Nitin Saluja: Host to the Indian Tea Party
Saluja recounts his early fascination with tea-drinking as nothing short of a classic TV advert: "As a child, I learnt how to brew tea from my mom and soon became the designated tea-maker at my house."
In India, "chai wala" is a versatile cultural trope that lends itself to both classist pejoratives as well as self-styled markers of humility in the country's cinema, politics and ordinary life. At its core lies an image crystallised over decades: a roadside 'tapri' or shack, conical glasses (alternatively, clay cups or 'kulhad'), aluminium kettles, used tea powder suspiciously lying around, and an assortment of other flavour-packed ingredients such as ginger, cardamom, clove and so on.
A modern-day tea seller, Nitin Saluja set out in 2012 to transform this years-old visual by founding chai-cafe chain Chaayos. In July 2022, the startup inaugurated its 200th cafe in Bangalore: much like its counterparts in other metros, the tea shop offers aesthetic interiors, 80,000 chai combinations, an AI-driven personalised guest experience, repeat-visit incentives, an eclectic snacks portfolio, and order deliveries in heat-retaining eco-friendly kettles.
These facilities form just one percent of the larger vision that drives Saluja. "Chaayos is not just a café that serves tea. It is building the contemporary 'chai culture' of India, which can no longer be limited to drinking tea at home or on the roadside," he says. Ask him to paint a picture of that culture 20 years from now and he will tell you that most people will have forgotten how to make tea by themselves, given their frequent excursions to nearby Chaayos cafes. At INR 129 for 100 ml of tea in 2023, one might wonder about the possibility of proselytizing a population of thrifty tea addicts. Nevertheless, dreams aren't called grand for no reason.
Tea Drinker to Tea Seller
Saluja recounts his early fascination with tea-drinking as nothing short of a classic TV advert: "As a child, I learnt how to brew tea from my mom and soon became the designated tea-maker at my house." It was his stint at IIT Bombay as an engineering graduate, however, that enabled him to transmute nostalgia into commerce. According to analytics firm Tracxn Technologies, 73 of India's 100 unicorns have at least one founder from one of the country's 23 IITs. Studying amongst such aspiring entrepreneurs, Saluja learnt to envision business and technology as natural allies, a philosophy that he abides by till date. "Today, we spend about 20 per cent of our total HQ budget on engineering, hardware and technology products at Chaayos," he explains.
Between 2005 and 2012, Saluja founded his maiden business venture, ThinkLabs, and later worked as a consultant with Opera Solutions in the US, all the while amassing the requisite experience, capital and risk appetite to launch his dream project, Chaayos. "The conviction to quit my job was always there, but in 2012 everything aligned. Along came Raghav Verma (co-founder), seven months into Chaayos, and we have thankfully only grown stronger since then," he says. Splitting his savings at the time—INR 25 lakh—into two equal parts, Saluja used one half to open the first café and reserved the other for personal sustenance. While the uncertainties surrounding his new business naturally drew in disapproval from some worried family members, wife Yosha's encouragement never wavered. "We were also expecting our daughter together, which alone says a lot about the emotional support I received from the quarters I needed it the most," he recalls.
Running Chaayos: Hiccups and Triumphs
Much like any other nascent business, Chaayos' initial challenges spanned product-market fit (PMF), capital and people. With regards to fundraising in particular, Saluja recounts meeting over 50 investors in the span of just two months in 2016, many of whom, he realized in hindsight, were irrelevant to his business and naturally declined his investment pitches. Despite these initial rejections, Chaayos has managed to raise around $85.5 million over eight rounds till date from reputed names such as Tiger Global, Alpha Wave Ventures, Elevation Capital and Think Investments, among others.
Saluja recalls another early setback: "We had just opened our second café in Galleria Market in Gurgaon. Within two months of opening that unit, a PSU bank handed out a letter to us to vacate the shop within 15 days. Apparently our landlord had mortgaged that property and failed to repay the bank, and as a result of the proceedings, the bank moved to take possession of that unit. For a young brand with no backup capital, it was a major blow. Nonetheless, we took a bold call to move to the ground floor of Galleria market. While it was a rental we could not afford at that point but the promising prospects of that location allowed us to take a leap of faith. And within a month, that store became a huge success and the talk of the market."
Over the years, Chaayos has grown in scale and stature, and so have the stakes of building a beloved brand in India, with customers increasingly expecting socio-political sensitivity from businesses, especially new-age ones. Much like contemporary entrepreneurs, Saluja too has struggled navigating these challenges and faced the consumers' ire on many occasions: Chaayos reportedly 'liked' Islamophobic tweets, ignored a differently-abled customer, used facial recognition tech without consumer consent and so on. According to him, conventional Indian education, perhaps due to its focus on the hard sciences, has not prepared founders for understanding the current socio-political landscape, both local and global.
"We entrepreneurs are stumbling, learning and evolving, all on our own, in the face of this changing and ever-increasing socio-political sensitivity. Staying on the right side of history has never been more difficult because businesses are expected to operate with robotic precision, all the while maintaining human-like sensitivity. In all such matters, Chaayos' intent has been to do right by its customers without fail. We respect people of all faiths, genders and beliefs equally. Yes, we may have faltered at times, but we are quick to learn and fix erros asap," he explains.
In the end, for Saluja, the many difficulties involved in running a business pale in comparison to the sense of responsibility he feels for his 2500 employees and over a million customers every month. But above all, it is the larger dream—revolutionizing the country's popular chai culture and building a brand for generations to come—that keeps him going no matter the challenge.
"Chaayos is where my heart and mind are. Our annual strategy meet is called Plan A not because we don't have a plan for transactional contingencies in place but because the long-term Chaayos vision is non-negotiable," he claims.
Listen to the full interview on Entrepreneur India's Spotify channel, Audio Shots.
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A new series by Entrepreneur India that aims to unpack the inner workings of the Indian startup ecosystem by following the intertwined personal and professional journeys of those who people this world. Our aim? To piece together the 'real' success story of how a startup is built from scratch.