Tea Box Raises Funding from Ratan Tata
TeaBox announced that Ratan Tata, chairman emeritus of Tata Sons, had made an undisclosed investment in TeaBox. Tata will join the company as an advisor. The company, the founder claimed, has shipped over 30 million cups of tea over the last year. In March, the company closed a round of $5 million in Series-A funding, led by Accel Partners. This round of investment was a way of getting of Tata on board. He will pick up a small stake in the company.
Tata has been on a spree of small investments in various e-commerce companies across the country. Earlier this month, the 78-year-old had made another small investment in online pet store Dogspot. Tata’s investment portfolio now has more than 20 companies, which includes Snapdeal, Ola, Urbanladder, Cardekho and Bluestone among others. He is also an advisor with Bengaluru-based venture capital fund Kalaari Capital. “We use artificial intelligence to deconstruct the customer’s palate,” said Kaushal Dugar, founder, Teabox.
The company has a subscription-based service where the customers are asked to answer five questions, which judge what they may like.
The AI then uses an algorithm to understand, based on choices by other customers, to understand the leanings. The customers are then sent a box of tea, which the algorithm has decided for them.
“Tea is as intricate as wine and customers learn that the regions and flavours are extremely important,” he added.
When the order is taken, Teabox’s algorithm, then based on pincode calculate the best logistical route and the order is shipped.
“Once delivered, we ask customers to share their feedback that is once again given as parameters to the AI, which tries to refine the choices,” Dugar said.
TeaBox, whose average ticket size is Rs 5,000, finds 95% of its customers overseas. “We have had orders worth Rs 1.5 lakh as well,” he said. The shipments, Duggar added, had grown two-and-a-half times over the past year and he expected them to continue to rise.
He said that he anticipated using Tata’s experience in building the Tata Tea brand to make Teabox a global giant. “There are markets such as Russia where we have no experience with and we are hoping he helps us understand those countries,” Duggar said. He explained that though Tata’s presence will not only help open doors for investors it will also lend credibility to his efforts.
The duo met in the first week of January and the turnaround time for the deal was “just a few hours”. But what is Tata’s favourtie tea? “I don’t know yet. We gave him some to take home but are waiting to hear back from him,” he said laughing.