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• REACH : The tea chain is spread across Delhi, Noida, Gurgaon, Mumbai, Chandigarh,
Ghaziabad, and Karnal.
• TARGET MARKET : The target market for Chaayos is Upcoming middle class that has money
but is equally conscious of the value they get. The Chai drinkers that visit their outlets are
between the age of 18-45 and are mostly working professionals.
• MARKETING STRATEGY : They mainly believe in word of mouth. Overall, on the online end,
they make use of the social media and email marketing to keep in touch with the customers.
Using the same medium they also keep them informed about the promotional activities and
new additions. On the offline front, they make use of “Below the Line” strategy, and offer
dedicated loyalty programs to its customers.
FUNDING
• Gurugram-headquartered chai startup, Chaayos, In May 2015, the company raked
in $5 Million Series. A funding from capital firm Tiger Global Management. It
marked Tiger’s first investment in a non-technology consumer startup in the
country. Chaayos has recently raised funds from its main investor Tiger Global.
The funds were raised through a rights issue, which was closed a few weeks ago.
Tiger Global invested close to $2 Million in the company.
• As per reports, the investment is part of an internal round of funding and will be
used to expand the chain of tea outlets currently operating under the Chaayos
brand.
FUNDING DATE AMOUNT INVESTORS
Tiger Global
Equity Oct 2017 $2M
Management
Tiger Global
Series A May 2015 $5M
Management
Total: $7.3M
GROWTH
• Chaayos was born in November 2012, out of a basic principle – a modern version of Chai adda, that
served freshly made Chai.
• Chaayos was a bootstrapped concept that started with an initial infusion from Nitin of ₹25 lakhs of his
savings (of which he used ₹12 Lakhs initially), with a simple premise that – he would give it 6 months,
after which he would either put in another ₹12 lakh or close it down.
• But to his surprise, his first outlet broke even operationally within just 3-4 months of opening itself.
• Post that, Raghav Verma joined Chaayos with an equity partnership, because his online education
company didn’t work out. Thus, filling the missing gap!
• Raghav turned out to be lucky for the Chaayos! Soon after his entry, Chaayos received their first angel
funding of ₹2.1 crores from Powai Lake Ventures, which was used to open more stores.
• In a span of roughly two and a half years, Chaayos opened seven more outlets and had expanded to a
staffing of 50. Their highest grossing outlet was now closing a turnover of ₹1 crores in annual revenues.
• Since then, Chaayos has got into an aggressive expansion in all verticals. Today, they run 25 cafes in
Delhi NCR and Mumbai, with gross margins as high as 65-70%, and annual turnover of ₹9-10 crores
(2014-15).
• The café also claims to clock 600 transactions per day with an average footfall of 700 customers per day,
and have expanded to a team of 400 employees.
• So far, the company has raised a total of $5 Million from past investors, along with Tiger Global
Management as well. They are also in preparations to expand to all major metro cities like Bangalore,
Pune, Hyderabad and Chennai, as well.
Revenue :
• 80% of Chaayos revenue come from Offline stores. By March 2018, Chaayos will
have around 80 stores. Chaayos is looking to save upto Rs. 18 Crore through its
partnership model.
• The revenue earned is 55% from beverages and 45% from its food.
• Online Business : People can also order online from www.chaayos.com, Zomato,
Swiggy, Food Panda etc
• For the year ending 2016, Chaayos posted a turnover of Rs 11.8 Crore, a 247%
increase from Rs 3.4 Crore in the previous year.
Competitors:
• Chai Point has been one of Chaayos's top competitors. Chai Point was founded in
2010 in Bangalore, Karnataka. Chai Point generates $5.5M more revenue than
Chaayos.
• Infinitea is one of Chaayos's top competitors. Infinitea was founded in Bangalore,
Karnataka} in 2003. Compared to Chaayos, Infinitea generates $1.8M more
revenue.
• Chaipatty is also one of Chaayos's top rivals.. Chaipatty generates 125% of
Chaayos's revenue.
• Road side tea stalls: People love to have Chai from roadside but they are mostly
unhygienic.
• Machine Tea available at Offices.
• The biggest Competition for Chaayos is the homemade tea. Indians love Chai.
And on daily basis Chai is made at every home. So why would people take out
their money for just a cup of tea.
Conclusion
Though Chaayos face a lot of competition in market, but still it has
been growing from past years. It has got a competitive edge as there is
high customization in the products, as well as the menu is very broad to
suit both Indian as well as Western patterns. They serve affordable
products and at the same time maintain the quality of Chai.