Third Wave Coffee is betting on a dessert menu, "Third Rush," to finally hit profitability after losing Rs 94 crore last fiscal year. This Hail Mary follows years of strategy pivots and a CEO change, all while no Indian coffee chain—not even Starbucks—has turned a profit. The company needs to boost average order value and customer retention, a challenge caffeine alone hasn't solved.
How We Got Here
Third Wave faced Rs 110 crore losses on Rs 240 crore revenue in FY24, with 70% of its cafes making no money. Former KFC India head Rajat Luthra took over as CEO and narrowed losses to Rs 94 crore in FY25 by standardizing menus.
The Numbers
- Third Rush will launch 200-odd dessert options, including Jim Jam tres leches and pineapple cake.
- The company plans to expand Third Rush to approximately 50 cafes by the end of the year.
- Third Wave has raised nearly Rs 665 crore ($70 million) across 10 funding rounds since its inception.
- Over 90% of Third Wave’s cafes are now Ebitda positive at the store level.
- Third Wave is in talks to raise a $100 million growth round from existing investors Westbridge Capital and Creagis.
What Happens Next
🇮🇳 Why This Matters for India
For cafe owners in cities like Pune and Hyderabad, Third Wave's dessert strategy offers a playbook to boost revenue beyond coffee's limited consumption.
The Take
Selling 200 desserts means competing with standalone bakeries and home chefs, a far tougher scale play than coffee. If Third Rush fails to deliver, Third Wave likely won't find another next act.
Source:
The Ken ↗