Who doesn’t love a good cuppa of chai?! It gets our days started and gives us a refreshing break whenever needed. No wonder, Indians have become ambassadors to spread the love of chai. One such ambassador is Siddharth Jain, who is the CEO and Founder, Brewhouse Ice Tea.
Siddharth was formerly an Investment Banker in Mergers & Acquisitions with BNP Paribas in Singapore for over six years before coming back to India to launch this venture. He is an MBA from IIM Calcutta and an alumnus of Delhi University.
Here is a candid conversation with this ambassador of the love of tea.
The idea of the startup
The idea of the startup was born out of Siddharth’s passion for tea and the realization of the need for healthier and natural beverage products that could complement all food combinations.
Siddharth is the sole founder and CEO. He developed the brand and the initial flavours and got a seed stage angel investment from Dheeraj Jain after which the brand was launched in May 2017.
After the brand got some initial traction, the venture raised funding from Food Empire Holdings of Singapore in November 2017 and started building a team.
Key team members include Dhruv Kapur (ex-Yoga Bars, Grofers) who looks after Sales, Depinder Bedi (Ex-Red Bull) who looks after Marketing, Animesh Mishra (Ex-Bacardi, Varun Beverages) who looks after Operations and Pranab Ghosh (Ex-Devyani International) in Finance.
The initial investment
The venture has raised US$2.6 Mn from Food Empire Holdings, Singapore in two rounds of funding.
The three most important challenges the startup has faced in the initial phases are:
i) Manufacturing Setup – Since the product was planned in glass bottles, there were no third party bottlers to manufacture the product.
As setting up a large facility for an untested product did not make sense, the startup was stuck between a rock and a hard place.
The founder says, our focus on quality and international investors also meant that manufacturing quality had to be world class.
It set up a small scale manufacturing unit of in Sahibabad, but it made sure that it followed international best practices in terms of hygiene and processes while keeping the capital expenditure low.
Distribution – Distribution is always a challenge in India as it’s a large country with millions of selling points, most of which are unorganized. Reaching many stores and servicing them requires a large sales force which is time-consuming to hire and expensive to maintain.
Finding the right people –Find people who share the same vision and enthusiasm for the purpose is always a time-consuming process and sometimes mistakes are made in hiring, but in the process, Siddharth says, “We’ve been really lucky to find some incredibly smart and motivated people who are genuine co-founders in spirit”.
Since the inception in May 2017 with a few QSR chains and it started building its retail presence in January 2018.
Factors that worked for Brewhouse Ice Tea
Some of the factors which worked for the startup are as elaborated by Siddharth are:
i) Focus on the ice tea category – The fact that we are passionate about ice teas and we are focused on this category allowed us to approach this category with a lot of enthusiasm and we were able to tap into not just the audience that loves ice teas but also those who were earlier on the fence with respect to the category.
ii) Focus on product quality – Given our passion for the product, we are committed to creating the best possible product, even when that becomes difficult or expensive.
For example, choosing to do real-brewed tea over tea concentrates or extract and choosing to use glass bottles instead of plastic.
iii) Focus on building a great team – We’ve been lucky to find some great people and we’ve always believed that to build a great business we first have to build a great team.
Our focus has been on finding people with passion and drive more than experience necessarily and that really has been the reason behind our success so far and is what will keep us strong in the long run.
Expansion plans for 2019
Currently, the product is available at over 2,000 points of sale across the country with 50% of these points in Delhi NCR alone. The former banker claims, “We are expanding our footprint nationwide and the goal for 2019 is to reach 10,000 points of sale across the top 20 cities in India.”
Competitors and how Brewhouse Ice Tea is different
Siddharth says, “We compete in the alternative beverage space so all non-carbonated, non-juice beverage brands are our competitors. Moreover, we are also competing for share of wallet with all healthier beverage options”.
We are different because we are in ice teas where very few brands exist and we are also the first and only real-brewed bottled ice tea. We’re also one of the very few brands with such a low sugar content.
USPs to drive customers to the product
Brewhouse Ice Tea is India’s first real-brewed bottled ice teas – not made from a powder or concentrate. Not too sweet – 40 to 70% less sugar than most bottled beverages. No preservatives, nothing artificial. Affordable premium at INR 60 for a 350ml glass bottle. Strong branding and attractive packaging. These are the factors that customers have found attractive about the product.