How This Founder Built Her Zero-Sugar Beverage Brand By Learning From Others’ Mistakes

After finding out that her body had started to resist insulin in 2015, Jyoti Bhardwaj, now the founder of D2C beverage brand TeaFit, went on alert mode to defy what was impending — Diabetes. 

As she prepared herself to alter her fate, embracing a healthy lifestyle, she found that the outside world was full of unhealthy food options. Not to mention, not even beverages (soft drinks, energy drinks and juices) could be trusted because of their high sugar content.  

However, back then, Bhardwaj wasn’t the only one looking at this challenge and thinking of ways to solve it by making available healthier, natural beverage options. As she studied the market, she discovered that several beverage brands were already in the market to solve the issue at hand, but were only struggling to make their both ends meet due to low customer footfall.

While she aspired to float a similar venture, she couldn’t gather the courage, looking at the market conditions, as many brands, at the time, were either failing to establish their presence or getting acquired by larger companies.

A case in point is of FMCG firm Food Empire Group, which acquired an 80% stake in Positive Food Ventures’ iced tea brand, Brewhouse. Startups such as Teavibe and Jadeforest, too, struggled but eventually sustained.

With little knowledge, Bhardwaj waited and observed the industry until 2019 before she finally went all in to disrupt the market with her zero-sugar bottled teas — a concept that she took inspiration from Japan.

Despite the fire in her belly, she could do only little to realise her aspirations, until she finally saw Raw Pressery’s rise to fame, as the pandemic “really flipped the Indian health scenario”.

This nudged Bhardwaj to finally walk the talk in 2021, paving the way for TeaFit, a health-focussed sugar-free beverage brand. As per the founder, the brand’s product portfolio includes iced teas and tea premixes brewed from tea leaves sourced from Assam, Arunachal Pradesh, and Kerala.

With a current user base of over 1.25 Lakh customers, the startup reaches customers across India through Zepto and Blinkit. Its products are also available at all Nature’s Basket locations, as well as many 7-Eleven, Spencer’s, and pharmacy stores.

The startup’s claim to fame was its appearance on Shark Tank India last year. Prior to the show, the founder said, it earned INR 15 Lakh in FY22. However, following its appearance on the show, the startup’s revenue surged to more than INR 90 Lakh in FY23. The founder claims to have earned revenues to the tune of INR 3.4 Cr, which she anticipates to double by the end of the ongoing fiscal. 

“Before Shark Tank, we weren’t doing well at all. I had chosen a very niche positioning, and our distribution was limited to Nature’s Basket. If we had launched a more mainstream product like a mango drink, it might have performed better. The product I chose wasn’t for everyone. Shark Tank opened many doors for us—quick commerce happened because of it, we received numerous messages, and our entire export business took off because of this exposure,” said Bhardwaj.

TeaFit’s Distribution Dilemma

Bhardwaj launched the brand with an initial batch of 2,000 bottles, making them available at seven Nature’s Basket stores in Mumbai. She invested most of the budget into product development and Ayurvedic formulations, leaving behind little money for further retail expansion. Moreover, she was sceptical about online sales for beverages due to low order volumes and high shipping costs, so she decided to keep the brand restricted to Nature’s Basket stores in initial months. 

While the founder thought that product development and having the product on the shelves of Nature’s Basket was enough, she soon realised that there were many miles yet to be walked. 

The realisation struck when the brand could only sell 6-8 Teafit bottles during the second wave in 2021. She knew it was time to pivot and shifted her focus to online sales through her website. The startup also entered pharmacy stores but refrained form investing heavily offline. In 2023, the startup launched itself on quick commerce platforms, including Amazon, BigBasket, 7-Eleven, Zepto, and Blinkit. Currently, 30% of its sales comes from offline channels, while 70% from online channels.

In addition to focussing on the startup’s distribution strategy, Bhardwaj made several iterations of products.

The biggest challenge for her was to create a zero-sugar beverage that was not bitter and suited Indian taste preferences. Finally, after 130 iterations to suppress the bitterness in the product, she unveiled the first range of unsweetened bottled teas under the TeaFit brand in March 2021.

With a total of 11 SKUs currently in its portfolio, the brand offers ready-to-drink products such as lemon tea, peach green tea, and barley tea. The rest are pre-mix sachets, including ginger, matcha latte, and saffron tea—all crafted with the brand’s own tea extracts. All its products are zero sugar, with no sweeteners or fillers. 

TeaFits’ Path Forward

Going ahead, the startup plans to focus on offline expansion in Mumbai, as the founder believes there is significant growth potential in growing in one state first before expanding to others. Currently, 23% of the startup’s sales happens in Mumbai.

The brand is aiming for a sustainable growth strategy rather than rapid nationwide expansion. In the coming years, it will focus on growing its distribution network and deepening its presence in quick commerce, including any new emerging channels. However, Bhardwaj is in no hurry and prefers to savour success as it unfolds. 

Meanwhile, India is seeing an influx of D2C startups like Vahdam, Chaayos, ChaiSutta, Tea Trunk, and Teabox bringing all sorts of innovations to this category, offering everything from pre-mixes and flavoured teas to herbal and unsweetened options. It is on the back of this that the country’s tea market is projected to become a $14.7 Bn market opportunity by 2032. 

Imperative to highlight that the market is flush with opportunities and incumbents like Bengaluru-based Chai Point have even started preparing for an IPO. Additionally, VCs continue to enjoy a sip of the Indian tea market.

[Edited by Shishir Parasher]