When Matt Chitharanjan, co-founder of Blue Tokai Coffee Roasters, moved to San Francisco to work as a real estate and finance consultant in 2003, the specialty coffee movement was taking off in the citadel of technology giants. A coffee lover from his high school days, roasting coffee became a hobby. In 2012, it turned into a business in India.
The company is a full-stack specialty coffee player that operates at all levels—right from farm interventions and scoring to roasting, packaging and selling through different channels, including own website, physical outlets, e-commerce marketplaces, modern trade and third-party retail. It has also entered into partnerships with marquee retail outlets, luxury hotels and restaurants, corporates and co-working spaces. In just nine years, it has become a ₹100 crore revenue company with 65% gross margins.
What differentiates Blue Tokai from others is its specialty focus with affordability. For instance, 250 grams of Organic Rosewood Blend coffee power, which has ingredients like dark chocolate, stone fruit and roasted almonds, costs ₹450, compared to ₹570 per 200 gm Nescafe Classic Instant Coffee Powder. More than half the sales happen through cafes (dine-in and retail combined) while online contributes over 20%. The B2B segment is close to 15%.
This year, the company is looking to double revenues to ₹200 crore. Chitharanjan was born and brought up in U.S. as his parents were professors there. He moved to India in 2011 to work at Institute for Financial Management and Research in Chennai on projects in SME financing. “I spent my entire career doing desk jobs, and by 2012, both my partner Namrata and I were at a point in our lives where we wanted to create something we could call our own. I was a home-brewer, so we considered opening a brewery, but licensing and investment seemed prohibitive. Coffee was something we were both passionate about. Since we had difficulty finding good coffee in India, we sensed the market gap,” he says.
In 2015, Blue Tokai got connected to Snow Leopard, and it became their first investor. Investors now own 60% stake in the company. The idea is to build Blue Tokai as India’s specialty coffee to the world. — Nevin John