Product details

By continuing to use our site you consent to the use of cookies as described in our privacy policy unless you have disabled them.
You can change your cookie settings at any time but parts of our site will not function correctly without them.
Subject category: Entrepreneurship
Authors: M Vasudha
Published by: Amity Research Centers
Published in: 2019

Abstract

VG Siddhartha (Siddhartha), son of a coffee plantation owner, from a family with a 140-year history of growing coffee, was the reason behind the creation of the Indian Starbucks, Cafe Coffee Day (CCD). Born in South India, Siddhartha nurtured the ambition to be a wealth creator. He achieved it when he founded India's largest coffee-shop chain, Coffee Day Enterprises, a USD572 million-in-sales business, with more than 10,000 employees. CCD, the coffee-chain, induced a nation raised on tea to drink something entirely different. Siddhartha became an icon for what India dreamed of becoming, a modern nation where entrepreneurs could brew new ideas, thus changing lives and circumstances of everyone connected to them. His industriousness attracted many investors to his company. But in order to keep expanding, Siddhartha grew addicted to something that was to trouble him deeply towards the end of his life, debt financing. As a result, CCD's total liabilities grew from USD189 million in 2011 to USD758 million in 2018. It was alleged that, weighed down by this debt and pressure from different sides, Siddhartha committed suicide on July 29th 2019. He blamed himself for failing to create a profitable business model and also blamed severe extraneous pressures from PE firms, lenders as well as the tax department for taking the extreme step. What led to this disastrous end of India's Coffee King? What are the entrepreneurial lessons from his tragic demise?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
Asia
Country:
India

Featured company

Cafe Coffee Day
Employees:
10000+
Type:
Public company
Industry:
Retail

Featured protagonist

  • VG Siddhartha (male), Founder and CEO

About

Abstract

VG Siddhartha (Siddhartha), son of a coffee plantation owner, from a family with a 140-year history of growing coffee, was the reason behind the creation of the Indian Starbucks, Cafe Coffee Day (CCD). Born in South India, Siddhartha nurtured the ambition to be a wealth creator. He achieved it when he founded India's largest coffee-shop chain, Coffee Day Enterprises, a USD572 million-in-sales business, with more than 10,000 employees. CCD, the coffee-chain, induced a nation raised on tea to drink something entirely different. Siddhartha became an icon for what India dreamed of becoming, a modern nation where entrepreneurs could brew new ideas, thus changing lives and circumstances of everyone connected to them. His industriousness attracted many investors to his company. But in order to keep expanding, Siddhartha grew addicted to something that was to trouble him deeply towards the end of his life, debt financing. As a result, CCD's total liabilities grew from USD189 million in 2011 to USD758 million in 2018. It was alleged that, weighed down by this debt and pressure from different sides, Siddhartha committed suicide on July 29th 2019. He blamed himself for failing to create a profitable business model and also blamed severe extraneous pressures from PE firms, lenders as well as the tax department for taking the extreme step. What led to this disastrous end of India's Coffee King? What are the entrepreneurial lessons from his tragic demise?

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Settings

Time period

The events covered by this case took place in 2019.

Geographical setting

Region:
Asia
Country:
India

Featured company

Cafe Coffee Day
Employees:
10000+
Type:
Public company
Industry:
Retail

Featured protagonist

  • VG Siddhartha (male), Founder and CEO

Related