Third Wave has only 1 year of runway left, with 70% of it's outlets being loss making 🤯
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When you compete to serve the top 1% of India, obviously it will end up in losses
Especially the pretentious 1% who secretly in love with chai.
😁
Sad that these companies don't prioritize profitability first than growth. This model of growth at all costs is now coming to bite many startups in their ass
These businesses are not meant to be profitable. They were started to raise funds and founders made a ton of money. So the business was successful.
When they prioritise profit over growth people tag them as 'lala company' ig it's about execution irrespective of whatever be the outside noise.
Building consumer business is hard in India. Another reason I think is expanding quickly. Occupancy rates are low, average revenue per seat is average, operating expenses is high due to high rent, fancy interior and staff salaries.
Not really! If that were the case you wouldn’t see SRK, Ajay Devgan, Akshay Kumar and Tiger promoting Vimal. The problem with third wave is they thought the 1% is ready to pay unrealistic amount for “experience”. End of the day, even the 1% wants value for their money and will only spend on stuff that is super exclusive.
Yes. 1% would pay for convenience, but yes experience not so much, when it really isn't that exclusive and there are tons of good alternatives available.
Only two models work in India Massy or Classy. Anything in the middle will get crushed. Either you sell Vimal Gutkha or run an invite only night club.
This is despite the quality going downhill at many outlets.
Why can’t people focus on volume? That is where the real india lies. People will spend 20 rs daily at a chaiwaala instead of 200 at one.
Because most volume plays like that don't scale.
There's no brand in selling 10/20 rs chai. A local chaiwala will just trump your franchise.
Know the founders. Never felt they were the ultra fast growth kind. They have a new CEO who is running the show. Not surprised by this outcome.
Overpriced coffee in hipster cafes was a ZIRP. Like overpaid designers ans product managers.