Japan’s DG Daiwa Ventures has led a $1.3 million pre-Series A funding round for New Delhi-based coffee chain First Coffee, a deal investors say marks the venture capital firm’s entry into India’s specialty café segment as domestic coffee consumption surges.
The Hindu BusinessLine reported on 19 August 2026 that the round, described by World Coffee Portal as a “second funding round,” also drew participation from existing backer BEENEXT along with angel investors Sanjay Kapoor of Genesis Luxury and Shashank Bhagat of BI Group, among others. According to BusinessLine, the latest raise brings First Coffee’s total funding to $2.5 million to date.
In a February 2026 release confirming its role as a new investor in the pre-Series A, DG Daiwa Ventures said the investment is its first in India’s specialty coffee market. The Tokyo-based firm typically focuses on AI, security, deep tech, fintech, climate tech, and robotics, and noted that it collaborates with global investors in North America and other regions through co-investments and co-hosted events.
First Coffee, founded by Sohrab Sitaram and Shiv Dhawan, opened its first store in April 2024 at New Delhi’s Pacific Outlet Mall, according to World Coffee Portal, which cites a 2023 founding year. By contrast, BusinessLine, Indian Retailer, and VCCircle state the company was founded in 2024. BusinessLine and Indian Retailer now place the brand at more than 25 outlets across Delhi, Punjab, and Haryana.
BusinessLine reported that First Coffee plans to use the fresh capital to accelerate store expansion, build its corporate team, strengthen brand value through marketing initiatives, and invest in product development. Indian Retailer added that the New Delhi-based operator is preparing to enter India’s Tier 2 markets and widen its customer base.
Customer Market Insights data cited by BusinessLine and Indian Retailer projects the Indian coffee market to reach $1,227.47 million by 2032, with an annual growth rate of 9.87% between 2024 and 2033. BusinessLine further noted that domestic coffee consumption has “increased drastically” over the last five years, driven by rising demand for specialty coffee and convenience.
The DGDV release described India as historically tea-drinking but said rapid economic growth is expanding coffee consumption, particularly among younger consumers interested in specialty coffee. World Coffee Portal characterised First Coffee as one of several specialty coffee start-ups pursuing ambitious growth in India’s “maturing branded coffee shop market.”
First Coffee says it is targeting this younger demographic by focusing on cold coffee-based beverages and matcha, and told BusinessLine it has gained market share among Gen Z consumers while achieving some of the highest repeat rates among young customers in the industry. Indian Retailer reported earlier that in September 2024, First Coffee’s four stores recorded 25% month-on-month growth, with each outlet serving around 100 cups of specialty coffee per day.
Both BusinessLine and Indian Retailer report that the chain positions itself as a “mass-premium” specialty coffee brand, using small-format quick-service outlets in locations such as malls, corporate parks, high streets, and metro stations. The company told these publications that it uses big data and AI analysis to enhance customer interaction and optimise operations, and described its approach as a hybrid go-to-market strategy with an increased focus on small-format stores.
On the product side, BusinessLine wrote that First Coffee uses 100% Arabica beans sourced from Indian estates, while a 2024 Indian Retailer article specified Harley Coffee Estate in Chikmagalur and cited a Specialty Coffee Association (SCA) score of 91%. DG Daiwa’s release likewise said the coffee used by First Coffee reaches “SCA 91,” describing 90 and above as the highest grade.
Announcing the deal, DG Daiwa Ventures Head of Global Investment Makoto Ibi said in comments reported by Indian Retailer that the firm was “glad to partner with First Coffee and fuel their ambition to change coffee culture in India,” adding that India “remains a key market” as DGDV taps into the country’s specialty coffee space.
