Arman Sood & Sleepy Owl Coffee: Brewing India's Next Big Coffee Brand 🦉
Meet Arman Sood, the Co-Founder behind Sleepy Owl Coffee, one of India's rapidly growing coffee brands that's changing how the country experiences its daily brew. From pioneering cold brew coffee in India to building a diverse portfolio of convenient, high-quality coffee products, Arman's journey is a fascinating look into modern entrepreneurship, D2C strategy, and the art of scaling a beloved brand. This dossier dives deep into his story, the evolution of Sleepy Owl, and their ambitious vision for the future.
Check out the video of the conversation here or read on for insights.
Early Life & The Seeds of Entrepreneurship 🌱
Growing up in Kolkata in a middle-class family, Arman witnessed the entrepreneurial spirit firsthand. His father, a businessman with varied ventures, demonstrated perseverance through hits and misses, while his mother built a successful teaching career from the ground up, tutoring hundreds of students.
"I've seen him persevere through that right? And of course you know along with his hits and misses my mom... she's had a very successful teaching career... having seen her you know, slog and work so hard. But but because but she's really passionate about it right?"
This environment fostered a sense of security and an appetite for risk. Though initially drawn to sports, playing football, cricket, and hockey near state level, academics eventually took precedence. After navigating the confusion of choosing a career path (even considering Merchant Navy until discovering his colour blindness), Arman pursued law, encouraged by his father.
He joined O. P. Jindal Global University for his BA.LLB (Hons.) in 2010, entering its second-ever batch. This nascent environment proved pivotal.
"I saw it as a land of opportunity... any sort of society or club was just forming... that that you know for me then it became Okay, let's take initiative to to do things to create things..."
The Entrepreneurial Spark: University Ventures ✨
At Jindal, Arman met Ashwajeet Singh, his future Sleepy Owl Co-Founder. While Arman focused on law, Ashwajeet, hailing from a business family, introduced him to the concept of entrepreneurship. Their first unofficial venture? Selling late-night snacks like anda bread and unique octopus sandwiches out of their dorm room to fill a campus need.
They then moved on to creating official university merchandise (hoodies, t-shirts) – designing, sourcing, taking orders (using SurveyMonkey!), and distributing, gaining valuable pocket money and foundational business experience.
Their most significant university venture was eShack (Sood & Singh Ventures), launched in October 2012. Inspired by American party culture and identifying a gap in the Indian market, they started an e-commerce site selling party accessories like beer pong tables, beer bongs, and unique T-shirts.
Investment: ₹10-12 lakhs (funded by parents)
Revenue: Approx. ₹9 lakhs (ultimately a loss)
Duration: Operated for nearly 3 years (Oct 2012 - June 2015)
Process: Sourced products via Alibaba, managed imports (with family help), set up a website, handled operations, marketing, PR, and logistics – all while being full-time law students.
"We learned then at that time was you know you have to be shameless while marketing your your idea and your products and you know we managed to create a lot of hype and and good pr around the fact that we were 19-20 year old law students running a party accessory business..."
Though eShack eventually shut down, the experience was invaluable. It solidified their passion for entrepreneurship over law and taught them crucial lessons about building a business from scratch, marketing, and even facing failure.
Post-Graduation & The Itch to Build 🚀
After graduating in 2015, Arman joined Embibe, an EdTech startup in Mumbai, as a Marketing & Communications Evangelist, gaining exposure to the startup ecosystem. Ashwajeet joined Korra Jeans, a fashion startup. Despite gaining experience, the desire to start their own venture persisted.
Ashwajeet proposed they team up again. Arman was initially hesitant ("We are a disaster together... we don't even have an idea"). But Ashwajeet quit his job and moved to Mumbai to brainstorm with Arman, who kept his job initially. They explored ideas in F&B and fitness, like meal planning and healthy condiments.
Around this time, Ashwajeet connected with Ajay Thandi, a childhood friend working at JPMorgan in New York who was looking to return to India and explore entrepreneurship. Ajay started validating ideas from the US perspective.
The Birth of Sleepy Owl 🦉☕
Ashwajeet's research led them to coffee. They realised the existing options for quality in-home coffee in India were limited or required effort (like using a French press). Researching global trends, they stumbled upon Cold Brew Coffee.
"At that point in time there wasn't a single company in India or a startup that was doing anything related to cold brew coffee."
Seeing the potential and validated by Ajay's insights from the US market ("it's blowing up"), the trio decided this was it. Arman quit his job at Embibe. Ajay moved back to India.
The Founding Team:
Arman Sood: Operations, Supply Chain, Packaging, Warehousing.
Ashwajeet Singh: E-commerce, Website, Design, Social Media, Photography, Brand Look & Feel.
Ajay Thandi: Finance, Business Development, Investor Relations, Team Building, Strategy.
Their first step? A trip to Chikmagalur, Karnataka – the heart of India's coffee region – in early 2016.
"We acknowledged to ourselves and to the people we're meeting that we know nothing and that we would like to learn... Hamme nahi pata aur ham naye hai (We don't know and we are new)."
They learned the intricacies of the coffee supply chain – from cherry to bean, roasting, grinding, sourcing, and the importance of 100% Arabica beans (less bitter, more flavourful, premium) for cold brew. They researched brewing techniques extensively online, especially on Reddit communities, and even reached out to global cold brew startups.
The Cold Brew Recipe Essentials:
Coffee: 100% Arabica beans, coarse ground (for slow extraction).
Water: High-quality, consistent water (initially Bisleri!). Room temperature or cold water.
Brewing Time: Overnight (12-21 hours).
Filtration: Crucial for removing grounds. They experimented and settled on unbleached Muslin cloth, custom-sized for their brewing buckets.
Launch, Pivot, and Early Traction 🚀
Setting up shop in Ashwajeet's empty family house in Dwarka, Delhi, they gave themselves a deadline: launch by March 15th, 2016, coinciding with Jindal's annual fest.
Initial Launch (March 2016): Set up a stall at their university fest.
Product: Black Cold Brew filled in 1-litre glass bottles.
Menu: Served 3 drinks: Smooth Black (₹150), Iced Coffee (Cold brew + Milk, ₹170), Vietnamese Coffee (Cold brew + Condensed Milk, ₹200).
Response: Positive validation, especially for the black cold brew.
The B2B Attempt (April 2016): Tried supplying the 1-litre bottles to restaurants. Failed quickly due to low offtake and lack of discovery. Sold only 1 litre out of a 6-litre Minimum Order Quantity (MOQ) in 30 days at the first restaurant.
The Pivot to D2C (April-June 2016): Realised B2B wasn't working and decided to sell directly to consumers online.
Challenge: Shipping 1-litre glass bottles wasn't feasible.
Solution: Discovered Bag-in-Box packaging (commonly used for wine) via research and Alibaba. Found suppliers in China for the bags (with taps) and a box manufacturer in West Delhi.
New Product: 1.5 Litre Bag-in-Box Cold Brew.
E-commerce Launch (June 14, 2016): Website went live with the single 1.5L Bag-in-Box SKU (₹600, making 10 cups @ ₹60/cup).
Focus: Delhi NCR only, due to the product needing refrigeration and having a limited shelf life outside it.
Logistics: Initially relied on couriers, but often the founders delivered orders themselves across NCR.
Marketing: Spammed everyone they knew, focused on online blogs and discovery platforms (like LBB, So Delhi). No significant ad spends initially.
Traction: Sold the initial order of 1000 units relatively quickly.
Scaling Up: Funding, Products & Team Growth 📈
First Office & Hires (Oct/Nov 2016): Moved out of the Dwarka house into their first office space in Shahpur Jat, Delhi (where their office remains, albeit in a different location). Hired their first two employees: a delivery person and a production assistant.
Early Revenue: Reached approx. ₹1-2 lakhs/month in late 2016. Winters were slow.
Digital Marketing Push (Feb/Mar 2017): Started spending on Facebook & Instagram ads, leading to increased orders and the need for more delivery riders.
Omnichannel Expansion (Mid-2017):
Targeted offline retail, starting with independent stores in areas identified via online order data (Hauz Khas, Defence Colony etc.). Reached 30-40 stores.
B2B (Restaurants/Cafes) also started picking up.
The ₹10 Lakh Challenge: An investment banker told them he'd only take their mandate if they hit ₹10 Lakhs/month revenue. They achieved this target by June 2017, driven by aggressive online/offline efforts within Delhi NCR. Revenue split was roughly: Online (majority), Retail, B2B.
Seed Funding (Feb 2018): Raised $500,000 (approx. ₹3.5 Crores) led by DSG Consumer Partners. This capital was earmarked for scaling the existing business and investing in new product development, particularly Ready-to-Drink (RTD) options.
Product Innovation 1 - Cold Brew Packs (Mid-2018):
Goal: Scale cold brew Pan-India, overcoming the limitations of the Bag-in-Box.
Product: Pre-portioned ground coffee (50g) in large filter bags ("Brew Packs"). Users add water, brew overnight.
Format: Dry product, easy to ship Pan-India. Opened up marketplaces like Amazon, BigBasket.
Pricing: Box of 5 Brew Packs (each makes 3 cups) for ₹500. Effective cost per cup reduced to ~₹33.
Impact: Scaled reach significantly. The original Bag-in-Box remains available in NCR for loyal customers.
Product Innovation 2 - Ready-to-Drink (RTD) Bottles (2019):
Goal: Enter the retail RTD coffee space dominated by large players.
Product: India's first RTD Cold Brew Coffee in 200ml glass bottles (₹100 MRP). Made with real milk, real coffee, low sugar, preservative-free. Milk-based variants were key for the Indian palate.
Manufacturing: Used a co-packer.
Distribution: Initially launched offline-only in Delhi NCR & Mumbai modern/general trade stores. Expanded online post-pandemic.
Strategy: Slow, steady, strategic retail expansion focusing on identifying the right stores and building demand.
Product Innovation 3 - Hot Brew Bags (Dec 2019):
Goal: Address customer demand for hot coffee, especially during winter, while maintaining the convenience USP.
Product: Ground coffee (10g) in single-serve teabag-like format. Users dip in hot water for 4-5 mins. India's first brand to execute this format at scale.
Execution: Challenging due to fitting 10g coffee vs 2-3g tea in standard bags, requiring machinery optimization.
Pricing: ~₹30 per cup.
Impact: Became a runaway hit, now contributing over 50% of the business.
Pre-Pandemic Turnover (FY 2019-20): Approx. ₹8-9 Crores.
Split: ~60% Online, 30% Offline Retail, 10% B2B/Other.
Funding Round (Pre-Pandemic): Raised an undisclosed round from Rukam Capital.
Pandemic Impact (2020 onwards): Witnessed a surge in demand as cafes shut and Work-From-Home boosted at-home coffee consumption. The years of brand building paid off.
Series A Funding (Late 2021 / Early 2022): Closed a $6.5 Million round led by Rukam Capital and DSG Consumer Partners.
Current Projected Turnover (FY ending ~Mar 2022): Aiming for upwards of ₹30 Crores.
Current Revenue Split (approx): 50% Online (Own Website + Marketplaces), 50% Offline (Retail + B2B).
Online: ~65% Own Website, 35% Marketplaces.
Current Team Size: ~130 people (Manufacturing, Operations, Delivery, Core Team, Admin etc.).
Manufacturing: In-house facility in Okhla, Delhi (for all products except RTD). Office remains in Shahpur Jat.
The Sleepy Owl Ecosystem Today 🏢
Sleepy Owl operates a sophisticated D2C and omnichannel model:
Online: Strong presence on their own website (sleepyowl.co) which drives ~65% of online revenue, complemented by marketplaces like Amazon and BigBasket (~35%). Focuses on customer acquisition (Facebook, Instagram, Google, YouTube ads via in-house team & agencies) and retention (email marketing, loyalty, optimizing Average Order Value).
Offline: Present in 1000+ retail stores, primarily in Delhi NCR and Mumbai, with gradual expansion to other cities. Mix of modern trade (e.g., Modern Bazaar) and general trade. Uses a dedicated sales team and distributors.
B2B: Supplies to cafes, restaurants, and corporate gifting channels.
Manufacturing: Owns and operates a manufacturing unit in Okhla, Delhi, ensuring quality control for its core products. RTD range is co-manufactured.
Vision for the Future 🔮
Sleepy Owl aims to be at the forefront of coffee innovation in India, sticking to its core ethos of convenience and great taste.
Short-Term Goal: Achieve ₹100 Crore revenue run rate in the next 18 months (from early 2022).
Product Pipeline:
Premium Instant Coffee (with a Sleepy Owl twist).
Plant-based RTD Coffee (Oat/Almond milk).
Continuing innovation across formats.
Market Position: Evolve from 'Premium'/'Mass Premium' to a household name across different coffee segments, always emphasizing convenience.
Long-Term Ambition: Become a ₹500+ Crore brand, capitalizing on India's burgeoning coffee market. They see the current market as still being at an inflection point with massive room for growth.
"We intend to be at the forefront of Coffee innovation in the country. We want to be the brand that is you know, taking bold risks when it comes to introducing products and at the same time doing traditional products but giving it the Sleepy Owl twist..."
Arman Sood and his co-founders have taken Sleepy Owl from a dorm room experiment to a significant player in India's coffee landscape. Their journey underscores the power of identifying niche opportunities, pivoting smartly, relentless execution, and building a strong brand connect with consumers, one convenient cup at a time.
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