Decoding Mensa’s Growth Journey

“There is an opportunity to build a world-class company, an INR 1,000 Cr D2C brand, from India for the globe. And these next 10 years are the best time to do it,” said Ananth Narayanan, founder and CEO of Mensa Brands. 

Bold words, one would think, considering the funding winter that has gripped the Indian startup ecosystem. But it is not without merit. The D2C market in India is set to grow 5.5x, from $55 Bn in 2022 to $302 Bn by 2030, according to an Inc42 report. As the majority of online shoppers flocked to direct-to-consumer brands in the wake of the pandemic due to their fast services, streamlined prices and better customer centricity, countless companies from several sectors such as beauty, fashion and food tried to capitalise on this accelerated growth. 

Unfortunately, not all of them could scale the heights of D2C unicorns like boAt, Licious, FirstCry and Lenskart, at least not without some external handholding.

This is where the likes of Mensa Brands come in with their ‘house of brands’ business model. 

Watch Vaibhav Vardhan, cofounder and CEO of Inc42, in conversation with Mensa Brands’ founder and CEO Ananth Narayanan on the latter’s core learnings as the founder of a unicorn, the best way to navigate the startup funding winter, and the best practices for building a good team, a wholesome company culture and a great brand story.

Mensa tracks fast-growing D2C brands for acquisition, funding and scaling up while providing their founders lucrative exits. More than 20 D2C startups such as Karagiri, MyFitness and Pretty Krafts are currently associated with this ‘house of brands’ and experiencing exponential growth. 

Narayanan described his long and varied entrepreneurial journey as ‘unusual’ (again, an understatement).

Initially, he was an automotive consultant, working with McKinsey for 15 years. Next, he served as the CEO (B2B fashion) at Myntra and set up an e-pharmacy called Medlife with two other founders (merged with PharmEasy in May 2021). Post this, Mensa Brands was launched in May 2021 and grew to become India’s fastest unicorn. The road was fraught with challenges, but that made it all the more exciting.

Narayanan believes where to play matters much more than how because if your startup is not playing in a large market, it is a problem.

Mensa’s general thesis is that as GDP per capita increases in the next 10 years, there will be a higher demand for ‘distinctive’ brand assets deeply linked to social codes/values. But the brand value alone cannot take it off the ground. Although it is supposed to be easy to start a D2C brand in India, it is tough to scale the same.

“In India, there are 4,000 brands worth INR 10 Cr to INR 100 Cr in the fashion, beauty and home decor space. But they all stagnate at that level for various reasons such as [the lack of] technology, people and capital. I felt it would be an interesting space where you could scale brands,” explained Narayanan.

There can be other critical challenges. Despite D2C’s tremendous success online, adopting an omnichannel strategy is the future, as most Indians still prefer to shop offline.

“If you want to build an INR 100 Cr+ brand, at least 30-50% of your business must come from offline. Only then can you build at scale, and I think that’s one important realisation,” said Narayanan.

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