E-commerce pioneers make a comeback on a different pitch
Twenty years ago, K Vaitheeswaran and Sundeep Thakran unveiled India’s first e-commerce company Fabmart.com. They did so with four other co-founders at a prominent Bengaluru hotel in a room named 'Tipu's Chamber'.
The venture, later rebranded Indiaplaza.com, shut down in 2013. The demise was due to various factors, including lack of funding and inability to compete with new players such as Flipkart and Snapdeal.
Now, they are back. On Wednesday, Vaitheeswaran and Thakran unveiled a new venture called Again Drinks in the same hotel room. Again Drinks will offer ready-to-drink and healthy beverages with low-fat dairy and containing, they say, real fruits, nuts, vegetables, and natural sweeteners.
“I was 36 then and am now 56. If we had to launch a start-up now, the condition was it must be something not done before, and have a significant and large social impact,” says Vaitheeswaran. “We didn’t want to launch India’s 147th e-commerce company.”
He expects the country's beverage market to reach ~1.36 trillion by 2023, at an annual growth rate of 15 per cent. He sees the addressable market for Again Drinks as ~15,000 crore by that time, and says he expects to build a ~500-crore business in the next few years.
“Vaithee (Vaitheeswaran) is one of India's most experienced entrepreneurs in the retail e-commerce space. Timing and luck didn't work for him in the past but failure is a great teacher,” said Rishikesha Krishnan, professor of strategy at the IIM Bangalore. “All he needs to do is follow his own advice.” Considering the broken and poor quality of cold chains in India, the products created by Again Drinks have been created to be stored at ambient temperature, not requiring refrigeration, allowing on-the-go use.
Vaitheeswaran and his team worked on the idea for about 18 months. They visited some top institutes and met a lot of experts to discuss the product they wanted to create, saying they wanted a minimum shelf life of 90 days.
“They told us this is impossible— you have to put preservatives and sugar. We got more excited, as it had never been done before,” said Vaitheeswaran. His venture has filed for two provisional patents, for the process and formulation of the product.
The venture offers two variants of a double-toned (low fat) milk drink— almonds, cashew, dates and strawberry, chocolate, jaggery. It also offerers two variants of a double-toned yoghurt drink. A 200 ml beverage has been priced at ~50.
Thakran, the other co-founder, said the challenge was not to only build a shelf-stable product but in bringing ‘wholesomeness’ into it. “This (includes) not adding sugar, preservatives or artificial ingredients, and putting in a lot of fruit, vegetables and nuts,” he explains.
“If we had to launch a startup now, the condition was it must be something that is not done before... We didn't want to launch India’s 147th e-commerce company" K Vaitheeswaran Co-founder, Again Drinks
Thakran said he was motivated to start Again Drinks two years earlier, after struggling to find nutritious beverages for his son, an international junior tennis player. “Everybody we approached in the industry were naysayers, saying it can’t be done.”
Four variants of Again Drinks have been experimentally launched in select retail outlets in Bengaluru, such as Namdhari’s Fresh and Godrej Nature's Basket and through online grocery stores, including BigBasket.com. The range will be available across retail chains in key cities of south India, starting from Chennai. Then, they will launch in the rest of the country. “I am going to stick my neck out and say we are targeting to sell half a million bottles by next year,” said Vaitheeswaran.
The venture is backed by angel investors and wealthy individuals. Former Tata Sons director R Gopalakrishnan has joined as a mentor. The products are being made at the facilities of Nilgiri's Dairy Farm and Kwality Milk Foods in the south.
Again Drinks said it was also planning for expansion abroad and to export toWest Asia and other countries in this continent with demand similar to India's. It is trying to raise a larger funding round from venture capital entities.