Startups don’t always have to be unique, disruptive and high-tech to get big exits — some of the oldest businesses models, if executed well, can generate some outsized results for founders too.
Bakery chain Theobroma has been acquired by private equity firm ChrysCapital for Rs. 2,410 crore, ET reports. ChrysCapital will buy around 90% stake from the company’s promoters and existing investor ICICI Venture. The promoters will retain about a 10% stake. ChrysCapital is reportedly keen on creating a quick-service restaurant (QSR) platform by buying out brands such as Theobroma and The Belgian Waffle Co.
ICICI Ventures holds a 42% stake in Theobroma, which it had purchased for just Rs. 310 crore in 2017. ChrysCapital had been in talks to acquire Theobroma for Rs. 3,000 crore, but the numbers seem to have come down following Theobroma’s weak financial results.
But an acquisition for Rs. 2,410 crore still represents a massive financial win for the founders. Theobroma had been started in 2004 as a bakery with just 4 tables by sisters Kainaz Messman Harchandrai and Tina Messman Wykes. Kainaz, a trained pastry chef who studied at prestigious institutions including The Institute of Hotel Management (IHM), Mumbai, Oberoi Centre of Learning and Development (OCLD), Delhi, and Le Cordon Bleu, London, embarked on this venture after a life-changing back injury made it difficult for her to continue working as a chef in hotels. Supported by their father’s initial capital loan of around Rs. 1 crore – Rs. 1.5 crore, the sisters launched Theobroma with a focus on high-quality, European-style artisanal desserts, a niche largely underserved in Mumbai’s bakery scene at the time.
The first outlet, situated in Colaba Causeway, was tiny with just 4 tables. But Theobroma — which meant ‘food of the gods’ in Greek — quickly gained popularity for its rich chocolate chip brownies, truffle cakes, mawa cakes, and other innovative pastries that appealed to urban, young customers seeking premium yet accessible gourmet desserts. The brand emphasized using fine ingredients like Belgian chocolate, real butter, and natural flavorings, setting a new standard in India’s dessert market. They also helped popularize brownies and European-style desserts in India, elevating the culinary expectations for baked goods in Mumbai and beyond.
For about six years, Theobroma operated only a single outlet while steadily building a loyal customer base and refining their offerings. By 2014, after struggles with funding typical of a high quality, artisan food business, the founders secured a loan of Rs. 5 crore that enabled expansion beyond Mumbai to other major cities like Delhi, Pune, Hyderabad, and Bangalore. This period marked the transition from a small family bakery to a national chain, growing to over 50 outlets by 2020.
Theobroma today has around 225 stores in over 30 cities offering brownies, cakes, desserts, chocolates, breads, and snacks. In FY24, it posted a revenue of Rs. 400 crore, with adjusted EBITDA of Rs. 60 crore. In FY25, it is expected to post revenue of Rs. 525 crore, with an adjusted EBITDA of Rs. 80-100 crore. And the company’s acquisition for Rs. 2,410 crore shows that no matter how commodified the business, execution over long period of time and customer love can lead to some massive financial outcomes.