Kopi Kenangan, a tech-enabled coffee chain that serves Indonesian-style coffee in the country, today announced it has raised US$20 million in a fresh round of investment from Sequoia India.
The company plans to use the money to open 150 outlets by the end of this year and expand to 1,000 stores throughout Indonesia by 2021.
A profitable company, Kopi Kenangan plans to expand the business across Southeast Asia in future.
“Indonesia is the world’s fourth-largest coffee exporter yet has the lowest coffee consumption per capita in the region because there is no large, affordable coffee chain with localised taste,” said Co-founder and CEO Tirtanata.
Founded in 2017 by Edward Tirtanata and James Prananto, Kopi Kenangan aims to “fill the gap between the high-priced coffee served at international coffee chains and the instant coffee sold at many street stalls”. Today, the company has 80 stores in eight cities (it had only 16 stores in October 2018).
Kopi Kenangan offers coffee made with locally-sourced ingredients, including a proprietary coffee blends from four different regions of Indonesia, fresh milk and organic palm sugar, as available in its best-selling product “Es Kopi Kenangan Mantan”, or literally translated as “Memory of Ex Ice Coffee”, a moniker gimmick that young, tech-savvy population of Indonesia is instantly hooked on.
The company hailed its ‘new retail’ model, which the founders said as “combining the convenience and choice of online shopping with the ‘touch & feel’ of an offline experience”.
Consumers can order their coffee for pick-up through the Kopi Kenangan app, which was launched in April, to avoid queuing at its kiosk-style stores, or have their coffee delivered by food tech players like GrabFood and Go-Food, which sells about 30 per cent of Kopi Kenangan’s coffee.
The company is now focussing on personalisation by positioning its app as a ‘personal barista’ who knows how sweet or strong the consumers like their coffee. Next, the company is planning to deploy IoT technology to manage inventory and reduce wastage, which will cut costs further.
“The majority of our order is consumed in takeaway format by the young generation who live an increasingly fast-paced life in urban areas. The idea is to bring a moment of delight to our customers every day, making Kopi Kenangan more than just a coffee brand — but part of the urban lifestyle,” said COO Prananto.
Shailendra Singh, Managing Director, Sequoia Capital (India) Singapore said that the conversation of possible funding by Sequoia Capital was dated back in April as the VC got intrigued by the coffee chain’s approach to technology-first customer experience.
Kopi Kenangan has previously raised US$8 million from Indonesia’s Alpha JWC Ventures in October last year.