Chai Kings eyes $2-mn fundraise to open 80 outlets in 20 months

Chennai-based Chai Kings plans $2 million expansion, aiming for 80 outlets in 18-20 months with venture capital funding.

City-based Chai Kings is planning to raise $2 million as part of its expansion plans to open 80 outlets in 18-20 months, said its CEO Jahabar Sadique.

“We have initiated talks with venture capitalists to raise the much-needed funds [the lack of which] that derailed our expansion plans. We need it during FY25/26 to foray aggressively into neighbouring States,” he told The Hindu.

Currently, Chai Kings has 56 outlets of which 50 are in Chennai. As per the original plan, the B2C firm was to open more outlets in Chennai, Hyderabad and Bengaluru. But the plan couldn’t take off on account of the pandemic.

“Before the pandemic, we were selling 25,000 cups per day. We have crossed the pre-COVID level and are selling around 30,000 cups. Our aim is to sell one lakh cups per day in 20 months,” he said.

“Aided by angel investors, we raised ₹9.65 crore in the pre-series funding. The series A funding of ₹16 crore will help us to move into Bengaluru, Hyderabad and Tier-II cities of Tamil Nadu,” said Chief Operating Officer S. Balaji.

Stating they were not in favour of a franchise model, Mr. Balaji said plans were afoot to open 23 more outlets in Chennai, 24 in Hyderabad, 25 in Bengaluru and eight in Coimbatore.

“Though we struggled to establish our business in 2016, it became a hit as the existing tea shops lacked cleanliness, offered only one type of tea with takeaways were either in a flask or plastic covers. Besides, it was a meeting place for youngsters either to hang around or read newspapers,” he said.