Teabox raises $6M Series A funding from JAFCO and others
Teabox, the Siliguri based startup that caters to the worldwide tea-lovers market and intends to become the first “Made in India” consumer focused global brand, has raised $6mn in Series A funding led by JAFCO Asia and with participation from Accel Partners, Keystone Group LP and Dragoneer Investment Group. Teabox had earlier raised $1mn in seed funding from Accel Partner and Horizen Ventures in early 2014.
Founded in 2012, and led by a single founder, Kaushal Dugar, Teabox is a premium tea brand that is focused on vertical integration of sourcing, branding and distributing teas - while upending the traditional tea-retailing model in the process. They source the best of the tea blends from Darjeeling, Assam, Nilgiri & Nepal and ship to worldwide consumer through their online portal Teabox.com. Till date they have shipped over 20 million cups of teas to over 75 countries and generate over 95% of their revenue from customers outside India.
Speaking on the new fund raise, Kaushal Dugar, Founder & CEO, Teabox shares - “We are extremely privileged to have JAFCO and Dragoneer as our investment partners as we expand into new markets, primarily – China, Japan and Korea where they have strong connect and also to have Robert Bass who first discovered Teabox as a customer and has now participated in this round as an investor through Keystone Group. And of course Accel has been our growth partner helping and guiding us since they came on board post seed funding”
“The current fund raise will be primarily be utilized to build the back-end infrastructure to enable transactions and order processing for the new markets and also to hire new talent across different verticals.” – adds Kaushal.
Although India has been supplying teas to the world for the past 200 years, we haven't witnessed the emergence of any premium tea brand operating on a global scale and Teabox intends to become that brand. But its not going to be easy and will need huge amount of process innovation, operational optimization and of course worldwide customer excellence.
Imagine selling premium teas to consumers across the globe without having a retail presence and without them smelling, touching or tasting the teas prior to purchase. Seems difficult isn’t it? So how did Teabox solve this? Kaushal shares – “We employ a multi-pronged approach to mitigate these problems. For example, we've made it really easy for skeptical buyers to try out our samples for a very small price, customers can choose from a variety of subscription plans to receive curated boxes of delicious tea samples for $20/month. Also our website teabox.com hosts over 300 reviews from genuine customers from across the world and our story has been covered by a number of international dailies including The New York times. All of these things help us build our credibility. But all said and done, what's really worked well for us is good old word of mouth.”
In last one year, Teabox claims to have seen 10x growth in terms of orders/revenue while their team has grown by 3x. They have shipped teas to 75 different countries and the 75th country was Iraq where the customer who ordered the teas was on a teaching assignment in Kurdistan. And they also have paying customer from little known countries such as Fiji islands, Haiti & Micronesian islands.
There couldn't have been a better testament to the quality of the product when the customer comes on boards as an investor. Here’s what Robert M. Bass, President of Keystone, who is a customer turned investor in Teabox had to say, “We are delighted to be partnering with Kaushal, JAFCO, Accel, and the entire Teabox team. I am a longtime tea drinker and first discovered Teabox as a customer. Given the superior quality of the company’s product and its innovative approach to sourcing, marketing, and distribution, we see great things ahead for Teabox.”
Talking about the significance of this investment, Supriya Singh of JAFCO said, "Teabox’s disruptive business model is highly scalable and allows complete control of the customer experience. JAFCO's expertise across different markets will add significant value to Teabox in the coming months."
"We are excited to continue our association with Teabox in building the first vertically integrated consumer brand to come from India.” – added Prashanth Prakash from Accel Partners.
Speaking on next phase of growth for the company, Kaushal shares – “Primarily we have been focusing on three things: people, technology and building a clear understanding of our customers. Over the last few months, we've invested heavily in all of these areas and we believe these would help us reap big benefits in the coming months. We are also actively exploring the option of setting up experiential stores in our key target market areas such as US & Russia. We are also looking to set up new sourcing centers in other tea producing regions such as Assam, Nilgiri & Kangra.”Kaushal shares, Teabox has hired a product manager from Starbucks to help them productize and scale up their operations and are in advanced talks with one of the leading tea expert to join them in building a global business. They have got on board one of the world’s foremost design consultancy to help them create a new brand image and enhance their desktop and mobile user experience. They are also setting up cold storage plants at Siliguri to ensure they deliver the freshest of teas to their customers globally.
In case if you are a tea lover, do give them a try – http://teabox.com
