Teabox: More brews after recent financing

 Goutam Das   New Delhi     Last Updated: December 18, 2017  | 18:24 IST
Teabox: More brews after recent financing
PC: Facebook/Teabox

Teabox, a tea brand start-up founded in 2012, closed a $7 million Series B round last week. Singapore-based investment firm RB Investments, existing investors, as well as DBS Bank Ltd participated (DBS through venture debt).

Business Today spoke to Founder and CEO Kaushal Dugar on the company's plans, going ahead.

1. The start-up has aggregated about 150 gardens in India and Nepal; its site has 250 varieties of tea. Prices range from Rs 8,000 a KG to Rs 1.6 lakh. It has an average ticket size of $52. The company said that with the latest funding, it would be able to expand its back end infrastructure including cold chain processing centres as well as support growth in key markets.

2. The company, thus far, was largely an e-commerce play where it aggregated tea gardens from India. Going ahead, the start-up wants a smaller offline presence in the country as well that will help build more awareness. Airport stores, besides traditional gourmet retailers are the target. This will expand Teabox's market, hopes Dugar, because as of now, "unless you are a tea snob, you will not go to the site". Another effort to expand the market was in January 2017 when the company launched tea bags; it just sold loose tea before.

3.  A significant chunk of the start-up's revenues are generated outside the country. United States is its largest market, generating 40 per cent of its sales. About a year ago, Teabox had launched a subscriptions model, which has worked well in the United States. Subscriptions is now 14 per cent of its overall revenue pie. Russia, U.K., and India are large markets as well, in that order. India contributes just about 13 per cent of sales. Dugar says the U.S. premium tea market is $2.1 billion whereas India is just a half a billion market.  Rather than premium tea, 'chai' has the dominant share in India. The go-to-market will remain online in the exports business. 

 

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