Siliguri and Bengaluru-based Teabox, an online seller of premium tea has raised $7 million in its series-B round of funding from Singapore-based investment firm RB Investments, with existing investors also taking part.
DBS Bank also participated in the funding round through venture debt. Global investment banking firm o3 Capital that provides independent advice on mergers and acquisitions and capital raising acted as an advisor to the deal.
The Ratan Tata and Accel-backed startup will use the proceeds to expand its back-end infrastructure, including its cold chain processing centres and support growth in key markets.
In 2015, Teabox raised $6 million in Series A funding led by Singapore-based VC firm JAFCO Asia and existing investor Accel Partners, along with Keystone Group LP and Dragoneer Investment Group. The firm may extend the current round to $10 million as it continues talks with other interested investors.
“Tea has been around for hundreds of years, which means that the industry is flooded with big players. With tough competition in the market, we still set out to deliver, 5 years ago, what we believed would add a certain value to tea consumers across the globe. And that was to make fresh teas accessible to all and to enhance their overall tea experience. Looking back, Teabox has done justice to that,” said founder and CEO Kaushal Dugar.
Founded in 2012, Teabox currently ships a wide variety of premium teas from regions including Darjeeling, Assam, Nilgiris, and Nepal, across the globe from its warehouse in Siliguri.
The five-year-old consumer tea brand has gained worldwide popularity, especially in the United States, India, and Russia, selling over 40 million cups of premium Indian teas to consumers across more than 112 countries.
Besides the aforementioned investors, Teabox has attracted a wide assortment of investors, including the likes of Texas-based billionaire Robert M. Bass, who started out as a customer and then turned into an investor after identifying the unique potential of the early-stage venture.
In future, the company aims to automate packaging and other processes so that the company can increase its production by at least three to four times to meet ever-increasing demand.
Current investor RB Investments is a pan-Asia venture capital firm based out of Singapore that specializes in seed and growth-stage rounds. It has investments in Consumer Internet in India include Swiggy, FabHotels, Bluestone, Travel Triangle, Faaso’s, Beer Café, Tapzo, Pretty Secrets, etc.
Tea startups have become a hot thing in this winter. Of late Kolkata-based café chain startup Chai Break raised Rs 5 crore in angel funding round in lieu of 10% stake from Venture Catalysts of Mumbai. This funding round was followed by Delhi-based premium tea e-tailer Vahdam Teas, which raised $1.4 million in its second round of funding led by existing investor Fireside Ventures.
A number of other tea startups in India have also raised funding over the past months. In October, Gurugram-headquartered tea cafe chain startup Chaayos run by Sunshine Teahouse raised around $2 million from its existing investor Tiger Global Management in an internal round of funding. Prior to that, Chai Point, a Bengaluru-based tea chain raised fresh capital from existing investors for expansion.