Specialty coffee startup Blue Tokai raises $35 million from Verlinvest at $180 million valuation

Blue Tokai founders (L to R): Shivam Shahi, Namrata Asthana and Matt Chitharanjan

Blue Tokai, a specialty coffee and bakery brand, has raised $35 million in a fresh round led by Belgium’s Verlinvest, a family-backed investment firm. Existing investors Anicut Capital and A91 Partners also participated in the round which now values the startup at around Rs 1,500 crore (about $180 million), up from around Rs 700 crore at the beginning of 2023.

This is Blue Tokai’s second investment in under two years as investors rush to back consumer companies amid sizzling demand. In January 2023, the company had raised $30 million in a round led by A91 Partners and then a few months later, it also saw actress Deepika Padukone cut a small cheque as competition in the space heats up.  

The funding into Blue Tokai comes at a time when its arch-rival, Third Wave Coffee, is seeing a management rejig amid increasing competition. Apart from that, it also competes with Slay Coffee, Sleepy Owl Coffee, Hatti Kaapi, and other chains such as Cafe Coffee Day and Starbucks, among several others.

Blue Tokai will use the fresh funds to deepen its presence in existing metro markets and expand into new Tier I & II cities in India over the next three years, as premiumisation becomes a prominent theme across markets.

“We will utilise these funds to accelerate our expansion across all channels – from our own cafes to B2B and B2C platforms.  By introducing innovative coffee product offerings through new producers, we will enable ourselves to reach new consumers with varied offerings and continue delivering consistent coffee experiences,” Matt Chitharanjan, Co-founder and CEO, Blue Tokai, said.

Founded in 2013 by Chitharanjan, Namrata Asthana and Shivam Shahi, Blue Tokai has doubled its store count in the last year to 130 outlets currently. The newly acquired funds will be used to expand to over 350 locations in the next 30-36 months, drive new product innovation, and expand to new channels.

“Matt, Namrata, and Shivam have brilliantly crafted a cult brand known for its exceptional products and customer experience. Together, we are committed to elevating Blue Tokai to new heights, creating India’s leading coffee chain and delighting consumers with unparalleled quality and service," said Arjun Anand, Managing Director & Head of Asia, Verlinvest.

Verlinvest backs other companies like Purplle, Byju’s, Veeba, Epigamia (also backed by Deepika Padukone) in India.