Bean There, Done That: Sleepy Owl’s Founding Trio

Sleepy Owl was founded in 2016 by three friends: Ajai Thandi, Arman Sood, and Ashwajeet Singh. Ajai and Ashwajeet were childhood friends, while Arman and Ashwajeet met during their time at Jindal Global Law School. Ajai studied Economics at the University of Southern California and later worked as an investment banker at JP Morgan in New York. (Ajai Thandi) (Arman Sood)

Arman and Ashwajeet both pursued law degrees at Jindal Global Law School, graduating in 2015. During their college years, Arman and Ashwajeet co-founded an e-commerce venture that sold bar accessories imported from China. Although this venture reached a break-even point, they eventually decided to liquidate their stock and move on to new opportunities. (Ashwajeet Singh)

After graduation, Arman joined Embibe, a Mumbai-based startup, where he worked in the PR and Marketing department for about a year and a half. Ashwajeet joined Korra Jeans, handling brand marketing. Despite their corporate roles, both remained passionate about entrepreneurship and coffee. Ajai, working long hours in New York, developed a deep appreciation for the coffee culture in the U.S. He noticed the convenience and quality of cold brew coffee, which was not readily available in India.

Recognizing a gap in the Indian market for convenient, high-quality coffee, the trio decided to introduce cold brew coffee to Indian consumers. They believed that offering a product combining quality and convenience would resonate with the evolving tastes of Indian consumers. In 2016, they launched Sleepy Owl from a two-bedroom apartment in Dwarka, Delhi. Their initial product was a bag-in-box format of cold brew coffee, designed for easy consumption at home or in the office.

The founders faced challenges in educating a predominantly tea-drinking nation about cold brew coffee. They utilized social media and digital platforms to reach their target audience, explaining the benefits of their less bitter, less acidic coffee. Their innovative packaging and commitment to quality helped them stand out in a competitive market. Over time, Sleepy Owl expanded its product line to include hot brew bags, ready-to-drink cold brew bottles, and ground coffee, catering to a wide range of consumer preferences. Today, Sleepy Owl is a prominent player in India’s coffee industry, known for its innovative products and commitment to delivering high-quality coffee experiences. 

A Latte Potential: The Growing Buzz Around Instant Coffee

The global instant coffee market has experienced significant growth in recent years, driven by consumers’ increasing demand for convenience and quick preparation methods. In 2024, the market was valued at approximately USD 31.45 billion and is projected to reach USD 43.57 billion by 2032, exhibiting a compound annual growth rate (CAGR) of about 4.2% during this period. (Business Research Insights)

In India, the instant coffee market is expanding rapidly, reflecting changing consumer preferences and a growing coffee culture. In 2024, the market size was estimated at USD 443.0 million and is expected to reach USD 755.9 million by 2033, with a CAGR of 5.7% from 2025 to 2033. (IMARC)

Several factors contribute to this growth. Urbanization and busy lifestyles have increased the demand for convenient beverage options, making instant coffee a popular choice among consumers seeking quick and easy preparation. Additionally, the rise of café culture and the influence of Western lifestyles have introduced coffee to a broader audience in traditionally tea-drinking regions. Product innovations, such as the introduction of flavored instant coffees and premium blends, have also attracted new consumers and encouraged existing ones to try different varieties. The expansion of distribution channels, including online platforms and supermarkets, has made instant coffee more accessible to a wider population.

Despite its growth, the instant coffee market faces challenges. Health-conscious consumers may perceive instant coffee as less healthy compared to freshly brewed options due to concerns about additives and processing methods. Additionally, the increasing popularity of specialty coffees and the emergence of artisanal coffee shops offer alternatives that compete with instant coffee products.

Nevertheless, the market’s positive trajectory indicates a sustained demand for instant coffee globally and in India. Manufacturers and brands that focus on quality, innovation, and adapting to consumer preferences are well-positioned to capitalize on the opportunities within this expanding market.

Groundbreaking Brews: What Makes Sleepy Owl So Special

Sleepy Owl’s mission centers on providing “real good coffee to everyone, without complex equipment or brewing techniques,” ensuring that premium coffee is simple to obtain, prepare, and enjoy anytime, anywhere.

The company’s vision emphasizes approachability and convenience, aiming to demystify coffee brewing for the average consumer. By offering products that require minimal preparation, Sleepy Owl seeks to integrate quality coffee seamlessly into daily life, catering to both novices and seasoned coffee drinkers. (About Sleepy Owl)

Problems They Solve

Sleepy Owl addresses several challenges in the Indian coffee market. Traditionally, many consumers perceived coffee brewing as complicated, often necessitating specialized equipment and knowledge. Sleepy Owl simplifies this process with innovative products like their Hot Brew Bags and Cold Brew Packs, which function similarly to tea bags, allowing users to brew coffee effortlessly without any equipment. This innovation bridges the knowledge gap and makes real coffee accessible to a broader audience.

Additionally, Sleepy Owl tackles the issue of limited availability of quality coffee in non-urban areas. By expanding their distribution to over 2,200 general and modern retail stores across metros and Tier-I cities, including Delhi-NCR, Mumbai, Pune, Indore, Bhopal, Chandigarh, and Jammu, they ensure that more consumers have access to premium coffee products.

Business Model

Sleepy Owl operates on a multi-channel business model that combines direct-to-consumer (D2C) sales with partnerships in both online and offline retail spaces. Their D2C platform serves as a brand-building channel, fostering direct relationships with customers and offering insights into consumer preferences. Approximately 60% of their online sales come from repeat purchases, highlighting strong customer loyalty.

In addition to their online presence, Sleepy Owl collaborates with leading online marketplaces and quick commerce platforms to reach a wider audience. This strategy caters to the fast-paced lifestyles of their target demographic, ensuring swift delivery and convenience. Offline, they have established a significant presence in retail stores, recognizing the importance of physical availability in influencing purchase decisions. 

Brew It Yourself: Sleepy Owl’s Blend of Innovation and Convenience

Sleepy Owl has diversified its product offerings to cater to a wide range of coffee enthusiasts, ensuring convenience and quality across all their products.

Cold Brew Packs

Sleepy Owl’s Cold Brew Packs are designed for simplicity and flavor. Each pack contains coarse ground 100% Arabica coffee sealed in a filter bag. To prepare, immerse the bag in cold water and let it steep for 12-15 hours, resulting in a smooth, less acidic coffee concentrate. This method requires no specialized equipment, making it accessible to all coffee lovers. Flavors include Original, French Vanilla, and Hazelnut, catering to diverse palates. (Cold Brew)

Hot Brew Bags

For those who prefer hot coffee, Sleepy Owl offers Hot Brew Bags. These single-serve bags function like tea bags, containing freshly ground coffee that can be brewed directly in a cup of hot water. This design ensures minimal preparation time and no need for equipment, appealing to consumers seeking quick yet high-quality coffee. Flavors such as Original, Dark Roast, Cinnamon, French Vanilla, and Hazelnut provide a range of options to suit individual tastes.

Premium Instant Coffee

Recognizing the demand for instant solutions without compromising on taste, Sleepy Owl introduced its Premium Instant Coffee line. Utilizing freeze-dried technology, this coffee preserves the rich flavor of 100% Arabica beans, offering a superior alternative to conventional instant coffees. Available in flavors like Original, French Vanilla, and Hazelnut, these products contain no artificial additives, ensuring a natural and satisfying coffee experience. (Instant Coffee)

Ready-to-Drink (RTD) Cold Brew Bottles

For ultimate convenience, Sleepy Owl’s Ready-to-Drink Cold Brew Bottles provide a grab-and-go option for coffee enthusiasts. These bottled beverages deliver the smoothness of cold brew coffee without any preparation, catering to busy individuals seeking quality coffee on the move. The RTD range includes flavors such as Classic, Mocha, and Salted Caramel, appealing to a wide spectrum of palates.

Ground Coffee

Catering to traditionalists who prefer brewing their coffee, Sleepy Owl offers packs of freshly roasted and ground 100% Arabica coffee. Sourced from select Indian coffee estates, these grounds are suitable for various brewing methods, including French press, pour-over, and drip machines. The ground coffee is available in different roast profiles, such as Medium Roast and Dark Roast, allowing consumers to choose according to their flavor preferences.

Merchandise and Accessories

Beyond coffee products, Sleepy Owl provides a selection of merchandise and brewing accessories to enhance the coffee experience. This includes items like branded mugs, tumblers, and brewing equipment, enabling customers to enjoy their Sleepy Owl coffee with complementary tools.

Sleepy Owl’s commitment to innovation and quality is evident across its product range. By focusing on convenience without sacrificing flavor, they have made premium coffee accessible to a broad audience, catering to both novice drinkers and seasoned aficionados. Their diverse offerings ensure that every consumer can find a product that aligns with their taste and lifestyle, solidifying Sleepy Owl’s position as a leader in India’s evolving coffee culture.

Blends That Transcend: Coffee That Wins Hearts (and Awards)

Launched in 2016 from a two-bedroom apartment in Delhi, the brand pioneered cold brew coffee in a nation traditionally dominated by tea and instant coffee. This bold move positioned Sleepy Owl as a trailblazer in the Indian coffee scene. 

The company’s emphasis on convenience and quality has attracted a growing customer base. By 2020, Sleepy Owl had amassed over 60,000 customers and expanded its presence to more than 1,000 retail outlets across major cities like Delhi-NCR and Mumbai. Sleepy Owl’s innovative approach has garnered industry recognition. In 2020, the company’s founders were featured in Forbes India’s “30 Under 30” list. (Forbes India)

In April 2022, Sleepy Owl partnered with NOTO, a low-calorie ice cream brand, to introduce a limited edition ‘Chocolate Coffee Fudgsicle.’ This product combined NOTO’s low-calorie ice cream with Sleepy Owl’s premium instant coffee, resulting in a unique frozen treat. Additionally, Sleepy Owl collaborated with Jimmy’s, a brand known for its non-alcoholic mixers, to launch an Espresso Martini cocktail mixer. This partnership allowed consumers to create bar-quality espresso martinis at home.

Bean Counters Rejoice: Sleepy Owl’s Financial Journey

Sleepy Owl has raised a total of $10.7 million in funding across four rounds. The company secured its first seed funding in January 2018, raising $1.3 million with a pre-money valuation of $1.1 million. This round was backed by institutional investor DSG Consumer Partners and facilitated by Trilegal. The funds helped Sleepy Owl establish its foundation in the growing coffee market. (Tracxn)

In October 2019, Sleepy Owl raised an additional $1.1 million in another seed round. With a pre-money valuation of $5.5 million and post-money valuation of $6.7 million, this round attracted institutional investors like Rukam Capital and DSG Consumer Partners, alongside corporate participation from Wellfound. At the time, the company’s trailing twelve-month (TTM) revenue was $597,000, achieving a revenue multiple of 9.4x.

The company’s first Series A funding round in June 2021 raised $6.5 million. With a pre-money valuation of $21.6 million and post-money valuation of $28.1 million, this round brought in institutional investors such as Rukam Capital, DSG Consumer Partners, and QRG Investments and Holdings. Corporate backers included DS Group, Gauri Khan, and Koenig Solutions, with angel investors like Aamir Khan and Pramod Bhasin also participating. Dexter Capital Advisors facilitated the funding, which supported Sleepy Owl’s rapid expansion and operational growth. The company reported TTM revenue of $1.5 million, with an impressive revenue multiple of 14.7x.

In October 2023, Sleepy Owl raised $1.8 million in a follow-up Series A round, achieving a pre-money valuation of $14.2 million and a post-money valuation of $16.0 million. Institutional investors DSG Consumer Partners and Rukam Capital led the round, supported by corporate backers such as DS Group and Gauri Khan. The company’s TTM revenue stood at $3.1 million, achieving a revenue multiple of 4.7x.

Sleepy Owl’s revenue has grown consistently. In FY 2017-18, the company earned ₹0.5 crore, which increased to ₹2.6 crore by FY 2018-19. By FY 2022-23, the revenue reached ₹29.1 crore, though it slightly dipped to ₹22.2 crore in FY 2023-24, reflecting the challenges of scaling operations. 

A Recap: Sleepy Owl’s Remarkable Journey

Sleepy Owl has transformed how India drinks coffee. The startup brings convenience and quality together through innovative coffee solutions. From Cold Brew Packs that simplify brewing to Ready-to-Drink bottles for on-the-go coffee lovers, Sleepy Owl caters to everyone. Their products, made with 100% Arabica beans, stand out for their taste, ease of use, and accessibility.

Founded in 2016, the company has grown into a trusted name in India’s coffee market. With a strong focus on innovation, they’ve introduced products like Hot Brew Bags and Premium Instant Coffee. These offerings make specialty coffee easy for anyone, even without fancy equipment. Their Ready-to-Drink Cold Brew Bottles and fresh Ground Coffee add more variety, ensuring there’s something for every kind of coffee enthusiast.

Sleepy Owl’s dedication to accessibility is evident in its retail presence across over 2,200 outlets in cities like Delhi, Mumbai, and Pune. Their online sales and collaborations with partners like Jimmy’s and NOTO further expand their reach. By staying focused on customer needs, Sleepy Owl has become a trailblazer in India’s evolving coffee culture.

Have an idea? Don’t wait for the “right moment.” Start small and take your first step. Big successes often grow from small, consistent efforts. If you’re curious about more inspiring startups or business stories, check out other articles on Venture Kites.