How to Ride the Mushroom Coffee Boom

As a supplements manufacturer, I’ve seen countless trends come and go—but mushroom coffee (and mushrooms in general) are here to stay. Smart manufacturers and CPG brands are paying close attention to this exponentially expanding market as it rides the $1.8 trillion and growing worldwide wellness wave.

The U.S. mushroom market was valued at $2.97 billion in 2023, and researchers forecast the mushroom coffee market will grow by 5 percent annually. So how did drinking hot water poured over dried fungus become so popular? ​​At Mycroboost, where my team and I have been formulating best-in-class mushroom products and supplements for years, we set out to study this weird phenomenon — with the aim of creating a signature coffee of our own. 

The Mushroom Coffee Craze: How It Started, How It’s Going

While traditional Chinese medicine practitioners have used mushrooms to create tinctures and brews for millennia, Finnish people began using chaga mushrooms as a coffee substitute when coffee beans were scarce during World War II. 

Chaga was already a staple of Nordic folk medicine, and modern science has proven it has a host of health benefits. I’d argue that mushroom coffee took off in a way that other wartime coffee shortage adaptations (okra seed, chicory and acorn coffee) never did because of mushrooms’ tangible impact on physiological and neurological health. 

Coffee is by far America’s most widely and frequently consumed psychoactive substance (yes, like cannabis, psilocybin and other Schedule 1 substances, caffeine is a psychoactive drug). Two-thirds of us consume it daily. So what did coffee do wrong that millions of us decided we needed a substitute?

First, Americans are depressed and stressed out, and coffee can increase anxiety and disrupt sleeping patterns. Coffee can also wreak havoc with your digestive system, whereas many mushrooms actually support gut health. Post-pandemic, people want natural foods that can support their immune systems, clear their heads and boost their energy without caffeine jitters. Everybody wants a better brain — and certain mushrooms benefit brain health so much that they’re being adopted by patients with Alzheimer’s, dementia and traumatic brain injury (TBI). 

Mushroom coffee gives consumers the energy boost they want from their morning beverage, plus all the long-term health benefits of mushrooms: adaptogens, polysaccharides, beta-glucans, vitamins, minerals, antioxidants and more. 

How the Pandemic Fueled Mushroom Mania and New Product Development

During the Covid-19 crisis, consumer spending on supplements spiked, and my supplement manufacturing business was bombarded with proposals for white-label nootropic and immune support products. As I researched potential new formulations, lion’s mane mushrooms seemed to be the ideal multitasking ingredient, addressing the immune system, brain health, energy levels, and more.

But the more I researched the lion’s mane products on the market, the more “fairy dusting” I saw. (Fairy dusting — when brands jump on a trendy ingredient but only add a negligible amount of it to the end product — is an unfortunate practice I warned consumers about in a previous article.)

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I’m a firm believer that the way to set yourself apart in the often-sketchy supplements industry is to use actual therapeutic doses in your products that genuinely impact people’s health. Clearly, there was an open lane for a good lion’s mane product that provided a truly effective dose of mushrooms.

In addition to gummies and liquid soft gels, coffee with lion’s mane looked like a sure winner. But before we set out to make our own, my team and I ordered 12 different brands and tried them all. 

Mushroom Coffee Formulation: The Good, The Bad and the Tasty

Taste is the biggest hurdle that mushroom coffee has had to face. Some of the formulations were best-selling brands, but we disliked every single one. None of us could imagine replacing our beloved coffee with something that tasted like dirt.

One issue is that key varieties that any decent mushroom coffee should contain (reishi, chaga, cordyceps) are famously bitter. To make mushroom coffee taste better (and make it cheaper to manufacture), some brands just use trace amounts of mushrooms and tons of grain filler — but then you’re not getting the benefits (fact: you need 2500 mg of mushrooms per cup, or you’re getting ripped off). My team and I were obsessed with the question: can you make a mushroom coffee that contains a therapeutic dose of mushrooms and tastes great? 

Taste is, of course, subjective — it’s really up to consumers to judge, but I think we succeeded beyond our wildest expectations. Here’s how we did it:

1. No mycelium, grains or filler. Imagine drinking orange juice that contains the dirt the orange tree grew in — no thanks. I honestly think that including mycelium (which is analogous to the roots of the mushroom) and substrate (which is like the dirt the mushroom grows in) in their formulations is why some mushroom coffees taste terrible. Call me a purist, but if you’re going to drink mushroom coffee, it should be made with mushrooms. Check your labels for the phrase “fruiting bodies only.”

2. Add some actual coffee! We are certainly not the only brand to do this, but I feel like if you have some coffee beans in your mushroom coffee mix, the leap is so much easier to make. This method still reduces caffeine, but allows consumers to “step down” more gradually from daily coffee consumption.

3. Cacao and salt. Turns out cacao has a host of health benefits. It’s rich in minerals, promotes heart health and contains the feel-good chemical theobromine. Cacao ceremonies that originated in the Amazon basin are making a comeback, and the more we learned about cacao as a medicinal ingredient, the more we realized that making a mushroom mocha was the way to go. We added salt, which not only concentrates flavor and intensifies sweetness, but inhibits our ability to taste bitterness, which counteracts the umami flavor of the mushrooms.

Final Thoughts

To each their own — but I think the mushroom coffee brands that use real mushrooms to formulate beverages that people actually like drinking are the ones that will go the distance. You should look forward to a pleasant morning coffee ritual, instead of forcing yourself to choke down a bitter-tasting concoction “for health.”