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Alejandro Velez

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Back to the Roots co-founder Alejandro Velez planned on becoming an investment banker. Now he grows mushrooms. Velez, who was born in Medellin, Colombia and grew up in Paw Paw, MI, stumbled upon entrepreneurship while a senior at University of California, Berkeley. After learning in a course that coffee grounds and other agricultural waste streams could be used to cultivate mushrooms, Velez approached the professor with piqued curiosity. Another student, Nikhil Arora, had done the same, and the professor put the two in touch. They decided to experiment, collecting grounds in ten paint buckets and setting up a mini-mushroom farm in the back of Velez’s fraternity house. Nine of the buckets produced nothing, but one bloomed into a bumper crop of fungi. The young entrepreneurs brought their mushrooms to Chez Panisse. With the famed restaurant’s chef’s approval and a $5,000 grant from Berkeley bolstering their confidence, Velez and Arora deferred their post-graduation plans to give fungi farming a try.

After earning his BS in Business Administration and Management in 2009, Velez continued collaborating with Arora on expanding their mushroom enterprise. Soon they were producing 500 pounds of mushrooms a week, selling their crops in Whole Foods and farmers markets. Based on inquiries from their customers about growing the mushrooms themselves, Velez and Arora decided to pivot the company. They developed a mushroom growing kit, packing pearl oyster mushrooms spore in recycled coffee grounds from Peets Coffee and Tea. By July 2015, their Grow-at-Home Mushroom Kit was on the shelf at 14,000 retailers, including Whole Foods, Target, and Costco.

As the company grew, the co-founders expanded their offerings. Their next offering was a similar grow-your-own-concept, a fresh herb garden working in symbiosis with a self-cleaning fish tank. They funded the product, The Aquaponics Garden, through Kickstarter, raising almost $250,000 in their 2013 crowdfunding campaign. They’ve continued to expand their grow-your-own offerings, with products including herb-growing kits and a self-watering planter. Always looking towards reconnecting people with real, simple food, in 2015 they released a “ready-to-eat” line. Their organic products include a three-ingredient wheat flakes cereal and “breakfast toppers” consisting of nuts and dried fruit. In 2015 they bolstered their continued growth with a $2 million funding round, their first major outside investment. The round was led by Fund Good Jobs, with others including sustainable food and technology notables such as Clif Bar CEO Kevin Cleary, Stonyfield founder Gary Hirshberg, Tom’s Shoes founder Blake Mycoskie, Urban Sitter CEO Jessica Steel, former Yahoo president Brian Steel, Annie’s Inc President John Foraker, and author Michael Pollan.

Velez’s co-cultivation of a flourishing home agriculture company has not escaped notice, earning wide recognition. Accolades include ranking among Forbes’s 30 Under 30 in Food and Wine, BusinessWeek’s Top 25 Entrepreneurs under 25, BusinessWeek’s Top 25 Social Entrepreneurs in America, and PODER Magazine’s 20 Influential Hispanics Under 40 for 2010. He was also a 2010 Social Venture Network Social Innovation winner and a 2010 Hitachi Young Entrepreneur winner. Velez and Arora were acclaimed TEDtalk speakers, and were among a small group of entrepreneurs invited to speak with President Obama about the needs of small business owners.

In addition to pictures from publications celebrating his entrepreneurial success, some may recognize Velez’s face from television. He competed in the summer 2012 season of The Bachelorette. The proud Hodgkin’s Lymphoma cancer survivor lives in Oakland, where he continues to tend the growth of Back to the Roots.

(Sources used to write this profile include a July 2012 Inc. profile, a June 2012 MLive article, an August 2013 ZDNet interview, a June 2015 San Francisco Chronicle article, a June 2011 IdeaMensch profile, a February 2013 Innov8Social profile, the Back to the Roots website and the entrepreneur’s LinkedIn profile)�

Companies and Investments

Back to the Roots (co-founder)

Lessons Learned

There’s been a huge shift. Big corporations are struggling with their customer demographics getting older and older. We’ve heard it from our buyers -- Home Depot and places like that. Their challenge is to tap into that millennial generation that cares about the ‘why’ and the ‘who’ of products –- why it’s created and who is behind it, rather than just what it is.

We’ve heard again and again this anxiety from the big players about their demographics who used to not care about this. In the next five or 10 years, as the millennial generation starts having more purchasing power, it will be interesting to see how these older brands will either re-brand themselves or acquire other companies to stay relevant and fresh. (Alejandro Velez on understanding the evolving mindsets of your customers, in an interview on ZDnet.com)

The greatest ideas come when you least expect it. Nikhil and I were in a business ethics class when our professor, Alan Ross, had mentioned that gourmet mushrooms could be grown on recycled coffee grounds. Neither of us knew the other, but we both separately contacted our professor to get more information. He hooked us up and from there, we started talking about how we could make this work. After doing some research, we found out less then 1% of the coffee beans actually ends up in your morning cup of joe, the rest is tossed. We thought about how addicted America is to coffee, and how we could help divert this waste into something usable. It just so happens that the coffee grounds when condensed is a perfect medium for oyster mushrooms to grow on, acting similar to something like wood. (Alejandro Velez on finding inspiration in unexpected places, in an interview on the Lemonade and Origami blog)

Be transparent. If people know what you’re doing, they know they’ll be able to trust you. We never hid our warehouse operations or our struggles, and so people knew that when we told them something, it was true. Also – talk to everybody! Live and breathe what you’re doing and it will start to attract attention. (Alejandro Velez, with Nikhil Arora, on the importance of humanity and transparency in business, in an interview with Innov8Social)

Inspiring Quotes

Alejandro Velez's Quotes

Listen to your customers – they’ll tell you what people are looking for, and then you can create it for them.

Alejandro Velez

Influential Books