abCoffee: Specialty coffee chain abCoffee raises $3.4 million funding led by Nexus Venture Partners

The Mumbai-based company plans to deploy the new capital to accelerate its supply chain and technology stack, aiming to increase the accessibility and speed of its affordable specialty coffee through its retail “grab-and-go” outlets.

“In India, we have grown up in a chai environment, predominantly in the west of India, and filter coffee in the south. The way it works is that you grab a chai, wait for three to seven minutes depending on how big a chat you want to have, and then leave. So, it’s not technically grab and go, but an Indianised version of that,” Abhijeet Anand, co-founder of AbCoffee, told ET.

The funding round is expected to triple the valuation of the coffee chain to about $15 million (about Rs 124 crore) in less than six months, ET had reported on Friday.

“We are focusing on supply chain optimisation, vertical integration and building up our technology stack to bring on-demand coffee at the lowest prices,” Anand said.

Founded in 2022, AbCoffee currently operates 49 outlets, primarily concentrated in cities such as Mumbai and New Delhi, with an average size of 120 square feet. It sources its coffee beans from farms in Chikmagalur, Karnataka.

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The delivery channel has proven successful for AbCoffee, unlike for other coffee firms, according to Anand, providing a higher value proposition compared to industry standards. “Delivery has helped in our pickup as well and made us more popular in our neighbourhoods,” he said.During favourable seasons like monsoon, marketplace sales account for 30-45% of total sales, he said.

Prior to this, Abcoffee raised $2 million in a seed funding round in September 2023, led by venture capital firm Tanglin Venture Partners.

The latest funding aligns with the emerging trend of technology-focused venture capital funds showing interest in consumer brands with a physical presence. ET reported on Friday that Nexus Venture Partners has extended a term sheet to lab-grown jewellery maker Aukera as well.

“AbCoffee’s commitment to making specialty coffee accessible to the masses resonated strongly with us,” said Suvir Sujan, managing director, Nexus Venture Partners. “Their innovative tech model, coupled with their focus on high-quality, ethically sourced beans and efficient brewing methods, allows them to offer premium coffee experiences at surprisingly affordable prices.”

The Mumbai-based company plans to deploy the new capital to accelerate its supply chain and technology stack, aiming to increase the accessibility and speed of its affordable specialty coffee through its retail “grab-and-go” outlets.

“In India, we have grown up in a chai environment, predominantly in the west of India, and filter coffee in the south. The way it works is that you grab a chai, wait for three to seven minutes depending on how big a chat you want to have, and then leave. So, it’s not technically grab and go, but an Indianised version of that,” Abhijeet Anand, co-founder of AbCoffee, told ET.

The funding round is expected to triple the valuation of the coffee chain to about $15 million (about Rs 124 crore) in less than six months, ET had reported on Friday.

“We are focusing on supply chain optimisation, vertical integration and building up our technology stack to bring on-demand coffee at the lowest prices,” Anand said.

Founded in 2022, AbCoffee currently operates 49 outlets, primarily concentrated in cities such as Mumbai and New Delhi, with an average size of 120 square feet. It sources its coffee beans from farms in Chikmagalur, Karnataka.

Discover the stories of your interest

The delivery channel has proven successful for AbCoffee, unlike for other coffee firms, according to Anand, providing a higher value proposition compared to industry standards. “Delivery has helped in our pickup as well and made us more popular in our neighbourhoods,” he said.During favourable seasons like monsoon, marketplace sales account for 30-45% of total sales, he said.

Prior to this, Abcoffee raised $2 million in a seed funding round in September 2023, led by venture capital firm Tanglin Venture Partners.

The latest funding aligns with the emerging trend of technology-focused venture capital funds showing interest in consumer brands with a physical presence. ET reported on Friday that Nexus Venture Partners has extended a term sheet to lab-grown jewellery maker Aukera as well.

“AbCoffee’s commitment to making specialty coffee accessible to the masses resonated strongly with us,” said Suvir Sujan, managing director, Nexus Venture Partners. “Their innovative tech model, coupled with their focus on high-quality, ethically sourced beans and efficient brewing methods, allows them to offer premium coffee experiences at surprisingly affordable prices.”