He was the son of Casparus van Houten (1770-1858) and Arnoldina Koster. His father opened a chocolate factory in Amsterdam in 1815, with a mill turned by laborers. At that time, cocoa beans were ground into a fine mass, which could then be mixed with milk to create a chocolate drink or, with addition of sugar, cinnamon and vanilla, made into cookies. However, the high fat content made the chocolate very hard to digest.
In 1828 Casparus van Houten Sr. (and not his son, who is usually credited) patented an inexpensive method for pressing the fat from roasted cacao beans. The center of the bean, known as the "nib," contains an average of 54 percent cocoa butter, which is a natural fat. Van Houten's machine - a hydraulic press - reduced the cocoa butter content by nearly half. This created a "cake" that could be pulverized into cocoa powder, which was to become the basis of all chocolate products.
The introduction of cocoa powder not only made creating chocolate drinks much easier, but also made it possible to combine chocolate with sugar and then remix it with cocoa butter to create a solid, already closely resembling today's eating chocolate.
In 1838 the patent expired, enabling others to produce cocoa powder and build on Van Houten's success, experimenting to make new chocolate products. In 1847 English chocolate maker J. S. Fry & Sons produced arguably the first chocolate bar. Later developments were in Switzerland, where Daniel Peter introduced milk chocolate in 1875 and Rodolphe Lindt made chocolate more blendable by the process of conching in 1879.
Van Houten introduced a further improvement by treating the powder with alkaline salts (potassium or sodium carbonates) so that the powder would mix more easily with water. Today, this process is known as "Dutching". The final product, Dutch chocolate, has a dark color and a mild taste.
In 1835 Coenraad van Houten married Hermina van Houten (unrelated) from Groningen. In 1850 he moved his production from a windmill in Leiden to a steam factory in Weesp. By that time he was exporting chocolate to England, France, and Germany. In 1866 John Cadbury traveled to Weesp to buy a Van Houten press, but didn't use it in his manufacturing until 1875.
Coenraad’s son Casparus (c.1844-1901), employed since 1865, had a gift for marketing and contributed greatly to the growth of the company. Advertisements for Van Houten could be found on trams throughout Europe and the United States. As early as 1899 Van Houten produced a commercial film that depicted a sleepy clerk who recovers miraculously after eating some chocolate. The factory was a boost for the town of Weesp, whose population doubled in the second half of the 19th century. Casparus Jr. had himself built a 99-room Jugendstil villa in Weesp. Work was started in 1897 but was not completed until 1901, the year he died.
The Van Houten company was sold in 1962 to W.R. Grace, and the factories in Weesp closed in 1971. The Van Houten brand name, still in use, has been transferred several times since, most recently in 1990 from the German chocolate manufacturer Jacobs Suchard to Philip Morris.