DavidsTea co-founder, namesake, David Segal resigns as chain’s brand ambassador

TORONTO – David Segal – the David behind DavidsTea Inc. – has resigned as brand ambassador for that Montreal-based tea retailer he created and co-founded.

Segal, who first envisioned creating a boutique business to sell blended loose-leaf teas when he would be a student in Quebec, founded the organization in 2008 together with his cousin Herschel Segal, the magnate behind Canadian fashion chain Le Chateau Inc.

In a filing using the U.S. Securities and Exchange Commission on Monday, DavidsTea said Segal left last Friday to “dedicate much more of his time to exploring other entrepreneurial interests.”

Segal, 35, remains the third-largest shareholder within the company, with nearly 10 % from the outstanding shares.

Though he operated weight loss of the behind-the-scenes player than the public-facing voice of the trademark, Segal was credited as the visionary behind the business’s sleek store design, presentation and development and its seasonally rotating assortment of tea blends.

He couldn’t be reached for comment on Monday.

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“(Segal) is really centered on innovation, trying to develop tea assortment and product,” chief executive Sylvain Toutant said in an interview last fall concerning the company’s founder.

“Innovation within our brand is essential, so people can come back and find out new tastes.”



Last year, Segal had worked to expand the retailer’s choice of matcha, a conventional Japanese green tea, and was known to turn to food and restaurant trends for insights, infusing new tea blends with fruit, pumpkin and vanilla. Also, he created a special canister for mixing matcha quickly as well as on the go, since the traditional process is slow and involves a whisk.

DavidsTea, which competes with Starbucks Corp.-owned Teavana, has been working to grow its store footprint and now has 156 stores in Canada and 37 in the U.S., selling blends of tea, tea accessories along with other products.

In its last fiscal year it opened 39 stores and it is planning to open the same number this season.

“Because they have been looking at expansion plans, (Segal) may have had different ideas from that of management and they may not begin to see the same way forward,” said Wendy Evans, a Toronto-based retail consultant, concerning the co-founder’s departure.

“The clients are a good concept. These were trying to do with tea what’s been completed with coffee – inflate the course and make it much broader,” she said. “The issue in my mind is when much is he the company visionary, and if so, who is going to fill that role in the company?”

DavidsTea went public to much fanfare last June and it is shares initially soared 42 per cent to nearly US$30, however they now trade at below US$12.

At a business conference in January, the organization reiterated its previously issued outlook for fourth quarter and full-year recent results for fiscal 2015, with sales within the selection of $175 million to $177 million, a comparable sales increase slightly above the mid-single-digit range and adjusted per-share income of 37 cents to 39 cents.

hshaw@nationalpost.com

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