INDIA – Specialty coffee brand startup Blue Tokai Coffee Roasters has secured US$30 million in its latest Series B funding round to scale its business further and expand its presence in specialty coffee markets worldwide.

The round was led by Mumbai-based investment firm A91 Partners having new and existing participants including White Whale Ventures Grand Anicut Fund and 8i Ventures.It also saw some angel investors sell shares.

At the funding, Blue Tokai said it is also working towards introducing a set of new FMCG products, further strengthening its customer experience and supporting small-scale independent farmers to stay true to its commitment to ethical sourcing.

Founded in 2013 by Matt Chitharanjan, Namrata Asthana, and Shivam Shahi, Blue Tokai operates through three different channels, including cafe stores, marketplaces & its website along with B2B channels.

Data from the research platform Tracxn showed that the Gurugram-based company raised $41.1 million in 2022, up from $11.4 million in 2021.

The coffee brand is expected to have been valued at Rs 650 crore, post the investment round, according to people close to the deal.

However, Blue Tokai did not disclose its valuation, with Chitharanjan saying it had seen a three-fold increase in valuation over its last fundraising round. He added that less than 10% of the amount raised, or nearly US$3 million, is a secondary component, while the remaining is fresh capital.

He further noted that the startup plans to 200 new stores over the next three years in four more cities, adding to its current footprint of 60 stores spanning nine major Indian cities and regions. Blue Tokai’s cafes account for nearly two-thirds of its revenue.

The company reported Rs 74 crore in revenue for the year ended March 31, 2022, and is clocking a revenue run rate of Rs 150 crore for the ongoing fiscal year, Chitharanjan said, adding that Blue Tokai plans to become profitable by next year.

Shivam Shahi, CO of Blue Tokai, explained that the company will invest in its B2B arm, bringing new technology for its partners through our machine offerings in a bid to achieve more profits.

Abhay Pandey, the general partner at A91 Partners, highlighted that, with increasing availability, coffee is emerging as an alternative beverage choice in India.

“People are consuming more coffee, even in other countries like China, where there is a strong tea culture. We believe that this is bound to happen in India over the next decade, and we will see high growth rates in this period,” Pandey said.

“We are getting into that virtuous cycle of demand and supply reinforcing each other in India.”

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