How You Can Scale Your Small Business | A Boba Guys’ Case Study

Humble Beginnings

Recently, I visited a tea shop called, “Boba Guys.” If you’re not from the Bay Area, you may not have heard of it. In 2011, Boba Guys launched with a single location in San Francisco’s Mission District and people lined up around the block for its boba drinks. Boba Guys sells boba tea, a drink made with tea, milk, and tapioca balls. While sipping on the beverage, you get mouthfuls of tapioca balls, so it’s a dessert and beverage in one.

Changing the Face of Boba

Boba has been popular in San Francisco for quite some time. Many small San Francisco businesses sell boba, but none has a following like Boba Guys. Since day one, Boba Guys attracted a following and to this day, people still wait in line for Boba Guys.

They have developed a reputation of providing their customers drinks made with the best quality ingredients and their customers are willing to not only wait for it, but also pay a premium. Unlike other small businesses that sell boba, Boba Guys successfully created a brand identity and scaled their business.

Expanding Beyond San Francisco

As I stood in Boba Guys’ latest San Francisco location, I noticed some catalogues that they encouraged customers to peruse while waiting. I picked up a catalogue, skimmed through it, and stopped on the page containing their origin story. I discovered that not only had Boba Guys expanded throughout San Francisco, they also now have locations in Los Angeles and New York.

How Boba Guys’ Was Able to Scale

Boba Guys’ story made me curious about what they did to help their company scale. I discovered that they 1) structured their company in a way that allowed them to scale; 2) raised money; and 3) focused on branding.

A Legal Structure Designed for Scaling

From the very beginning Boba Guys had its eye towards scaling. In 2012, Boba Guys incorporated as a corporation. There are two types of business entities that protect business owners against personal liability: LLCs and corporations. Businesses that look to scale generally are usually structured as corporations because a corporate structure gives the most flexibility when it comes to raising money.

Raising Money

Boba Guys was never afraid of raising money. Not only is raising money for your company highly regulated--depending on how you plan to raise money, you may have to comply with both state and federal securities laws--it is also intimidating for many business owners. Asking for money isn’t the idea of a good time for most people, but Boba Guys did it over and over again.

In 2014, Boba Guys raised $30,000 from Kickstarter. For a Kickstarter campaign in the food category, $30,000 is considered a huge success.

Beginning in 2016, Boba Guys began raising money using the securities laws.

  • In 2016, they raised $750,000 using a law that allowed them to raise from both wealthy and not-so-wealthy individuals.

  • In 2018, they raised about $100,000.

  • This year, they are hoping to raise $60,000.

Interestingly, in August 2018, Boba Guys reported that it had revenues in the $1 million to $5 million range, but as of January 2019, it reported revenues in the $5 million to $25 million range, suggesting that their revenues have continued to grow since their latest capital raise.

A Focus on Brand

Finally, part of Boba Guys’ success can be attributed to their branding. Boba Guys isn’t merely a drink company, they’ve positioned themselves as a lifestyle brand. Their target consumers are urban, young, and trendy.

The very consumers they are looking to target can be reflected in the models seen in their catalogues, wearing stylish clothes, looking laid back, and toting cups emblazoned with the Boba Guys’ logo of an anteater drinking boba.

To further cement their brand in the minds of consumers, Boba Guys’ have created merchandise with the term, “Boba Bae” emblazoned on the front.

Since Day 1, Boba Guys had a brand concept in mind. Their stores are minimalistic and modern, decorated in white, black, with accents of light wood, and glass fixtures allowing passersby to look into the store and allowing customers to see what goes into making their drinks.

Each store has their logo of an anteater drinking boba and each cup is also imprinted with the same logo. Because Boba Guys uses uniformity throughout each store, customers know exactly what to expect when they enter a Boba Guys.

Not only has Boba Guys created a solid brand concept, they are also serious about brand protection. They have trademarked their anteater logo. They also trademarked the following terms:

  • Boba Guys, the name of their boba company;

  • The Tea People, which is their tea company;

  • Pure Milk Tea; and

  • Boba Bae, the phrase that is used on their t-shirts and sweatshirts


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This article is provided for informational purposes only and should not be construed as legal advice. Read our disclaimer here.

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