These startups are brewing the perfect cup of tea for the chai-crazy Indian market

The popularity of the ‘teafe’ (tea and café) culture and the introduction of new varieties of tea has fuelled the growth of tea-based startups.

The tea market is primarily driven by the several health benefits associated with consumption as well as the increase in awareness related to carbonated drinks. Moreover, the popularity of the "teafe" (tea and café) culture, rise in disposable income, change in tastes, and introduction of additional healthy ingredients in tea by different market players have also fuelled the market growth.

Startups across the country are now bringing a variety to tea connoisseurs. In India, tea consumption occupies more than 79-percent share in the non-alcoholic beverage market, and is valued at more than $30 billion.

Exploring this market opportunity, the startups listed below are catering to the growing demand for this beverage:

1. Chai Point - Launched in 2010 in Bengaluru by Harvard alumnus Amuleek Singh Bijral, Chai Point claims that it serves about three lakh cups of chai per day across its channels – stores, home delivery, and dispensers. The company has built its own cloud-based software platform, called Shark, which connects the point of sale, supply chain, employee management, delivery system, auditing etc, at one place.
2. Chai Point has raised $30 million from Paragon Partners, Eight Roads Ventures, Saama Capital, DSG Consumer Partners, InnoVen Capital, and Everstone Capital.
3. Teabox - Founded in 2012, Teabox is focused on the vertical integration of sourcing, branding and distribution of teas. Their tea, available only online, is sourced from more than a hundred estates across Darjeeling, Assam, the Nilgiris and Nepal. The leaves are plucked, processed and packaged within one week using Teabox’s exclusive cold chain process. Founded by Kaushal Dugar, Teabox has raised $14 million from Accel Partners, Ratan Tata, Singapore-based angel investor Cameron Jones, JAFCO Asia, Horizen Ventures, Keystone Group LP, and Dragoneer Investment Group.
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5. Chaayos - Founded in November 2012 by IITians Nitin Saluja and Raghav Verma, the Chaayos network is spread across North India. It currently operates 50 cafes across Delhi-NCR, Mumbai, and Chandigarh. In Tiger Global Management’s first ever investment in a non-tech startup, Chaayos raised $5 million in 2015. Chaayos has invested in technology, and developed all its systems in-house, from the point of sale system and enterprise resource planning (ERP) to customer life cycle management, feedback and delivery software.
6. Udyan Tea - Based in Siliguri, Udyan Tea has pioneered ecommerce for tea in India. Started by three friends Punit Poddar, Parvez Gupta and Soveet Gupta in 2012, Udyan Tea focuses on providing information rather than only packaging. On their website, each product page offers information about that kind of tea to educate people about what they are paying for. Today they sell in the domestic market and ship to 25 countries, including the US, Canada, the UK, France, Luxembourg, China, Taiwan, Australia, Malaysia and Singapore.

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2. Chai Thela – Chai Thela is a chain of tea outlets based out of Noida, which provides the experience of a roadside thela (cart). They provide freshly brewed tea in a modern version of a roadside cart, offering hygienic tea at an affordable price point. They follow the kiosk model, and focus on IT parks and colleges. It was founded in 2015 by Pankaj Judge and Nitin Chaudhary, alumni of IIT Kharagpur. The company has raised Rs 1.5 crore from Delhi-based VC firm Quarizon.

Besides the above-mentioned startups, there are also companies where next-generation entrepreneurs are taking the legacy ahead.

Delhi-based Vahdam Teas is one such company. It targets the world market by shipping out tea leaves as close to the time as they have been harvested. It works with about 175 tea plantations and small growers in Darjeeling, Assam, the Nilgiris, Arunachal Pradesh, Himachal Pradesh, Sikkim, and Bihar, as well as in Nepal.

There is also The Tea Trove, which traces its roots back to 1917, when the Kanoi family owned and managed 42 tea gardens in Assam. Rishab Kanoi, the next-generation entrepreneur after profitably exiting the family business, launched The Tea Trove Café for Kolkata’s tea lovers in 2012. The Tea Trove offers a variety of teas and blends through its kiosks in Kolkata and New Delhi.