You don’t need to study an MBA at INSEAD to know that people want coffee and they want it fast. You do need it if you plan to open a coffee chain that is tech-enabled, award-winning and affordable.
Flash Coffee is the brainchild of MBA at INSEAD graduate Sebastian Hannecker, made possible by all the connections — big and small — he made at the top business school’s outpost in Singapore.
With Flash Coffee, you can forget queues and the frustrations of shouting your name out to confused baristas in loud, busy cafes. It offers easy pick-ups, payments, loyalty programmes, personalised promotions and interactive challenges — all in one app.
Even though Flash Coffee only launched at the beginning of last year, it already boasts significant investment by companies such as White Star Capital, DX Ventures, Global Founders Capital and Conny & Co. When Flash Coffee decided to raise money to help launch new outlets, their funding was led by White Star Capital and this resulted in US$15 million. This means expansion in the Asian region to countries like Hong Kong, Taiwan, South Korea, Japan, Malaysia, the Philippines and Vietnam.
We caught up with the German entrepreneur to learn more about his MBA at INSEAD, how he transformed his coffee addiction to a business and how he’s fuelling Flash Coffee’s rapid expansion in Southeast Asia:
Where did your interest in mathematics stem from? Is there a personal backstory behind this?
I felt a fascination for numbers early on in life. For example, in primary school I remembered the jersey number of every single player in the German soccer league. Looking at the science of mathematics, I have always deeply appreciated the logic and neatness of it.
In particular, I love the fact that in maths compared to other fields, there is only one single right answer to a problem. Besides that, I have always been a very rational person and when carefully comparing maths to other study programmes. It appeared to yield the best tradeoff between my personal interests, skills and career prospects.
Why did you choose to do your MBA at INSEAD?
INSEAD is, by far, the most popular business school among European Bain & Company consultants like myself. Of course, the fact that INSEAD is consistently ranked among the world’s top business schools plays a major role too. My main reason was the fact that INSEAD has a campus in Singapore.
Why? My INSEAD application status (100% original): “During my time living and studying in Indonesia as well as through several trips to other ASEAN countries over the years, I experienced that South East Asia is one of the most vibrant, culturally diverse and dynamic regions in the world. I developed a deep connection and fascination for the region which fuelled my decision to pursue my career there. Naturally, I’m looking forward to being based in Singapore during the INSEAD MBA programme since I will be able to further explore and build my network as well as remain connected with friends I’ve made there for the past years.”
Well, I meant it. I joined Bain & Company’s Jakarta office right after INSEAD thanks to the connections made with local leadership on campus. Two years later, I founded Flash Coffee in Jakarta, Bangkok and Singapore. The rest is history. I’m incredibly grateful that my MBA at INSEAD experience opened the door to this amazing journey I’m experiencing now.
Walk us through your career trajectory with Flash Coffee. Where did your inspiration come from and why the sudden interest in a coffee company in Asia?
Coffee, especially from well-known brands, is extremely expensive and hence inaccessible to the Asian middle-class. For reference, the average Indonesian’s daily income is equivalent to two or three Starbucks lattes. At the same time, the customer experience at most coffee chains is far from what consumers would expect from a contemporary business.
The majority of this industry is still full-run offline and lacks convenience, leaving incredible opportunities for digitisation and optimised processes. The value for money appeared much smaller than expected (well-known coffee chains often sell mediocre coffee at premium prices).
We noticed customers were constantly paying high prices for coffee from large outlets with extensive seating in expensive neighbourhoods, while the majority of orders were to grab-and-go. These insights made us want to democratise high quality coffee in the APAC region and being huge coffee lovers (addicts), we decided to take the plunge and build a business around a product we love.
I remember when Rocket Internet approached me about the opportunity to build a company with them and soon after, Alexander Kudlich introduced me to David Brunier, an entrepreneur at heart who is also a visionary, incredibly intelligent and a creative individual. Brunier had just started working on a very exciting coffee project and was looking for a cofounder for what was about to become Flash Coffee.
We clicked the minute we met and shared a similar idea of how we envisioned to build our company. We also connected on a personal level very quickly and joined forces in a matter of days — the rest is history!
How do you use the knowledge and skills gained from your MBA at INSEAD course now?
I do get to apply many of the theories I learned during my MBA which includes microeconomics (theories and frameworks useful to determine prices), accounting (I had to manage the books by myself in the beginning), and finance (principles of company evaluation for fundraising).
Additionally, the art of negotiation. My role naturally revolves around this especially in recruiting, when leasing real estate leases for shops or with suppliers and partners. Here, I apply concepts, research and tools I learned during the negotiation course at INSEAD.
The most impactful takeaway though, is the amazing network of incredible, like-minded and driven people. INSEAD is by far the number one target school to recruit talent — our managing directors in Thailand and Taiwan have done their MBA at INSEAD. My network at this school also led me to get funding opportunities for my company.
What skills or knowledge do you wish you had learned more during uni?
As the majority of my work is recruiting, managing and guiding my team, more practical tools based on the science of human psychology and general business best practices would have come in handy.
What advice do you have for international students who are planning to enroll in the same course you did?
I encourage every international student to heavily invest in forming friendships with classmates from other parts of the world with different backgrounds. An MBA at INSEAD is ideal to do so since it’s one of the most international and diverse programmes out there.
This sounds obvious but I have often observed that while being abroad, internationals mostly hang out with classmates from their own country, region or similar industry backgrounds. I consider this human comfort zone behaviour. I tend to fall into this trap too, but I also learned stepping out of the comfort zone can provide one with an amazing opportunity to broaden one’s perspective on life and business.
In 10 years, where do you envision yourself?
Since I never liked the German winter, I will most likely live somewhere with 365 days of warm weather. Business-wise, I will most likely still be engaged in the startup environment because I think this is the most exciting space of the economy due to the focus on innovation and disruption.
In terms of industry besides F&B, I am most passionate about human health and longevity — in particular about business models focusing on the megatrend of moving towards avoiding illnesses versus today’s focus of medicine curing illnesses.
However, I could imagine being in a less operational role than now. For example, moving to the investment side as an active and advisory than purely financial investor leveraging my operational experience in building companies from scratch.
What’s one thing you missed from home and how did you substitute it?
Family and friends are the first thing that comes to my mind here. However, nowadays thanks to technology, it’s incredibly easy to stay in touch via texting and video calling. Also, most of my friends and family love travelling (especially to South East Asia) so I have most of them visiting me on the regular.
On top of that, two of my best friends from home have also moved to South East Asia which motivated my own move. It’s amazing that we can deepen friendships in a completely different environment.
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What advice would you give an international student abroad on how to budget and manage finances wisely?
This may sound counterintuitive, but I would advise to study abroad, if possible, with a loose budget. Why? Because it’s a once-in-a-lifetime opportunity to make friendships with amazing people, gain new perspectives on life, explore new cultures and frankly, to have loads of fun in a short timeframe.
Fully capitalising on these chances unfortunately often result in higher spendings through dinners, social events and weekend trips — especially in an expensive city like Singapore — which was more than worth it for me.
The potential for one’s finances is also limited when looking at the bigger scheme of things. I also want to point out that science clearly shows that investing in experiences yields more sustained happiness over-investing in goods.
So you might want to spend a bit more during your studies but implement a more frugal lifestyle before and after. That’s how I approached it — earning a decent salary after my MBA in a tiny studio while paying my student debts worked out well for me.