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How Chaayos is brewing a niche

business Updated: May 03, 2016 11:24 IST
Sunny Sen

Chaayos co-founders, Nitin Saluja (left) and Raghav Verma(HT File)

Think about going out for a cup of coffee, there are Starbucks, Costa Coffees and Café Coffee Days. But, none for a cup of tea, at least not before Chaayos came into existence.

Chaayos is a chain of 25 cafes that serve tea, customised in 12,000 ways.

“Don’t be surprised. No one offers tea in a more personalised manner – be it ingredients, less or more milk, various flavours or mixing flavours,” said Raghav Verma, co-founder of Chaayos. It offers tea lovers flavours such as hari mirch chai and aam papad chai. For a moment, Chaayos’ entry can be dismissed as a flash in the pan, or maybe not. When Café Coffee Day opened its first café in 1996 on BrigadeRoad in Bangalore, no one thought two decades later it would have more than 1,500 cafes, making Rs 1,326 crore.

But, Chaayos’ rise is no match for the coffee chains (India has more than 2,500 coffee shops). Verma throws some statistics – that’s the market he is targeting – an average Indian consumes two cups of tea every day, with domestic consumption of more than 900 million kgs of tea.

Chaayos should be present at every tea drinking occasion – there is online delivery for homes and offices, packets of tea to brew at home, cafes for outings and hangouts, and Indian munchies as accompaniments. Online delivery is the fastest-growing segment, at 40-50% a month. “Nobody has delivered tea globally, even Startbucks started delivering coffee recently,” said Verma.

With an average order size of `200-300, every café operationally breaks even in four months. In 2016, Verma hopes to open in Pune, Hyderabad, Chennai and Kolkata. The company has raised $5 million (`33 crore) from Tiger Global and other investors.

Chaayos is not the only one trying to revolutionise tea drinking. Tea makers such as Wagh Bakri have tea lounges (four so far), but more to experience its flavours. A bunch of startups are in the race, too.

Tea Trails, which started in 2013, plans to have 500 stores.

Chai Point is another fast-growing chain, and there is Teabox from the hill town of Siliguri that has raised $6 million (Rs 40 crore) from Accel Partne

However, Verma wants to build a global chain for tea lovers. It is already dawning a cosmopolitan image – coming Mother’s Day there will be special offers and even tree cups of tea for “single moms”. And there is more – no two Chaayos look the same – each one has a theme – but if Chaayos has to be a CCD or a Startbucks, Verma will soon run out of themes.