How do you grow a DTC brand without a big brand awareness budget? Terra Kaffe founder Sahand Dilmaghani pre-sold 10,000 espresso machines from a single page with no reviews, and word of mouth has been the top reason customers buy every month for five years.

On the DTC Podcast, Sahand tells Eric Dyck how he left investment banking to bootstrap a super automatic espresso machine, what he cut to get it shipped with $2.5 million already spent, and why Terra Kaffe now puts its money into community and performance marketing instead of brand awareness. Terra Kaffe has 70,000 machines in homes today.

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WHAT YOU WILL SOLVE

You sell a high-ticket product and cannot seed it to a thousand creators a month. Sahand built word of mouth by calling customers himself, and it now drives well over a third of Terra Kaffe’s orders.

Your brand awareness budget is too small to register. Why $15K to $20K a month will never make you a household name, and when to hold that money for one campaign big enough to count.

Your best video flopped on Meta. A $30K shoot that never converted on Instagram or Facebook became one of Terra Kaffe’s strongest performers on CTV.

Your investors want proof of demand before the product is finished. One pre-order page, a teaser campaign, an email to the subscriber list and a booth at a New York coffee festival produced 10,000 orders.

Your product is over budget and behind schedule. The features Terra Kaffe cut in a do-or-die meeting to ship in six months, and which ones came back later as a fast follow.

Your outside partner has spent double to go half the distance. How Sahand replaced his engineering firm mid-build while it still held most of the product knowledge.

You cannot afford tooling or a production deposit. The trade he made with his manufacturer on the first machine’s design rights, and what it cost him later.

ABOUT SAHAND

Sahand Dilmaghani is the founder and CEO of Terra Kaffe, the Brooklyn-based maker of super automatic espresso machines, including the TK-02 and the Demi. Before Terra Kaffe he worked in investment banking and at an electric vehicle startup. https://www.terrakaffe.com

Instagram: https://www.instagram.com/terrakaffe

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00:49 From Wall Street banker to “barista”

02:25 Carrying a 30 pound espresso machine on the subway

04:40 The only espresso brand anyone could name

05:22 The Larry David campaign idea

06:13 Building complex hardware during COVID

08:52 $2.5 million in, with no guarantee it ships

09:09 Funding one milestone at a time

10:42 The meeting where the features got cut

13:36 Replacing the engineering firm mid-build

16:33 Giving the manufacturer the V1 design rights

20:44 Answering the dropship accusations

21:32 The investor test: does anyone want this

23:22 10,000 pre-orders from one page

25:11 The Terra Kaffe manifesto

26:16 What a super automatic machine does

29:39 Why people bought before they could try it

32:33 70,000 machines in homes

33:25 Word of mouth, every month for five years

36:28 Brand spend versus performance marketing

38:23 The three problems every operator hits

40:39 Why a small brand awareness budget is a trap

41:15 Coming for Nespresso

42:37 CTV and the $30K shoot that flopped on Meta

46:34 Survival by a thousand band-aids

47:34 Raising $2.6 million in 13 days

48:03 You are going to get punched in the face