Growers are learning they can skip a few links in the traditional supply chain to deliver fresher tea, a development accelerated by venture capital. Once or twice a year TechCrunch, the technology blog headquartered near San Francisco, reports on Silicon Valley investments in tea. The latest is a $1.4 million Series A round in Vahdam Teas, a 2 1/2-year-old Indian “tea-commerce” site selling specialty teas via its website and Amazon. The money is drawn from funds Fireside Ventures, Mumbai Angels, the Singapore Angel Network and private capital. The company previously raised $500,000 in January. It is helpful to remember that in Mumbai a $1.4 million investment equals 90 million rupees, which buys a lot of tea and the labor needed to market, track and ship tea. Average per capita income ranges from $5 per day at the tea gardens to $50 per day in the cities. As TechCrunch puts it: “Backed by some of India’s most eminent angel investors, Vahdam Teas is among the world’s first vertically integrated online-first tea brands.” The company has 150,000 registered customers and claims that 45 percent of the company’s buyers return for a repeat purchase every four months. Rival Teabox, also backed by venture capital from both the U.S. and India, operates a subscription tea business also designed to deliver garden fresh tea. Retailers in the 100 countries served by these companies should take heed. These specialty teas move quickly from pluck to packet, often in less than a week with air freight delivery hours from major U.S. and European cities. Most sales are via the company website but in the U.S. Amazon helps Vahdam sprint the final mile to a discerning customer’s doorstep. Bala Sarda, CEO of Vahdam Teas is not exaggerating when he says he can cut up to nine months and three weeks from typical delivery dates. He told TechCrunch the supply chain for the last 200 years requires three to four months to pluck and export. “Teas are then handled by multiple middle men, by the time the consumer gets to have tea it is 10 months onward,” he said. The argument that fresh teas are better tasting is compelling. While not strictly true―considering the many varieties of wulong and puer and teas that improve with age―many first-flush and lightly processed teas have a flavor profile that resembles fresh produce. In Russia for example, teas plucked along the Black Sea tea-growing region near Sochi are processed late in the day, packaged evenings and delivered to grocery stores and markets before day break. “Unlike your everyday cup, Vahdam Teas do not travel in containers for months before being packaged and sold. All teas are packed and shipped to Amazon warehouses in the U.S. direct from source in India,” according to the company. A 2017 English breakfast sells for $1.56 per ounce in 16-ounce packages and an organic second flush Darjeeling from this year’s troubled harvest is listed at $17.95 for 9 ounces. Sarda, 26, points out that “by cutting out all middlemen, we are also able to retain all earnings in the region where teas are grown by millions of passionate tea workers, a process which helps every farmer get a better price.” Cutting these costs also makes it practical to finance cold-storage logistics and subsidize the cost of air freight, which falls appreciably as volume increases. "We believe to retain the freshness and flavor of tea, we need to invest in this," he says. Shipments are vacuum packed at source, display the month the tea was plucked and are available both in tea bags and loose leaf. A sampler offering 10 teas (an estimated 50 servings) is listed at $19.95 on Amazon.
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