John Sylvan and Peter Dragone worked together to figure out a better solution for making coffee. In 1992, they founded Keurig, which means “excellence” in Danish. Sylvan was, after all, the target consumer of the product he was trying to make. In 1995, he went to the hospital after feeling woozy and having heart palpitations. Once a heart attack and brain injury were ruled out, the doctor pursued other avenues of questioning. He finally got to the root of the problem when he asked Sylvan how much coffee he drank on a daily basis. Sylvan’s answer? 30 to 40 cups each day. He was diagnosed with caffeine poisoning and told to reduce his coffee intake.
Despite a rough start for the company, coffee became more than just John Sylvan’s beverage of choice. It became his life, his livelihood, and his sole focus. It all started in the mid-1980s, when John Sylvan was working in marketing. He felt that the coffee his colleagues drank, along with the system by which they paid, was of poor quality. Coffee sat in the pot for hours, and it became bitter tasting. He knew there had to be a better solution. In the early 1990s, he began trying out different single-serving coffee pod ideas. Once he began prototyping various machines, he brought in Peter Dragone, his former roommate from Colby College, as a 50% partner.
The two men had trouble finding investors and building a machine that was reliable and easy to demonstrate. Once they finally got an investor in 1994, it was a snowball effect. They received over one million dollars in funding, and they were finally able to begin selling commercial brewers. The company took two years to develop an affordable and reliable home model, but it hit store shelves in the mid-2000s. Now, Keurig is worth billions of dollars. Over 13% of all American businesses have Keurig commercial models in the workplace, and at least one out of every four coffee makers sold in the US is Keurig brand. John Sylvan, however, left the company on poor terms, gave up his equity, and received only $50,000. While he wishes he would have considered a royalty deal for the K-cups, or the machines themselves, he says that he’s just grateful to have been a part of creating an iconic brand.