The Story Of The Rise And Fall Of Teavana

Teavana was founded in Atlanta in the late 1990s by Andrew and Nancy Mack. The company reflected the Macks' love of tea culture and a dream of sharing that with others.

The first store was in Phipps Plaza in Lenox Square, and by the mid-2000s, there were 50 shops. Teavana went public in 2011, raking in $121 million on its IPO.

Starbucks acquired Teavana in a $620 million purchase in 2012, and it intended to use the rollout of a Tazo store in Seattle as a business model for the Teavana brand.

The coffee retailer considered Teavana promising, as it enjoyed $1.4 billion in sales from the Tazo brand

at the time. It also intended to sell Teavana products to grocery stores.

When Starbucks bought Teavana, the company projected that the worldwide tea market would hold about $90 billion in sales, but it was truly only a $40 billion market.

Additionally, Americans were already loving ready-to-drink teas in 2012, and demand for loose teas was tiny by comparison. This made Teavana challenging for Starbucks.

Prior to the acquisition, Teavana had a famous wall of tea but little else to encourage visitors to sit down and stay. Starbucks wanted to remedy this by opening tea bars.

In October of 2013, Starbucks opened Teavana Fine Teas + Tea Bar on the Upper East Side of Manhattan. According to reviews on Yelp,

many loved the bar while it lasted.

While Starbucks has baristas, Teavana had teaologists, on-site educators who passed on their love of high-end tea and all the rituals that go with it to customers.

Ideally, customers would learn about the beverage's history and become inspired to buy the loose leaf teas. It was also a teaologist who oversaw tea development at the company.