Investment in India’s food industry continued this week, with venture capital allocations in the beverage and snack sectors.
Cold Pressed Juice
Fresh Food Concepts, the leading cold-pressed juice startup in northern India doing business under the brand name Juice Up, has raised $2 million in a pre-series A round of funding led by angel investors Siddhartha Gupta and Ashvin Chadha.
Launched in 2014 by Riju Gupta and Chandan Agarwal, the Delhi-based company produces a product line of 100 percent raw and fresh cold pressed juices that are available at more than 250 location across the Delhi National Capital Region (NCR) – home to 50 million people.
“We are on target to hit 75,000 bottles per month so the timing of this investment is very strategic,” Fresh Food Concepts founder and CEO Riju Gupta told India Web 2. “This gives us a great opportunity to grow 20X in this region alone.”
The company plans to use the capital to upgrade its production facility, lift sales, enhance its distribution network, strengthen its branding and marketing, and for the development of new products.
“We aspire to create a brand that stands for things that matter – our own health and the health of our environment. Everything we make will always be 100% natural, delicious and nutritionally net-positive, so that our customers are always physically and mentally better off,” said Agarwal.
With 15 years of experience across a range of sectors and an MBA from The Wharton School, Siddhartha Gupta plans to be active in using his expertise to helping Juice Up scale up.
“Fresh Food Concepts has bootstrapped its way into becoming the market leader in their region,” said Gupta. “This is a classic case of easy to enter, execution heavy segment. Lots of artisanal brands and quality products can be found across metros, but only start-ups that can scale will remain relevant.”
A Quick Snack
Sixth Sense Ventures, the self-proclaimed first domestic consumer-centric venture fund in India, has acquired a 16 percent stake in Hindustan Foods Ltd. (HFL), maker of PepsiCo Inc.’s Kurkure snack brand for US$1.2 million.
The company, which is owned by Vanity Case Group and Dempo Group, also produces food for the brands Farex, First Food (Danone) and Easum and is one of the largest contract food manufacturers in India with 13 facilities across the country.
Founded in 2014 by Nikhil Vora, Sixth Sense closed its debut fund at Rs 125 cr (US$18.34 million) earlier this year, from which it plans to invest in 12 startups.
“There are huge opportunities within the food category and our belief is that given HFL’s operational capabilities and a meaningful understanding of the consumer behavior [sic], future product launches will further open up the space for HFL,” Vora told Deal Street Asia. “HFL is our best bet on India’s fast growing Processed Food space, with possibilities of creating a strong brand presence.”
Pepsi entered the Indian snack market in 1999 with its Kurkure snacks – a hybrid between an American potato chip and traditional Indian namkeen, Kurkure, which are made of rice, corn, and gram and seasoned with Indian spices proved a success, earning the company Rs 1,000 cr (US$150 million) in 2011, according to Quartz India.
As of 2015, PepsiCo.’s Kurkure brand held 14.3 percent of India’s sweet and savory snack category – part of the country’s US$2.5 billion salty snack market according to Euromonitor. However, Quartz India reports that this year the company is maneuvering to deepen its penetration of the market by doubling its Kurkure flavors and varieties to 30, focusing on flavors that will appeal specifically to tastes in northern India including “South Tangy Twist,” “Punjabi Chatka,” and “Navratan Mix.”
“Regionalisation [sic] is a big trend in the Indian market,” Partho Chakrabarti, PepsiCo vice-president, snacks told Quartz India. “So we are dialing into local tastes and regions as the way forward for Kurkure.”
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Lynda Kiernan