mogul and Miami Dolphins owner Stephen M. Ross and partner Matt Higgins.
Bluestone Lane said that in addition to its goal of 100 percent retail growth, the investment will help the company develop its consumer packaged goods and “lifestyle media” businesses. Australia has a thriving high-end coffee retail culture, though the definition of “Australian-style coffee” remains a murky marketing concept. According to Daily Coffee News’s own review of marketing pitches involving Australian-style retail coffee concepts in the United States, it typically involves some combination of the following elements: 1) An Australian is an owner; 2) There is a flat white espresso drink on the menu; and 3) Avocado on toast is on the menu.
“This is a transformative investment for Bluestone Lane, which started from modest beginnings in midtown Manhattan, and the consummation of this partnership provides an incredible opportunity to build a global lifestyle and hospitality brand,” Bluestone Lane Founder and CEO Nicholas Stone said in an announcement of the investment today. “We have a tremendous amount of admiration for Steve, Matt and the entire RSE family, and it’s really humbling that they personally believe in the potential of growing our brand together. In this rapidly changing digital world, Bluestone Lane seeks to provide our locals with a genuine daily escape, where they feel special and connected to our brand and team, whether that’s for a quick coffee or a full meal.”
Stone launched Bluestone Lane in 2013, and the company has seen exponential retail growth through private investments over the past two years, building a cult-like following in New York while recently expanding to urban and suburban markets in Pennsylvania, California, Washington D.C. and New Jersey. According to the Bloomberg report, the company plans to expand into Austin, Texas, and Boston, as well as to the international markets of Canada, the U.K. and Asia.
The growth trajectory of Bluestone Lane resembles an accelerated trajectory of Third Wave coffee forebears such as Stumptown Coffee Roasters, Intelligentsia Coffee and Blue Bottle Coffee — with a series of private investments escalating retail growth in booming markets filled with affluent young adults. Each of those forebears has since been acquired; Stumptown and Intelligentsia by JAB-owned Peet’s, and Blue Bottle by Nestlé.