Lykke was launched in Stockholm last year by a group of longtime European specialty coffee professionals, including Lykke Co-Founder and CEO Johan Damgaard, who formerly represented the Johan in Johan & Nyström, the Swedish Third Wave roasting company he co-founded in 2004.
Lykke’s partnership with Wave gives the Hamburg-based, coffee-focused investment firm a minority stake in Lykke. The financial terms of the deal have not been made public.
With numerous past coffee industry executives as partners, Wave has previously invested in other coffee ventures such as cold brew systems maker Bkon, commercial brewing equipment maker Tone, and the nonprofit Orang Utan Coffee Project.
In an announcement yesterday, Lykke said the deal will help the roasting startup increase distribution of coffees and related equipment, while helping extend the brand to international markets.
Lykke, whose name references a Nordic concept of happiness, boasts of a business model that provides improved compensation for farmers through vertical integration involving company-led coffee processing stations and “role model” farms. In doing so, the company says it hopes it can maintain a direct connection between small-scale farmers and the premium specialty coffee market through its own sales direct to consumers and to clients in the horeca segment.
“Rather than just sourcing coffees from select farms, Lykke joins together in financial partnership with farmers and invests as an owner in their organization, agricultural development, and processing capabilities,” the company said in yesterday’s announcement.
Lykke has launched with five company-led farms in Peru, El Salvador, Uganda, Brazil and Panama, while roasting occurs in Stockholm under the watch of head roaster Benjamin Norman, formerly the head roaster at Sweden’s Drop Coffee Roasters.
Though the precise nature of the Wave partnership has not been made public, Wave does operate its own specialty coffee equipment and distribution business. In yesterday’s announcement, Lykke’s Damgaard said, “With this partnership, we have the opportunity to execute our growth strategy and expand into new businesses faster.”