Entering a fresh marriage with a not so promising start-up is a risk not many people take. In such a situation, one might advise you to sit tight and hope for things to get better. But Pankaj had less than a month to go until his wedding when his co-founder announced his departure from the venture. The start-up was about to shut down. He didn’t bat an eyelid and shared everything with his wife-to-be. She knew he was about to go broke and business would shut down. She stood by him.
Pankaj decided to start again. He met his present Co-founder Nitin Chaudhary through a common friend and both of them agreed to start in the field of tea business. Pankaj says, “I discussed the idea of starting something with chai and he said, ‘Yes! lets do it!’ I said let me come back after the wedding and start it. Even during my honeymoon period, I was pondering over [the startup] idea than getting lost in the beautiful beaches. Together, Nitin and I structured the idea into plan B, and it took two months to finally start.”
Chai is unofficially christened as the national drink of the country, and the consumption of tea is not confined to any one region. The good part about getting into tea business is that unlike coffee business where we already have big players like Cafe Coffee Day, Barista, and Starbucks, the market for tea has still not been captured with only a few players in the field.
Chai Thela is a chain of tea outlets based out of Noida looking to provide the experience of a road-side thela (cart).The main factor that differentiates them from others is that they provide freshly brewed tea.
Talking about the name Pankaj says, “I remember my father-in-law asking me to change the name Chai Thela to something like tea café or joint in order to not feel embarrassed when he has to say my son-in- law runs Chai Thela.
Also, once Nitin’s relative ridiculed him saying – Pehlaydarubechtatha, ab chai bechtahai. Chalokuch to achakiya (earlier he used to sell liquor, now he sells tea. At least he has done something better). “
Before joining Pankaj with Chai Thela, Nitin was working with Liquor Retail Company. They prepare tea on demand and try to refrain from storing tea in flasks as much as possible. Chai Thela has a kiosk-based model, and it’s focused on IT parks and colleges as their prime market. Started in February this year with a two-member team, they’ve grown to 32 employees and six outlets. At present, they’ve scaled to a volume of serving up to 500-600 cups from each outlet every day.
In recent years, the number of startups in this sector has been on the rise. Chai Point, the biggest contender, raised INR 10 crore earlier this year in a round by Saama Capital. Chaipatty, Infinitea, Tea Trails and other tea cafes that started in recent years have expanded to major metro cities to cater to the large market there. The current tea market in India is estimated to be around INR 20,000 crore, and most of it is yet to be penetrated. Most startups have not entered Tier-2 cities where the majority of the market lies. We are yet to see players entering that market.
Challenges faced by Chai Thela
Pankaj says the biggest challenge while starting up was access to capital. Nitin, Pankaj’s Co-founder, borrowed money from his brother; for Pankaj, his best friend came to the rescue and helped him out with some capital to startup. However, there was a bigger problem which lay ahead. Says Pankaj,
“A new married life needs and deserves time. And, time was the only constraint I had when it came to Shweta (my wife). The rituals of frequent dinners, outings & shopping were hardly followed. She would be frustrated at times. Even our first Valentine’s Day was spent with vendors and prep arrangements, because the first counter was to start three days later.”
They’re looking forward to opening 1000 more outlets in the next five years, and hope to expand to at least five cities by then. At present, they’re also looking to raise funds for expansion.