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Premium online tea seller Teabox on Wednesday announced the closure of its Series B funding of $7 million from Singapore-based investment firm RB Investments, with participation from existing investors.
Kaushal Dugar, founder-CEO of the five-year-old vertically integrated premium tea brand, told BusinessLine that DBS Bank will also be participating in this round through venture debt.
“The new financing will primarily help the company expand our backend infrastructure, including a cold-chain processing centre (at Siliguri), and support our growth in key markets.”
The current storage capacity of the cold-chain processing centre is 15,000-20,000 kilograms. This is expected to be more than doubled to 50,000 kilograms in the next 12 months, Dugarr said, and added that 15-20 per cent of the funds will be invested on the expansion of the cold-chain processing centre and automation of the production process.
A good chunk — close to 50-55 per cent — will be used for marketing the brand. “We have established a strong digital presence. We are now mulling to go multi-channel through offline formats by setting up our exclusive outlets at airports and partner with online marketers such as Amazon. We have a network of 150-plus suppliers across the country,” he added
The start-up is gearing up to drive growth innovations, going forward. “Our focus is to grow aggressively, enter the right markets, the right segments and build a team that will drive growth in the offline mode as well. We foresee great opportunity.”
Estate to cup The company sells over 40 million cups of premium Indian teas to consumers across 112 countries. Garden-fresh teas are procured directly from growers/estates from Darjeeling, Assam, Nilgiris and Nepal, blended into innovative products (value-added) and shipped to customers directly, cutting short the traditional distribution chain.
The company has on offer 250-plus range of teas.
“The end-to-end supply, from the growers to the cup, has helped Teabox drastically reduce the time-to-market from 4-6 months to under a week, ensuring only the freshest of teas reach the consumer,” Dugarr claimed.
The biggest challenge, he admits, “has been in getting people to understand that tea as a product can be sold online. Since we focus only on premium teas, priced upwards of ₹10,000 a kg, connoisseurs of tea and ardent tea enthusiasts have been our target segment.
“Volumes are growing. Our growth this year was up 2.5- per cent over the preceding 12 months. We are looking to sell 50 million cups soon.”
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