Tea Drops “Bath Bombs for Tea” Raise $5 Million in Series A Funding

Tea Drops, a California-based start-up, raised $5 million in a Series A funding round led by BrandProject. The company offers consumers bagless and dissolvable tea blends that eliminate traditional tea bags and reduce waste.

With the help of investors Siddhi Capital — which is best known for backing Beyond Meat and Magic Spoon — AF Ventures, Cue Ball Capital and Halogen Ventures, Tea Drops will expand their reach and distribution and build a stronger online presence and develop their operational strategies.

After this round of funding led by BrandProject, Tea Drops will have a total funding of $8.4 million. Tea Drops will be able to grow its direct-to-consumer (DTC) model into an omnichannel business. The company has been named one of the top 15 fastest DTC brands on Shopify with a 350 percent year-over-year growth. Tea Drops is on track to manufacture 10 million Tea Drops in 2021.

“We are thrilled to continue pushing the boundaries of tea innovation and further our mission as a self-care first experiential brand. With this new round of capital, we’re bringing on an incredible first-class team of e-commerce and operational strategists in both BrandProject and Siddhi Capital. We are so grateful for the new partnerships and the continued support from our existing partners. Together, we are modernizing a sleepy category and making tea accessible and fun for all,” said Tea Drops founder & CEO Sashee Chandran in a press release email sent to Xtalks.

According to the press release, tea is the most consumed beverage globally after water and there has been little innovation in this field. Chandran said that growing up with a Chinese mother and Sri Lankan father, tea was a staple in her home and her desire to sip high-quality tea that is convenient is what inspired her. Additionally, she was looking for an environmentally friendly product that eliminates the waste and taste of tea bags, along with the mess and stress of loose-leaf tea.

Some tea bags are bad for the environment because they are made of nanoplastics, glue, bleaches and other chemicals that are consumed and then thrown out. According to a study from McGill University, one cup of tea made from a gourmet tea bag (usually composed of PET or nylon) has 11.6 billion microplastic and 3.1 billion nanoplastic particles.

Tea Drops are committed to the environment by making sure no tea is wasted. Each drop is made of ground and organic tea, raw sugar and spices which eliminate the use of tea bags, sugar and sweetener packets. The drops are individually wrapped for on-the-go convenience, but the packaging is 100 percent recyclable. Similarly, their cardboard tea boxes are 100 percent biodegradable and compostable. For their products that come in wooden boxes, the company says this packaging is multi-purpose, which provides consumers with the ability to use their wooden boxes for other uses such as decorative pieces, giving the packaging a second life.

She calls her patented product “bath bombs for tea” that dissolve in your cup. All that is required is to drop the pressed organic and ground leaf teas into the water and then stir the cup before enjoying the beverage.

The company is run entirely by a team of women that are modernizing ancient cultural and ritual practices. The company launched in 2015 and since then, they have built an online community of over 200 thousand people that include fans such as Chrissy Teigen, Oprah Winfrey and Tory Burch.

Tea Drops is also a brand that gives back to the community. They work in partnership with the Thirst Project, where they have built four water wells and donated water to support over 140,000 individuals. “Without the essential element of water, one is stripped of opportunity and also a good cup of tea,” says Tea Drops’ website.

Other than the classic Tea Drop bombs, they also have unsweetened teardrop-shaped tea tablets and a line of boba bubble tea used in the same way. Additionally, the company provides tea lattes of fan-favorite drinks such as the golden latte turmeric with coconut milk, chai tea latte, matcha latte and more.

Tea Drops also introduced a monthly subscription option for tea lovers. The company recently closed a $54 million funding round that will further the company’s online business by enhancing the subscription component.

In an interview with Forbes, BrandProject’s partner, Hayden Williams, said that while the subscription model doesn’t work for all brands, it’s an ideal way for a tea business to retain customers. Williams added that “tea is not just a habit; it’s a tradition that so many people have, and it brings friends and families together to enjoy, which makes it perfect for subscription.