Exclusive: Naagin Bags $2.1 Mn From 360ONE Asset, Others

Hot sauce startup Naagin has raised $2.1 Mn in its latest funding round led by 360ONE Asset, with participation from existing backer 8i Ventures and a clutch of undisclosed angel investors.

The startup plans to deploy the fresh proceeds to scale up its manufacturing and production capacity as well as to strengthen supply chain operations and support team expansion.

“Our focus is very clear that we need to increase scale and capacity, especially on the factory side,” Naagin Sauce cofounder Arjun Rastogi told Inc42.

Additionally, the company aims to expand its flavour portfolio and explore growth opportunities in both domestic and overseas markets.

“We want to bring more unique Indian flavors to national and international audiences,” Rastogi added.

Founded in 2019 by Rastogi, Mikhel Rajani, and Kshitij Neelakantan, Naagin began to gain momentum in early 2020, just ahead of the pandemic. Initially focused solely on hot sauces, it has since expanded its product portfolio to include chili oil, pizza-pasta sauce and salsa.

In 2022, the startup raised over $1Mn in its seed funding round from actor Abhishek Bachchan, Eight Innovate Fund-I (8i Ventures) and other high-net-worth individuals.

When the startup was first launched, operations were limited to a basic website during the early days of the pandemic. “There wasn’t much going on at the time,” Rastogi said.

However, the startup has since evolved, expanding its presence across major online marketplaces, modern trade retail channels and quick commerce platforms. It now also sells on Amazon in the US and has begun exploring international markets, with plans to scale those efforts further.

One of the most significant developments in the last five years has been the brand’s growing focus on the B2B segment. “We’ve made strong inroads into the B2B space,” the founder added.

This includes an upcoming partnership with KFC India. “From multinational QSR giants to modern cloud kitchens and new-age HoReCa brands, the idea is to become the flavor partner of choice,” he explained. The company offers both its standard product lineup and custom solutions at scale, backed by an in-house R&D team and manufacturing capabilities.

With the ambition to be present on every restaurant and dining table in India, the company is also scaling up its manufacturing infrastructure. “We’re currently in the process of expanding our manufacturing facility on the outskirts of Mumbai,” the founder added.

The company previously operated from a smaller unit in the city. With recent funding and new projects in the pipeline, it is now expanding its facility on the outskirts of Mumbai to increase production capacity and improve efficiency for the next phase of growth.

This fundraising comes at a time when the global hot sauce market is expected to become a $7.9 Bn opportunity by 2032, growing from $5.2 Bn in 2023. The market is getting overcrowded with many other D2C startups such as Kaatil, Masterchow, among others. However, it remains to be seen with fresh funding, and the first-mover advantage how Naagin Sauce scales further.