Healthy snack brands are seeing explosive growth, propelled by a surge in health-conscious consumers, further amplified by social media influencers. However, scaling these businesses beyond the niche markets while staying profitable presents a major hurdle.
Peak XV Partners-backed The Whole Truth clocked 125% growth in operating revenue to Rs 36 crore in FY23, while Matrix Partners India-backed Open Secret nearly tripled its revenue to Rs 37 crore.
Larger players in the segment such as ITC-backed Yoga Bar clocked 31% revenue growth to Rs 88 crore, while Tata Consumer Soulfull’s revenue grew 88% to Rs 64 crore in FY23. Marico-owned True Elements posted a 24% growth to Rs 57 crore, regulatory filings sourced from Registrar of Companies and Tofler showed.
However, these brands, which sell products such as chocolate and protein bars, millets and dry fruits-based snacks, granola bars, oats, and breakfast cereal, also widened their losses during the year.
“When we invested in The Whole Truth in 2019, it was just an idea, and the company was pre-revenue. We believe that awareness about what people are consuming is increasing, and that awareness levels will start influencing what people consume,” Manu Chandra, founder and managing partner at Sauce VC, a New Delhi-based early stage consumer-focussed venture capital firm, told ET. “The way it has panned out now is beyond what we had anticipated”.
Chandra said consumers are becoming significantly more aware of what they are consuming, and this is a function of increasingly available information through social media.
“Earlier, your source of information would be a trainer or nutritionist but now there are influencers like Andrew Huberman, Cyriac Abby Philips (The Liver Doc), Revant Himatsingka (FoodPharmer) who are household names, and they are the ones who are perpetuating awareness and it’s becoming more mainstream,” he said.
Feb 08,2024
Source: Economic Times
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