Can Fambo Fix India’s Broken Food Supply Chains?

Can Fambo Fix India’s Broken Food Supply Chains?

SUMMARY

The NCR-based startup is a specialist in providing traceable, semi-processed agricultural inputs tailored for players in the ‘food away from home’ segment

Fambo leverages technology and the experience of its founders in industrial automation to streamline operations

Fambo serves more than 40 clients that include quick-service restaurants (QSRs) and chain dining restaurants

The gastronomic Indian is more outbound now, looking away from home for delectables, and the shift has left eateries in a scramble.

A steep loss of interest in cooking at home, an evolving consumption pattern, and a change in preference for food and beverages have come as a windfall for dine-in and food delivery businesses, dishing out impressive growth for the restaurant industry through the last few years.

The food services sector alone is on course to average an 8.1% growth rate in the next five years, according to a report. Rapid urbanisation, strong economic fundamentals, a growing young population, and an enhanced consumer exposure have spiced up this journey.

Procuring raw materials, however, continues to be a challenge. While quality assurance remains paramount, there is still no reliable supplier evaluation system or effective material testing in place.

Price volatility too drives the industry in a pickle when market dynamics and seasonal factors weigh on profit margins. Most critically, supply chain disruptions caused by sourcing and transportation snag often lead to delays and shortages.

Fambo found the sweet spot in this. The NCR-based startup is a specialist in providing traceable, semi-processed agricultural inputs tailored for players in the ‘food away from home’ segment.

Birth Of Fambo

Akshay Tripathi and Sudarshan Satle set up Fambo in 2022 to address such challenges with its holistic solutions.

Tripathi had earlier worked at the robotics startup Addverb for over three years, during which he saw Reliance pick up 54% of the pie for $132 Mn. At Addverb, which was focussed on supply chain automation, Tripathi saw how technology was transforming the entire industry. He was witness to the amalgamation of traditional supply chain practices with Industry 4.0 and 5.0 technologies.

“This exposure piqued my interest in the domain,” Tripathi told Inc42. “While working on a project for Addverb in the US, I came across companies like AeroFarms, InFarm, and Sysco. It made me think about how we could integrate technology and automation practices into the agrarian food supply chain.”

Fambo cofounder Satle was a senior in engineering and a colleague at Addverb. When Tripathi shared his vision with him, Satle was intrigued to join the journey. Interestingly, the startup got its first funding from the founders of Addverb themselves.

In the early stages, the founders started testing the market, focussing on the ‘food away from home’ segment. Fambo’s first big customer was California Burrito, which led to subsequent partnerships with brands like Burger King.

Fambo began supplying semi-processed agricultural inputs to address common challenges in traditional kitchen operations such as chopping vegetables, frying, or preparing recipes from scratch. These tasks often call for a wider kitchen space, longer preparation times, and fails to guarantee the taste. Fambo’s semi-processed ingredients helped in smaller kitchens, reduced preparation time, ensured consistent taste and quality.

“By meeting strict safety and quality standards, we help streamline operations and improve efficiency,” Tripathi said.

Fambo works with a network of over 4,000 farmers, connecting them through Farmer Producer Organisations (FPOs). It also guides them on what crops to grow, provides inputs for better yield, and assures them of fair and fixed prices for their produce. “By eliminating middlemen, farmers benefit from better earnings, and we ensure high-quality produce with minimal wastage. In fact, our wastage rate is less than 1%,” he said.

How Does Fambo Operate?

Fambo’s operations revolve around micro-processing centres located strategically in central parts of the cities. “This reduces the supply time across the city,” Tripathi said. These centers process the farm produce and deliver the ingredients as per requirements of multiple brands.

Fambo leverages technology and the experience of its founders in industrial automation to streamline operations by accurately predicting customer orders, onboarding restaurants onto its portal for seamless order management, and automating inventory and provisioning to reduce manual intervention. The system is also designed to plan for irregular or sudden orders, ensuring smooth supply chain operations.

Fambo serves more than 40 clients that include quick-service restaurants (QSRs) and chain dining restaurants. It does not work with specialty restaurants, though.

The startup generates revenue by selling agricultural and semi-processed items with the margin included in the sale price. It does not charge its clients for access to its tech platform. Instead, revenue is generated through the sale of products, based on customer orders.

As Tripathi noted, customers cannot purchase directly from Fambo’s website. Instead, they must be onboarded onto Fambo’s platform. Orders are typically processed through purchase orders, and sometimes it synchronises with the client’s system to receive the orders.

Cracking The Next Level

While Fambo ended FY24 with a INR 18-Cr topline, Tripathi sees a significant rise in revenue in this fiscal since the company focussed on profitability, instead of going aggressive on growth. The startup turned profitable in November 2024.

Fambo recently raised INR 21 Cr (around $2.4 Mn) in a seed funding round led by EV2 Ventures. The funds are being allocated across three main areas: automation and process improvement, tech upgrade, and capability expansion.

Automation will help reduce labour-intensive tasks and improve efficiency. Tech upgrade, on the other hand, will implement a GI system, CRM, and marketing tools to streamline operations, Tripathi said.

Fambo has launched a frozen product line and plans to expand in this category further. It plans to use some of the funding to scale operations in new geographies, including Lucknow, Chandigarh, Jaipur, and potentially Mumbai or Bangalore.

While Fambo has set ambitious goals to create a category, there are a couple of challenges. The first is educating customers about the value of the product. Global brands with established practices understand the benefits of certain methods or products, but Indian customers often require education to realise their importance. This makes selling a value-added product a harder task.

The second challenge pertains to working with farmers in India, who are traditionally focussed on cultivating cash crops. Convincing them to transition to horticulture crops requires building trust and demonstrating the benefits over time. It remains to be seen if Fambo can foster its network and relationship to drive adoption.

[Edited by Kumar Chatterjee]

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.

You have reached your limit of free stories
Become A Startup Insider With Inc42 Plus

Join our exclusive community of 10,000+ founders, investors & operators and stay ahead in india's startup & business economy.

2 YEAR PLAN
₹19999
₹7999
₹333/Month
UNLOCK 60% OFF
Cancel Anytime
1 YEAR PLAN
₹9999
₹4999
₹416/Month
UNLOCK 50% OFF
Cancel Anytime
Already A Member?
Discover Startups & Business Models

Unleash your potential by exploring unlimited articles, trackers, and playbooks. Identify the hottest startup deals, supercharge your innovation projects, and stay updated with expert curation.

Can Fambo Fix India’s Broken Food Supply Chains?-Inc42 Media
How-To’s on Starting & Scaling Up

Empower yourself with comprehensive playbooks, expert analysis, and invaluable insights. Learn to validate ideas, acquire customers, secure funding, and navigate the journey to startup success.

Can Fambo Fix India’s Broken Food Supply Chains?-Inc42 Media
Identify Trends & New Markets

Access 75+ in-depth reports on frontier industries. Gain exclusive market intelligence, understand market landscapes, and decode emerging trends to make informed decisions.

Can Fambo Fix India’s Broken Food Supply Chains?-Inc42 Media
Track & Decode the Investment Landscape

Stay ahead with startup and funding trackers. Analyse investment strategies, profile successful investors, and keep track of upcoming funds, accelerators, and more.

Can Fambo Fix India’s Broken Food Supply Chains?-Inc42 Media
Can Fambo Fix India’s Broken Food Supply Chains?-Inc42 Media
You’re in Good company