ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra Cafetera
Sustainable Income through
Sustainable Agriculture
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Logistics LatinAmerica (LLA)
• Logistics LatinAmerica (LLA) is a
venture capital firm, investment
broker and incubator for Latin
America businesses
• LLA integrates high-value logistics
capabilities; air, marine, and ground
transportation; and technology
solutions
• Holding company for operating
divisions focused on importation &
exportation of agricultural products
www.LogisticsLatinAmerica.com
LLA´s headquarters are in
Medellín, Colombia
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Chief Executive Officer James Cummiskey
Chief Operations Officer Roger Roland
Vice President
Coffee Eduardo Zapata
Vice President Cima Coffee
Michael Forman
Director of Operations Alejandro Duque
Vice President Investments David Sewell
Director of Internet Sales Cathy O´Sullivan
Logistics LatinAmerica Leadership
= Principal Owner
Vice President Marketing/Comm
Carl Nolasco
Director Unmanned Aircraft Systems
Ralph Rodriguez
Director of Coffee Science Juan Vélez
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Logistics LatinAmerica Leadership
• James Cummiskey – Chief Executive Officer (CEO), Logistics
LatinAmerica
– MBA Technology / Masters Computer Science
– Boeing Executive leading a $100M business serving the US military and intelligence community
– US Marine Corps Veteran w/ significant infantry, communications, and DoD acquisition expertise
– Executive at multiple start-up businesses funded by Microsoft, Qualcomm & Sprint
– Senior Vice President / CEO of Aerospace/Defense manufacturing business
– FAA Airline Transport Pilot (ATP) and Multi-Engine Instrument Flight Instructor
– SCAA Certificated Q-Grader
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• Eduardo Zapata – Vice President of Coffee, Logistics
LatinAmerica
– B.S. Business Administration, Remington
– B.S. Management, EAFIT & Quirama
– 55 years experience in coffee farming
– Owner and manager of multiple coffee farms
– President, Association of Farm-Hotels of
Southwestern Antióquia
– Vice Chairman of the Supervisory Board of
the Coffee Growers Cooperative of Antióquia
– President, Municipal Committee of Coffee
Amagá
Logistics LatinAmerica Leadership
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What is ¨Specialty Coffee?¨
• Describe coffee beans of the best
flavor with high cup quality and
little to no defects
• Specialty coffee is the term
commonly used to refer to
"gourmet," "premium" or
¨certified¨ coffee
• However, according to the
Specialty Coffee Association of
America (SCAA), only coffee
which scores 80 points or above
on a 100-point scale is graded as
"specialty."
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Third Wave of Coffee Increasing
Demand for Specialty Coffee
Specialty coffee sales account for 16% of the market and are increasing 20 percent per year
Source: Specialty Coffee Retailer, http://www.specialty-coffee.com/
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee Producers in Latin America
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra
Cafetera
(Producers)
Coffee
LatinAmerica
(Logistics)
Responsibilities: Property Buy/Sell Property Management Coffee Improvements Coffee Processing Producer Micro-financing
Coffee Quality
Responsibilities: Green Coffee Sales Coffee Science Virtual DirecTradeTM Coffee Export/Import Coffee Warehousing
Coffee Quality
Responsibilities: Roasted Retail Sales Roasting Cafés Roasted Wholesale Sales Coffee Store Management Coffee Roasting Facilities
Coffee Quality
Opportunities Across the Entire Value Chain “From Seed to Cup”
Cima
Coffee
(Consumers)
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra Cafetera (TC)
Tierra Cafetera operates Latin American coffee
farms using sustainable farming practices to
optimize the yield and quality of specialty coffee
while improving the lives of coffee workers.
www.TierraCafetera.com
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee LatinAmerica (CLA)
Coffee LatinAmerica provides the highest quality
green specialty coffee from Latin America to
international customers using both Virtual
DirecTrade™ and direct sales channels.
www.CoffeeLatinAmerica.com
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Cima Coffee
Cima Coffee provides the highest quality roasted
specialty coffee with wholesale sales to super-
markets, restaurants & distributors and retail sales
via a chain of roasting cafés and the Internet.
www.CimaCoffee.com
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Fundamental Coffee Value Chain
Quality Quality Quality Quality Quality Quality Quality Quality Quality
Grow and Harvest
Depulp, Wash & Dry
Hull, Sort and Sack
Export and Warehouse
Roast and Package
Sell and Distribute
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee: An Industry in Crisis
• There are ~25 million coffee workers
in over 50 countries around the world
– 11 million hectares of the world's
farmland grows coffee
– 59% of the world´s coffee
production is from Latin America
• World production for coffee is at an all-
time high, but conditions for farmers
are at an all-time low
• Colombia´s coffee-growing regions
are threatened with mining,
deforestation and climate change
Source: International Coffee Organization; http://www.ico.org/
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee: An Industry in Crisis
• Coffee farm workers are paid less
than minimum wage with virtually no
benefits
• Coffee farm workers typically start
working in the field at 10-11 years old
and work well into their 80s
• Coffee producers and workers are kept
in a cycle of poverty by industry
dynamics designed to shift profits to
the intermediaries
• NET RESULT: There is an ongoing
global coffee crisis causing extreme
suffering among coffee farmers and
workers
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
A Conversation with a Colombian
Coffee Farmer
www.youtube.com/user/TierraCafetera
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee Industry in Crisis =
Opportunity! Problems
• Coffee is being mixed from different farms which lowers the quality
• All the intermediaries between the producer and consumer take most of the profits
• Coffee producers aren´t getting their coffee evaluated to improve quality
Solutions
• Pay premiums to incentivize single-origin segmentation of specialty coffee
• Coffee producers need to directly connect with both professional & home roasters
• Producers need incentives and training to evaluate their coffees
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
How our Business Model Helps
• TC pays liveable wages, medical and
retirement benefits and stock options to
TC farmers to ensure their economic
sustainability
• TC uses agronomically sustainable
farming techniques to improve the
quality & variety of specialty micro-lots
• CLA increases the quality and variety of
coffee via coffee science, technology
& optimized micro-logistics
• CLA pays significant price incentives
to grow specialty micro-lots for 3+ million
Latin America coffee farms
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
How our Business Model Helps
• Cima drives predictable
demand for specialty coffee
beans to assure sustainable
incomes for both farmers &
property owners
• LLA helps improve the lives of
coffee workers with training,
certification and financial support
• LLA contributes 5% of LLA´s net
profits to impoverished coffee
farm workers through various
programs
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Tierra Cafetera Coffee Farms
Real Estate Agri-Investment
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra
Cafetera
(Producers)
Coffee
LatinAmerica
(Logistics)
Responsibilities: Property Buy/Sell Property Management Coffee Improvements Coffee Processing Producer Micro-financing
Coffee Quality
Responsibilities: Green Coffee Sales Coffee Science Virtual DirecTradeTM Coffee Export/Import Coffee Warehousing
Coffee Quality
Responsibilities: Roasted Retail Sales Roasting Cafés Roasted Wholesale Sales Coffee Store Management Coffee Roasting Facilities
Coffee Quality
Opportunities Across the Entire Value Chain “From Seed to Cup”
Cima
Coffee
(Consumers)
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
0.5 Acres
0.5 Acres
0.5 Acres
0.5 Acres
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Medellín
Geographic Diversity of Farms = Lower Risk of Cash Flows
Colombia
Antioquia
Department of Antioquia
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Sustainable Income through
Sustainable Agriculture
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Sustainable Agriculture for Coffee
• Healthy soils
produce healthy
coffee
• Transition from
mono-culture to bio-
diversity
• Shade-grown coffee
improves quality!
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Soil Science for Optimizing Coffee
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Effects of Shade Trees on Coffee
• Reducing extremes in air and soil temperatures
• Breaking the force of wind and heavy rainfall
• Controlling erosion on steep slopes
• Suppressing weeds
• Producing annually 5–15 tons organic matter per ha
• Recycling of nutrients and reducing nutrient leaching
• Providing additional revenue from the shade trees (timber, firewood and fruits)
• Potentially reducing incidence of diseases and pests
• Improving cup quality
Source: Beer, 1987; Beer et al., 1998; Guyot et al., 1996; Muschler, 2001
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Integrating Bio-Diversity in Tierra
Cafetera Coffee Farms
• Shade trees: e.g.
plantains and guamo
• Cover crops: especially
nitogren-fixing legumes
such as beans
• Livestock and other
animals
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Sustainable Organic Farming
• We use organic
farming techniques
wherever possible: • Composting
• Green manure
• Natural pest control
• Crop rotation
• Organic Certification
Sponsorship Program
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A Typical Farm in Our Network:
La Virgen
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Tierra Cafetera Web Site
www.TierraCafetera.com/
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Using Low-Cost Unmanned Aircraft for
Connecting Property Owners to their Farms
www.youtube.com/user/TierraCafetera
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
2013 Coffee Farm
Acquisition Schedule
Qtr/Year of
Acquisition Farm Name City Name Total Acres
Acres
Available for
Investment
Q4 2012 La Virgen Concordia 101 75
Q1 2013 Aborleda Jardin 40 35
Q1 2013 El Gólgota Apia 25 22
Q2 2013 Las Brisas Apia 23 18
Q2 2013 El Silencio Apia 113 100
Q3 2013 Alejandria Jardin 64 60
Q4 2013 La Gabriela Amagá 102 51
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Tierra Cafetera
20 Year Financial Forecast
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Year 11 Year 12 Year 13 Year 14 Year 15 Year 16 Year 17 Year 18 Year 19 Year 20
Average Yield of Exportable Green Coffee (lbs per ha) 4000 4400 4840 5324 5856 6149 6457 6780 7118 7403 7699 8007 8007 8007 8007 8007 8007 8007 8007 8007 8007
Average Price with Specialty Premium ($USD per lb) 1,80$ 2,25$ 2,59$ 2,98$ 3,57$ 4,11$ 4,52$ 4,97$ 5,34$ 5,74$ 6,03$ 6,33$ 6,49$ 6,65$ 6,82$ 6,99$ 6,99$ 6,99$ 6,99$ 6,99$ 6,99$
Average Operating Income ($USD per ha) 7.200$ 9.900$ 12.524$ 15.842$ 20.912$ 25.251$ 29.165$ 33.685$ 38.022$ 42.509$ 46.420$ 50.690$ 51.958$ 53.257$ 54.588$ 55.953$ 55.953$ 55.953$ 55.953$ 55.953$ 55.953$
Average Operating Expense ($USD per ha) 8.335$ 10.419$ 10.628$ 10.840$ 11.057$ 11.278$ 11.504$ 11.734$ 11.969$ 12.208$ 12.452$ 12.701$ 12.955$ 13.214$ 13.479$ 13.748$ 14.023$ 14.304$ 14.590$ 14.881$ 15.179$
Gross Income before Taxes -1.135 $ -519 $ 1.896$ 5.002$ 9.855$ 13.973$ 17.661$ 21.952$ 26.054$ 30.301$ 33.968$ 37.989$ 39.003$ 40.042$ 41.110$ 42.205$ 41.930$ 41.649$ 41.363$ 41.071$ 40.774$
Average Income Tax Expense -$ -$ 379$ 1.000$ 1.971$ 2.795$ 3.532$ 4.390$ 5.211$ 6.060$ 6.794$ 7.598$ 7.801$ 8.008$ 8.222$ 8.441$ 8.386$ 8.330$ 8.273$ 8.214$ 8.155$
Investor Return ($USD) -50.000 $ -$ 1.213$ 3.201$ 6.307$ 8.943$ 11.303$ 14.049$ 16.674$ 19.393$ 21.739$ 24.313$ 24.962$ 25.627$ 26.310$ 27.011$ 26.835$ 26.656$ 26.472$ 26.286$ 26.095$
Annual ROI (% per ha) 0% 0% 2% 6% 13% 18% 23% 28% 33% 39% 43% 49% 50% 51% 53% 54% 54% 53% 53% 53% 52%
Increased Value of Property
Total 20 Year IRR % 19%
Average Income Tax Expense 20%
Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 … Year 16 Year 17 Year 18 Year 19 Year 20
Average Yield of Exportable Green Coffee (lbs per ha) 4000 4400 4840 5324 5856 6149 8007 8007 8007 8007 8007
Average Price with Specialty Premium ($USD per lb) 1,80$ 2,25$ 2,59$ 2,98$ 3,57$ 4,11$ 6,99$ 6,99$ 6,99$ 6,99$ 6,99$
Average Operating Income ($USD per ha) 7.200$ 9.900$ 12.524$ 15.842$ 20.912$ 25.251$ 55.953$ 55.953$ 55.953$ 55.953$ 55.953$
Average Operating Expense ($USD per ha) 8.335$ 10.419$ 10.628$ 10.840$ 11.057$ 11.278$ … 14.023$ 14.304$ 14.590$ 14.881$ 15.179$
Gross Income before Taxes -1.135 $ -519 $ 1.896$ 5.002$ 9.855$ 13.973$ 41.930$ 41.649$ 41.363$ 41.071$ 40.774$
Average Income Tax Expense -$ -$ 379$ 1.000$ 1.971$ 2.795$ 8.386$ 8.330$ 8.273$ 8.214$ 8.155$
Investor Return ($USD) -50.000 $ -$ 1.213$ 3.201$ 6.307$ 8.943$ 26.835$ 26.656$ 26.472$ 26.286$ 26.095$
Annual ROI (% per ha) 0% 0% 2% 6% 13% 18% … 54% 53% 53% 53% 52%
Increased Value of Property
Total 20 Year IRR % 19%
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra Cafetera Opportunity
Summary • Titled ownership of an operating coffee farm
• Turnkey operations—professionally managed for you
• Average annual return of 19%
• Cash flow begins in 6 months--paid quarterly
• Profits: 80% for owners--20% for farmers
• Parcel size: 0.5 acres min--starting at $10K USD
• Multiple contiguous parcels available
• Vacation on your own land
• Drink coffee from your farm at home
• Improve the lives of coffee workers together
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee LatinAmerica The Channel to Market for TC Farms
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra
Cafetera
(Producers)
Coffee
LatinAmerica
(Logistics)
Responsibilities: Property Buy/Sell Property Management Coffee Improvements Coffee Processing Producer Micro-financing
Coffee Quality
Responsibilities: Green Coffee Sales Coffee Science Virtual DirecTradeTM Coffee Export/Import Coffee Warehousing
Coffee Quality
Responsibilities: Roasted Retail Sales Roasting Cafés Roasted Wholesale Sales Coffee Store Management Coffee Roasting Facilities
Coffee Quality
Opportunities Across the Entire Value Chain “From Seed to Cup”
Cima
Coffee
(Consumers)
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
What is the Key Challenge for the
Professional Roaster?
Latin America produces
~9,000,000 lots of
coffee each year
Of these, about
10% or ~900,000 are
Specialty Lots
Of these, only ~900 are
available for purchase each year on the spot market
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Home Roasters
CLA Coffee Sourcing
Purchase
Parchment Ship
Mill and
Package Ship Package & Distribute Bag Customer
Latin America International Destinations
…
…
80+ Farm Z
Professional
Roasters /
Specialty
Supermarkets
1 lbs
1-20 lb
Pkgs
80+ Farm A
…
… 1-325
Sacks
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Coffee LatinAmerica Web Site
www.CoffeeLatinAmerica.com/
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Professional Roaster Customer
Offering List
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
USA Fulfillment Center / Cupping
Laboratory, Anaheim, CA
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Ebay Auctions
Internet Web Store
Home Roaster Strategy
USA Warehouse /Fulfillment
Center
http://tinyurl.com/ebaycla
http://coffeelatinamerica.com/
90+, Geishas, Auction Winners, etc.
Drum & Air Roasters, Books, Brewers, Grinders, etc.
High-End Coffees
High-Value
Coffees
Home Roasting
Equip
80+ Low-Cost Coffees, etc.
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
CLA Customer Feedback • Thanks again for a great service from start to finish, and i will definitely buy from you
again and recommend to others. – David D.
• Excellent price, fast delivery, fantastic coffee. My new go-to source! Thanks. - Paula D.
• Cup of Excellence!!! Great coffee, fast shipping. Highly recommended. - Jun C.
• Thank you very much exactly as you said it would be A++++++++++++++++++++++++ -
Edward M.
• Smooth Doesn't Begin To Describe It...Really Fast Shipping...Thank You So Much -
Tamera P.
• GEISHA, GEISHA, GEISHA, WOW, Great coffee fast shipping, exceptional cup. -
Tammy J.
• This is great coffee—thanks so much. Fast service. A+++ - Arnold R.
• Can't get enough of the Santa Teresa Geisha it is incredible, has to be one of the best
coffee's going around right now. – Nolan H.
• This is the first time I have tasted REAL floral notes in coffee. It changes my perspective
on how coffee should taste. – Chong C.
• I just wanna tell you how absolutely impressed I am with your coffee. You have a
customer for life.– John B.
Source: www.tinyurl.com/feedbackcla
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Tierra Cafetera Opportunity
Summary • Titled ownership of an operating coffee farm
• Turnkey operations—professionally managed for you
• Average annual return of 19%
• Cash flow begins in 6 months--paid quarterly
• Profits: 80% for owners--20% for farmers
• Parcel size: 0.5 acres min--starting at $10K USD
• Multiple contiguous parcels available
• Vacation on your own land
• Drink coffee from your farm at home
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Coffee Farmer Ownership Packages
Package Name Number of Parcels
Number of Acres
Retail Value ($USD)
Discounted Package Price ($USD)
The ¨Gentleman/Woman¨ Farmer 36 18 $360,000 $288,000
The ¨Executive¨ Farmer 18 9 $180,000 $147,500
The ¨Natural Born¨ Farmer 6 3 $60,000 $50,000
Individual Parcels are Available at $10,000 Each Minimum is 1 Parcel
Multiple Parcels Available on a Contiguous Basis
Farmer Ownership Packages and Parcels Available on a First-Come, First-Served Basis!
ETHICAL BEHAVIOR • OUTSTANDING EXECUTION © Logistics LatinAmerica, S.A.S.
Questions?
• James Cummiskey – Medellín, Colombia
– Office: (310) 855-3755 (U.S.A.)
– Mobile: +57-313-793-5672 (Colombia)
– www.LogisticsLatinAmerica.com