Tuesday, September 26, 2023

Shark Tank S2: Sugar-loving shark buys into zero-calorie iced tea biz

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  • Jyoti Bharadwaj founded a healthy drink startup TeaFit in 2021, and it has sold ₹15 lakh worth of products as of now.
  • TeaFit serves more than 20,000 customers through online and offline channels.
  • Bharadwaj walked away with a collective investment of ₹50 lakh for 8% equity of four sharks, Vineta SinghPeyush Bansal, Anupam Mittaland Aman Gupta.

A mompreneur from Mumbai, Jyoti Bharadwaj, left everything behind Shark Tank India judges were impressed with her beverage company TeaFit. TeaFit produces low-calorie healthy drinks made with natural herbs and ingredients, without sugar or sweetener.

Launched in 2021, the brand will offer green tea, black tea, and barley tea, along with instant premixes. Bharadwaj, a fan of Shark Tank US and a mother of two young children, delivered a sharp pitch spewing small details about the product’s pricing and packaging.

At the start of the field, she took her two young children, eight and five, with her. They were part of her entrepreneurial journey, she told the judges.

“I have watched every episode of every season of Shark Tank US many times over the years. I’ve replayed so many of the pitches in my head – Scrub Daddy, Drink Poppi, Bantam Bagels and many others. I’m just so incredibly grateful to have been given a national platform to talk about TeaFit, why we do what we do and our vision for the future,” shared
Bharadwaj on her Linkedinfour days before her Shark Tank India episode aired.

The starting value zooms in from ₹ 2 cr to ₹ 6.25 cr

After tasting her tea on the show, even boAt co-founder Aman Gupta, who loves sugary drinks, was impressed.

Bharadwaj initially asked for ₹50 lakh for 3% equity which valued the company at ₹16.67 crore. She said TeaFit had received a ₹1 crore term sheet that valued her startup at ₹20 crore in convertible notes. A convertible bond is a type of bond offered by companies that can later be converted into stock.

Sugar Cosmetics co-founder Vineeta Singh and Shaadi.com founder Anupam Mittal jointly made the initial offer – ₹50 lakh for 25% equity, which valued the company at ₹2 crore.

Lenskart’s co-founder Peyush Bansal followed with an offer of ₹50 lakh for 20% equity, raising the value to ₹2.5 crore.

However, it was co-founder Aman Gupta’s offer of ₹50 lakh for 10% equity that immediately doubled the valuation to ₹5 crore. Bansal, Singh and Mittal immediately replied that they would match Gupta’s offer.

Bharadwaj sought collective investment of ₹50 lakhs from all four judges but for 8% equity. This valued the startup at ₹6.25 crore. The judges accepted this offer.

When mother-in-law became an investor

After graduating from Manipal Institute of Technology, Patna native Jyoti Bhardwaj pursued an MBA in Finance and Marketing from the Indian School of Business (ISB). She worked with startup UrbanFresh and real estate portal Housing.com before starting her entrepreneurial journey with TeaFit.

TeaFit got its first investment of ₹10 lakh from Bhardwaj’s mother-in-law, Dr Urmila Pandey. Her mother-in-law is a doctoral student and former professor who had to give up her professional career due to family obligations. But she kept the spirit of financial independence and ambition alive in her daughters and daughter-in-law.

The first commercial batch of TeaFit was launched in March 2021. Bharadwaj had signed up with national retail chains before going into production. Shortly after launch, a second lockdown was imposed in India. Fearless, Bharadwaj
entered into a partnership with e-commerce giant Amazon.

“When we got the product in stores, the second lockdown started. Before the product could even reach the customers, the doors were closed,” Bharadwaj shared in a video with Amazon.

In FY22, TeaFit made a profit of ₹ 78,000 from sales worth ₹ 15.5 lakh, excluding advertising spend. The startup forecasts it will end FY23 with revenue of ₹45-₹55 lakh, based on July, August and September sales.

“Over the past 12 months on successive batches, all my fears have come true. Bottles came out distorted, filters clogged, whole batches were thrown away, labels didn’t fit, long power cuts, too much brewing you name it. But you know what? We passed them all and have consistently produced world-class beverages batch after batch,” Bharadwaj said a year after TeaFit started, in
an old LinkedIn post.

TeaFit has served more than 20,000 customers through online and offline channels. No less than 35% of the turnover comes from online channels, while the remaining 65% comes from offline channels.

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