Coffee chain phenomenon, Third Wave Coffee, has successfully secured a substantial $35 million in a Series C funding round, with the leading role played by the renowned private equity firm, Creaegis. The round also witnessed participation from existing investors such as WestBridge Capital and Udaan co-founder, Sujeet Kumar.
Expansion and Technological Advancement The company has announced plans to allocate the newly acquired capital towards expanding its reach across the nation, reinforcing its supply chain and making significant strides in technology investments. Although the official valuation remains undisclosed, estimates by ET suggest it to be around the $150 million mark.
Growth and Presence Across India Established six years ago, Third Wave Coffee operates across various Indian cities, offering a blend of curated food menus and carefully handpicked coffee. The coffee chain is positioned in multiple cities including Hyderabad, Coonoor, Bengaluru, Delhi (NCR), Mumbai, Chandigarh, and Pune, boasting around 105 stores, with Bengaluru housing 50% of the operational outlets. The company has robust plans to inaugurate approximately 50-60 more stores across metro and tier I cities within the year.
Previous Funding Rounds Founded by Ayush Bathwal, Anirudh Sharma, and Sushant Goel, Third Wave Coffee has a history of successful funding rounds, previously raising $6 million in December 2021. Furthermore, in May 2022, a Series B round led by WestBridge Capital facilitated an additional $21 million investment into the Bengaluru-based coffee chain.
Competing in a Saturated Market Third Wave Coffee navigates through a market teeming with competition, contending with globally acknowledged coffee chains such as Starbucks and other specialized brands like Blue Tokai, Sabko Coffee, Rage Coffee, and more. Interestingly, Blue Tokai recently raised $30 million in its Series B funding round, emphasizing the vigorous investment activity in this sector.
Financial Trajectory The financial disclosures for FY23 are yet to be released by Third Wave Coffee; however, the company reported a notable 2.7X growth in operating revenue, reaching Rs 31.75 crore in FY22. However, the losses also experienced a surge, escalating 3.3X to Rs 14.5 crore in the same fiscal year.
Creaegis’s Investment Spree This investment comes as the second venture by Creaegis within a week, post-launching its $426 million maiden fund focusing on Indian startups. Previously, Creaegis extended its support to Doceree and holds several other firms like Medikabazaar, Zopper, and Kale Logistics in its portfolio.
