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Teabox raises funds from RB investments, DBS Bank, Accel Partners

Teabox will be available at gourmet stores such as Nature’s Basket and FoodHall in the next 2-3 months.

, ET Bureau|
Updated: Dec 14, 2017, 10.14 AM IST
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The premium tea market in India has been making significant waves.
The premium tea market in India has been making significant waves.
MUMBAI: Premium tea brand Teabox has raised Rs 45 crore($7 million) in a part equity-part debt round from Singapore-based investment firm RB Investments along with existing investor Accel Partners. DBS Bank also participated in the round through venture debt accounting for 5-7% of the total investment.

The Ratan Tata-backed firm will use the capital to expand its back-end infrastructure including cold chain processing centres, automating its manufacturing units and support growth in key markets such as US, Russia and now India. The Siliguri-based company is looking at beefing up its production capacity to at least three times more as a precursor to its offline strategy - one that will see it open stores across Bengaluru, Mumbai and Delhi.

“Apart from our own stores, we are also looking to feature ourselves in premium modern trade outlets and going really aggressive on it. This is the inflection point for us to transition from an online only to a pure omni-channel company,” founder and CEO Kausshal Dugarr told ET. Besides 2-4 stores in the three cities, Teabox will be available at gourmet stores such as Nature’s Basket and FoodHall in the next 2-3 months.

The premium tea market in India has been making significant waves, eating into the share of legacy brands such as Tetley, Twinings and Wagh Bakri. Targeting premium global customers across the Americas and Europe have given companies such as Teabox, Vahdam Teas, etc more than just a foot in the door of the Rs 12,250 crore market in India.

The shift in consumption patterns across millennial customers has also raked up investor interest in the space with investors tripling their investments in the consumer product startup ecosystem, with the first three quarters of 2017 alone witnessing inflows worth $230 million.

With Teabox counting 60-70% of its revenues from global markets, the omni-channel expansion plan is an attempt to capture the Indian market where having an offline presence significantly bumps up volumes and topline. “Whenever we have done a combination exercise (of online and offline), we have seen a multiplier effect. Our expectation is to grow at least 4-5 times post an offline channel,” said Dugarr.

Teabox, which sells its teas online through its website and Amazon globally, is expecting to close 2017 with a 3.5 times increase in revenue growth and expects the offline stores to contribute double-digit growth over the next few years.
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Teabox raises funding from Ratan Tata

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