There is a sound that is becoming familiar across North India’s malls and high streets. The hiss of a milk steamer, the clink of a takeaway cup, a queue of college students waiting for their cold coffee. First Coffee is turning that sound into a business, and global investors are paying attention.
Indian speciality coffee chain First Coffee has raised $1.3 million in a pre-Series A funding round as it prepares to expand its store network and enter Tier-2 cities. The round was led by Japanese venture capital firm DG Daiwa Ventures (DGDV), with participation from existing investor BEENEXT, Sanjay Kapoor, Shashank Bhagat and other angel investors.
The startup disclosed details of the $1.3 million round on 19 August. DGDV had previously announced on 5 February that it had invested in First Coffee’s pre-Series A round alongside BEENEXT. The latest investment takes First Coffee’s total funding to $2.5 million.
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From 25 stores to Tier-2 cities
First Coffee said the raised funding will be used to accelerate store expansion, strengthen its corporate team, increase marketing activity and develop new products. The startup has grown to 25 stores across Delhi, Punjab and Haryana since its previous funding round in 2024. It now plans to expand beyond its existing urban markets and establish a presence in Tier-2 cities.
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Founded by Sohrab Sitaram and Shiv Dhawan, First Coffee operates as a grab-and-go speciality coffee business, combining smaller retail formats with a focus on convenience and design. Younger customers, particularly Gen Z, form an important part of its base, with cold coffee-based drinks and matcha among its key offerings.
Indian-grown, sustainable coffee
First Coffee sources 100% of its coffee from Harley Estate in Chikmagalur, Karnataka, using single-origin Arabica beans from selected micro-lots. The coffee is produced using sustainable farming practices, including shade-grown cultivation, water-efficient processing and biodiversity-friendly methods.
Makoto Ibi, head of global investment at DGDV, said the firm is glad to partner with First Coffee and fuel their ambition to change coffee culture in India. BEENEXT partner Anirudh Garg pointed to Sitaram’s previous experience scaling Keventers as an important factor in the startup’s early growth.
What lies ahead
Dhawan said First Coffee is placing greater emphasis on smaller-format outlets as it refines its expansion strategy, and expects India’s out-of-home coffee market to grow significantly over the next decade. Sitaram said the funding will support the ambition to develop from a North India base into a national brand.
India’s wider coffee market was valued at $552.9 million in 2023 and is projected to reach about $1.23 billion by 2032, according to research firm Custom Market Insights, which forecasts a compound annual growth rate of 9.87%. With Indian-grown speciality beans, compact stores and a Gen Z following, First Coffee is positioning itself right in the middle of that growth curve.