Meet The Three Friends Who Started Sleepy Owl Coffee in Their Delhi Apartment & Turned it Into a ₹134 Cr Beverage Brand

For decades, coffee in India was either a jar of instant powder at home or a sugary cappuccino in a café. 

The country is the sixth-largest coffee producer in the world, yet nearly all of its best Arabica beans were exported. What remained for domestic consumers was blended with chicory, stripped of character, and marketed as “coffee.”

Despite a fast-growing urban market, no brand tried to make high-quality coffee both accessible and convenient for everyday drinkers. That gap lingered for years—until 2016, when three friends from very different backgrounds decided to take a chance on it.

Starting with boxed cold brew made in their living room, Sleepy Owl grew into one of India’s most recognizable coffee brands, shaping how a generation now consumes caffeine and building a multi-category business in the process.

Meet the Founders

Arman Sood grew up in Delhi and Kolkata, the son of a businessman and a teacher. He studied law at Jindal Global Law School, but his real education came from the ventures he experimented with along the way. 

“Honestly, at that time, I didn’t even know what the word entrepreneur meant,” Arman said, laughing.

At Jindal, Arman met Ashwajeet Singh. Ashu, as everyone called him, had an entrepreneurial streak of his own. He nudged Arman to think beyond classrooms and case law. 

And Ajai Thandi completed the trio. Based in New York after college, Ajai was working in investment banking but harbored a strong desire to build something of his own in India.

From Law School to Entrepreneurship

iShack was their first taste of business. 

For three years, they imported quirky party products, hustled online sales, and managed customer service.

 “I remember sitting in class when an order worth ₹60,000 came in. I shouted ‘Yes!’ in the middle of a lecture,” Arman recalled.

But logistics killed the business. Margins were thin, shipping unreliable, and they lacked the focus needed to scale. Eventually, the venture fizzled out.

“We were too distracted back then, We were in law school, juggling studies and a business. It taught us that if you’re not putting 200 percent into something, you won’t get very far.” Arman said. 

Though iShack failed, it left the trio with a critical toolkit: basic digital marketing skills, customer insight, and the humility to know that execution mattered as much as vision.

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Why Coffee?

After graduation, Arman and Ashwajeet dabbled in other startups, while Ajai continued in New York. 

By 2015, the three reconnected, bound by a shared love for food and beverages. Their coffee habits, however, couldn’t have been more different.

Arman drank instant coffee with milk, Ashwajeet brewed with a French press, and Ajai was hooked on flat whites. 

“That was the inkling, We realized we had very different ways of consuming coffee, and that made us curious about what was really happening in this space.” Arman said.

To dig deeper, they traveled to Chikmagalur, Karnataka, India’s coffee heartland. 

“We cold-called farmers, booked a one-way ticket, and just went,” Arman recalled. 

What they found shocked them a little bit. India grew world-class Arabica coffee, but 90 percent of it was exported. What remained was blended with chicory and sold as instant coffee. 

“We asked ourselves, why should Indians settle for less when we grow such good coffee?” Arman said.

Finding the Gap

At the time, India’s coffee market was polarized. On one end, commoditized instant brands like Nescafé and Bru. On the other, a niche of enthusiasts grinding fresh beans at home. 

The average consumer was stuck in the middle, choosing between sugar-laden café lattes or bland instant coffee.

The trio realized that Indians wanted convenience but also deserved quality. 

“If you hand someone raw coffee beans, most people won’t know what to do. There’s a reason you don’t buy hops and malt to make your own beer. You just buy beer,” Arman explained.

That conviction became their north star: specialty-grade coffee, but delivered in a format that was approachable and exciting.

Introducing Sleepy Owl Coffee

Sleepy Owl set out to solve a clear problem: Indians grew world-class coffee but mostly drank instant blends mixed with chicory. The founders wanted to change that by making specialty coffee both accessible and convenient.

Their first product was a 1.5-liter cold brew box with a tap-style dispenser. Smooth, less acidic, and packaged in a quirky carton, it stood out instantly and made Sleepy Owl a conversation starter in homes and offices.

Over time, the brand expanded into four key formats: 

• Cold Brew Boxes and Ready-to-Drink Cold Coffee for those who wanted refreshing, café-style beverages at home.

• Hot Brew Bags that worked like tea bags, allowing people to brew fresh coffee in minutes without equipment.

• Instant Coffee made with 100 percent Arabica, freeze-dried to retain flavor, and offered in indulgent flavors like French Vanilla and Hazelnut.

• Ground Coffee Packs for enthusiasts who still preferred traditional brewing methods.

What truly set Sleepy Owl apart was its positioning. The coffee was ethically sourced from Chikmagalur, roasted fresh, and wrapped in design-forward packaging that spoke directly to millennials.

“Coffee is a ritual, If we could be part of someone’s everyday routine, then we knew we had built more than just a beverage. We had built a brand people connect with.” Arman said.

Branding

They treated branding as seriously as the product itself. The founders knew they were not just selling coffee, they were selling a feeling.

The iconic owl logo, clean typography, and minimal design gave the brand an instantly modern look.

“The idea was that even if someone didn’t drink coffee, they should look at our box or our bag and think, this looks cool, I want to try it,” Arman recalled.

Much of the early buzz came from being Instagram-first. Every photo was styled to make coffee feel aspirational yet approachable, while local discovery platforms like Little Black Book and So Delhi amplified their presence. 

By blending clean design, relatable language, and social-first storytelling, Sleepy Owl created a brand identity that young Indians could connect with as much as the product itself.

Marketing Strategies 

If branding gave Sleepy Owl its identity, marketing gave it a voice.

From the beginning, the founders understood that they couldn’t outspend large FMCG players on traditional advertising. Instead, they leaned into digital-first, low-cost, high-engagement tactics that resonated with young consumers.

• Instagram-First Storytelling: Every post was designed to make coffee look aspirational yet approachable - cartons in fridges, mugs on desks, quirky captions that spoke like a friend. 

“When people saw our Instagram, they had to feel like, man, I want to taste that,” Arman said.

• Sampling at the Right Places: Pop-ups at offices, gyms, co-working spaces, and food festivals allowed consumers to taste before buying. These real interactions built recall that no ad could replicate.

• Discovery Platform Partnerships: Collaborations with outlets like Little Black Book and So Delhi plugged Sleepy Owl into the cultural conversation of young urban consumers.

• Witty, Targeted Email Campaigns: The brand avoided generic newsletters and instead used sharp, conversational emails with limited-time offers and behind-the-scenes stories to keep customers engaged.

• Micro-Influencer Collaborations: Instead of spending on celebrity faces, Sleepy Owl worked with food bloggers, lifestyle creators, and micro-influencers who genuinely liked the product. This grassroots approach created authentic advocacy.

• Community-Led Word-of-Mouth: Perhaps their strongest weapon, the brand treated its first hundred customers like ambassadors. 

“You can’t buy the excitement of someone recommending your product to a friend,” Arman recalled.

This playbook allowed Sleepy Owl to punch far above its weight in visibility while staying lean on costs, proving that smart, scrappy marketing can compete with deep-pocketed competitors.

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Challenges Faced 

Those early months were a blur of hustle. When couriers shut down on a government holiday, the trio loaded 100 boxes into a car and hand-delivered them across Delhi-NCR. 

“It was amazing for us and for the customers, some of them are still with us today.” Arman remembered.

But success was far from linear. 

By December, cold-brew sales slumped as winter set in. The brand had just moved into an office, expenses were piling up, and cash was tight. A consultant told them bluntly, 

“You’re too small. These numbers are awful. Come back if you can 10x this in six months. That was a wake-up call,” Arman said.

He further added, “We realized that word-of-mouth wasn’t enough. We needed systematic marketing, digital ads, and a strategy to scale.”

Scaling & Distribution

Sleepy Owl began as a direct-to-consumer brand, selling exclusively through its own website. This channel helped them build early loyalty and gather customer feedback directly. 

By 2017, they expanded to Amazon and Flipkart, giving them reach across India without heavy upfront investments in retail.

But for F&B brands, online alone is not enough.

“In F&B at scale, trade is the long game. That’s why MNCs dominate, You need muscle to build distribution.” Arman explained.

The next phase was offline expansion. Starting with modern trade outlets and premium general stores in metro cities, Sleepy Owl gradually built a retail presence. 

By 2024, the brand was present in more than 7,500 stores across 15 cities, including chains like Reliance Retail, Spencer’s, and Foodhall.

Quick commerce became a major growth driver. Platforms like Blinkit, Zepto, and Instamart put Sleepy Owl just a few taps away, perfectly suited to urban consumers who wanted their coffee instantly. 

This channel bridged the gap between impulse and accessibility, making Sleepy Owl as easy to order as groceries or snacks.

Through this hybrid distribution - D2C, e-commerce marketplaces, offline retail, and quick commerce, the brand ensured it was available wherever its consumers wanted it.

Listening to Consumers

One of the brand’s biggest pivots came from listening to customers. The black cold brew was loved by a niche, but many Indians expected cold coffee to be creamy and sweet. 

“For them it was a shock. They picked it up thinking it was traditional cold coffee and said, what is this?” Arman recalled.

Instead of resisting, the founders adapted. They launched ready-to-drink cold coffee that was creamy, indulgent, and familiar. They also surprised themselves by entering the instant coffee market. 

“We once made instant coffee the villain, But through interviews, we realized even our core customers kept a jar of instant at home. That’s when we said, let’s do it better, 100 percent Arabica, freeze-dried, with great flavors.” Arman admitted.

Ironically, instant coffee became their largest-selling category.

Funding Milestones

For a consumer brand competing in a capital-heavy category like F&B, external funding was essential. Each round gave Sleepy Owl the resources to move a step beyond bootstrapping and tackle scale systematically.

• 2018 – Seed Round: Raised $500,000 from DSG Consumer Partners, enabling the team to move operations out of their living room and hire their first employees.

• 2020 – Extended Seed: Backed by Rukam Capital, which helped scale new formats like hot brew bags and ready-to-drink coffee.

• 2021 – Series A: Closed a $6.5 million round led by DSG and Rukam. This gave Sleepy Owl the muscle to expand into retail, strengthen production, and invest in marketing.

By 2023, the company had raised about $10.7 million across four rounds and was valued at around ₹134 crore. For a brand that started with three friends brewing coffee in a living room, the valuation underlined how far they had come.

Revenue Trajectory

Revenues for Sleepy Owl didn’t rise in a straight line. They reflected experimentation, consumer adoption, and the realities of scaling a young brand in a competitive space.

• FY 2020:₹8–9 crore, driven by hot brew bags.

• FY 2023: ₹29.1 crore as the brand expanded across channels.

• FY 2024: ₹22.2 crore, a dip caused by higher costs and operational challenges.

• 2024: Over 200,000 monthly orders and 40% of sales from subscriptions.

Each setback forced sharper pivots, from innovating in instant coffee to building presence in quick commerce and retail.

Lessons in Focus and Perseverance

The failure of their first venture, iShack, drilled in one lesson: focus. 

“At that time, our attention was divided,” Arman said. “Now we know, you need to put 200 percent into one thing.” 

For the Sleepy Owl team, that meant resisting distractions and pouring all energy into coffee, even when other opportunities seemed tempting.

Perseverance became the second pillar. Building in F&B is slow and capital-intensive. 

“Entrepreneurship is a battle against the world, If you are also fighting a battle at home, it is exhausting. Having family support makes all the difference. When you hear it from them first, you can go out and fight the world.” Arman reflected. 

The founders credit not just investor backing but also unwavering family support for carrying them through the toughest winters, both literal and figurative.

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Vision Ahead

Looking ahead, Sleepy Owl is no longer content to be just a coffee company. 

The founders see it evolving into a lifestyle brand for better beverages. Coffee will remain the core, but the roadmap includes new product categories, deeper offline penetration, and international forays.

“Coffee is a psychoactive beverage,” Arman said. “If people start their day with you, that is powerful loyalty. Our goal is to be the brand India wakes up to.”

The ambition is twofold: build deeper trust with current consumers through subscriptions and retail expansion, while also making inroads into smaller towns and cities where aspirational consumption is rising fast. 

International expansion is on the radar as well, particularly in markets with large Indian diaspora communities.

For Sleepy Owl, the next phase is about scale without dilution of identity - holding on to the freshness and relatability that made it a disruptor, while building the systems of a national, and eventually global, brand.