Photo of Siqueira and Armelin
Siqueira and Armelin at their coffee farm Fazenda Terra Alta, north of Sao Paulo

Coffee Futures

Seven years ago, a Booth alumni couple left the corporate world to wake up and smell the coffee.

Back when he worked in finance, Paulo Siqueira, ’04, used to wake up in the middle of the night worried that some market event would spoil his investments. But in 2010, Siqueira and his wife, Juliana Armelin, ’04, left corporate jobs to take the plunge into coffee, starting a farm some 400 miles north of their hometown of São Paulo. “Now, we wake up at night afraid there is going to be a frost in the morning,” Siqueira said.

Despite the occasional weather-related insomnia, the couple has thrived in the coffee business. Two years ago, their farm, Fazenda Terra Alta, won the highest prize for espresso coffee in Brazil. Last year, it won again. Of course, that doesn’t mean the couple’s transition from business to beans has been easy. In growing their farm, they’ve faced a steep learning curve in a business just as volatile as stocks and hedge funds. “If we had known all the risks beforehand,” said Siqueira, “I don’t know if we would have had the guts to start.”

Armelin and Siqueira met in their last year of college at the University of São Paulo, where they both studied electrical engineering. They entered corporate careers—Armelin as a consultant for McKinsey & Company and Siqueira in finance with Credit Suisse—before seeking MBAs at Booth. They traveled north to Chicago with two Great Danes in tow, laying up sweaters for their first snow, and learning lessons that served them well in excelling in their corporate jobs and eventually in creating their own business from scratch. “We still apply [what we learned in] Advanced Microeconomic Analysis with professor Kevin M. Murphy every day,” Siqueira said.

Despite enjoying their post-MBA careers, the two felt their lives were out of balance. “I loved the job, but we didn’t have any time to be together, to enjoy our dogs,” Armelin said. Siqueira left Credit Suisse for a boutique hedge fund, but still felt like he spent most of his energy trying to convince bosses, clients, and investors to try new things. He wanted to be doing new things. “We just needed to convince each other,” he said.

Photo of coffee fields “We asked a lot of questions and tried to find people who were knowledgeable about coffee but also open-minded,” Siqueira said. “We wanted to learn how things were done, but not necessarily do things that way.”

When Armelin’s father bought a farm in São Paulo, the two learned about planting. At the same time, Siqueira was researching investments in coffee for his firm. The more they looked at the numbers, the more they realized they could make a go of it as coffee farmers, and maybe achieve that elusive work-life balance. They quit their jobs in 2010, and with help from Armelin’s father, who cosigned some of their first loans, the couple bought a 518-acre plot. In day-to-day operations, Armelin concentrates on finances and sales, while Siqueira spends time out in the field, focusing on growing techniques and production. 

Most coffee farms focus on quantity, while possibly producing a few microlots of high-quality crop. At Fazenda Terra Alta, the couple committed themselves to quality across the board. They installed drip irrigation that could deliver a constant supply of fertilizer—leading to production almost twice the national average—rather than the normal practice of applying it in bulk a few times a year.

Their greatest innovation so far has been employing raised beds to dry all of the coffee beans—the massive wooden tables ensure more even drying than the concrete patios normally used in Brazil. Recently, they’ve been working to increase their profit margins by going directly to small roasters, which sell to niche markets of aficionados. 

The business has posed some unexpected challenges. “We did underestimate the risks involved—but we also found more opportunities and rewards than we expected,” Siqueira said. Unlike in finance, it’s not possible to hedge against unforeseen changes, such as the weather, including the dreaded early frost that happened last year. “We did a lot of computations, finally realizing we would be OK,” he added. 

Even in a bad year, the time spent together is its own reward. “We have more time for family, so if a year isn’t as good as we planned, we don’t have the same feeling of loss,” said Siqueira. The couple has no plans to return to the corporate world. “Here we can look over what we built on the farm,” Armelin said. “And it’s kind of amazing.”

—By Michael Blanding