Bangalore-based Mountain Trail Foods Pvt. Ltd, operator of the Chai Point network of tea stores, has raised $20 million (Rs 131.5 crore) in a Series C round of funding led by private equity firm Paragon Partners.
Existing investors Eight Roads Ventures, Deepak Shahdadpuri-led early-stage investment firm DSG Consumer Partners and venture capital firm Saama Capital also took part in this round, Chai Point said in a statement.
VCCircle had reported in October last year that Chai Point was looking to raise $15-20 million and had hired banker to scout for potential private equity investors.
Amuleek Singh Bijral, co-founder and CEO of Chai Point, said a substantial portion of the investment proceeds will go towards deepening the company’s sales, marketing and service operations for the automated hot beverage dispensing business boxC.in.
Siddharth Parekh, co-founder and senior partner of Paragon Partners, will join the board of the company.
Investment bank DCS Advisory India, earlier known as Signal Hill Capital, was the exclusive adviser to Chai Point for this fundraise.
This fresh infusion takes the total Chai Point has raised until now to $34 million, according to the statement.
In August 2017, the company had mopped up Rs 19 crore ($2.9 million) in a bridge round of funding led by Eight Roads Ventures.
In 2015, the company received $10 million in Series B round of funding led by Eight Roads.
Chai Point was founded by Harvard-graduate Amuleek Singh Bijral and Tarun Khanna in 2010. The company mainly offers tea with traditional flavouring ingredients such as ginger, masala and lemon. It also serves popular snacks such as samosas and egg puffs.
Chai Point is set to launch its 100th store next month, according to the release. It competes with tea café operator Chaayos. It now also competes with coffee retail chain Café Coffee Day with its BoxC dispensers for coffee and tea inside corporate offices.
The company’s revenue rose to Rs 56 crore in 2016-17 from Rs 36.4 crore the previous year, according to its filings with the Registrar of Companies (RoC).
Other tea retail funding deals
Delhi-based Chaayos, run by Sunshine Tea House Pvt. Ltd, had secured $5 million in its Series A round of investment led by Tiger Global in 2015.
In December 2017, speciality tea e-tailer Teabox.com, operated by Bengaluru- and Singapore-based AsianTeaxpress Pte. Ltd, raised $7 million in a Series B round from Singapore-based investment firm RB Investments and existing investors.
The same month, Vahdam Teas mobilised $1.4 million in a Series A round of funding led by existing investor Fireside Ventures.