How D2C Brand GO DESi Is Adding Modern Twist To Traditional Sweets & Candies

There’s something special about the chatpata (deliciously tangy) candies that will never fail to tickle Indian taste buds. Many of us are still besotted with mango and imli (tamarind) delights, so much so that these timeless flavours have found their way into chutneys, juices, curries and countless other dishes.

Nostalgia hit him when Vinay Kothari, an FMCG professional, stumbled upon some jackfruit candies at a roadside stall on a trek to the Western Ghats in January 2018. The familiar taste flooded his mind with long-forgotten childhood memories, and he left the place with bags full of those savoury candies. 

Upon his return, he booked a stall at a flea market and sold the entire stock in half a day. Overwhelmed by the response, he joined forces with his sister Raksha (an engineer by profession) to set up a new venture. The duo launched the direct-to-consumer (D2C) food brand GO DESi before the year was out.

As its name suggests, the brand encourages consumers to embrace their desi roots and buy traditional candies in a variety of flavours, all made from fruit pulp and brimming with the natural goodness of jaggery used as a sweetener. 

GO DESi runs a 40K sq. ft manufacturing facility in Sira village and Bidadi near Bengaluru and collaborates with farmers, self-help groups, co-operatives and rural businesses to ensure a steady product flow. These tie-ups are critical for a food brand that thrives on local flavours and must have a thorough knowledge of the landscape for best-in-class procurement and excellence in production. 

The brand has 40 SKUs on offer across four categories. These include its flagship DESi PoPz (candy bar on a stick), traditional Indian sweets, snacks and mouth fresheners. 

GO DESi clocked INR 60 Cr in revenue in FY24 and targets INR 75 Cr in FY25.

Inside GO DESi’s ‘Sweet’ Bet: Old Classics Made New

“GO DESi isn’t just one thing. It’s not just about the products or the stores. It is about crafting a unique experience that our consumers can connect with,” said Vinay. 

So, it incorporates a whole range of regional flavours and natural ingredients in its products. The focus is more on exploring varieties not readily available in urban markets. For instance, DESi PoPz is made from tamarind, mango or guava pulp. 

It has also introduced yummy but healthy snacks like baked ragi chips, guava bytes, spicy mango bytes and more. 

But the best part of its product journey is a bold leap to reimagine traditional sweets. Classic Indian treats like kaju katli, laddu and barfi are made cool and contemporary, breathing fresh life into these long-cherished confections.

“You may give your partner a popular chocolate bar on Valentine’s Day, but do you consider giving them a kaju katli? Not ever, but why? The challenge lies in making traditional sweets cool enough for that. We are working on a product line that resonates with Gen Z and Generation Alpha,” Vinay sounded confident.

How does GO DESi achieve this? By reshaping traditional barfis as barfi bars resembling chocolate bars. This innovative twist preserves the essence of the treat and aligns with today’s consumer preference. The packaging complements the modern approach and stylish gift boxes are rolled out during Diwali and Raksha Bandhan to add to the ‘cool’ quotient.

From Offline To Online, How GO DESi Has Mastered Omnichannel

If product development is an essential criterion for business success, so is distribution and sales. Brand discovery and reaching customers en masse are challenging for new brands. To cope with it, the founders kept the pricing pocket-friendly. Their flagship product, DESi PoPz, is sold at INR 5 a piece. More importantly, they prioritised offline distribution instead of an online-first approach that most D2C brands choose to minimise intermediary costs.

For Vinay, offline distribution comes naturally, given his prior experience, but it was also a strategic move despite the high costs of brick-and-mortar retail. 

“To achieve a certain top line, we had to reach a much larger audience, which was initially daunting. Hence, the offline-first approach. Nevertheless, we decided not to rely on a single route and gradually adopted a multi-channel strategy. This worked well, as we did not put all our eggs in one basket. Today, we are truly an omnichannel brand, and this broad distribution approach has driven our success,” explained Vinay.

Covid-19 lockdowns in early 2020 further bolstered the decision to diversify the brand’s distribution from offline to online. Its digital journey started with DESi PoPz assortment boxes and the founders saw an opportunity to expand the product line minus the hassles of offline marketing. GO DESi entered the Amazon marketplace and set up its D2C website, followed by quick commerce and offline kiosks. It currently runs 31 kiosks in Bengaluru and claims a presence in 50K offline stores.  

Vinay says he always starts with DESi PoPz (due to its low price point and innovative format) whenever exploring a new distribution channel. The success of the flagship paves the way for the introduction of other products.

Currently, about 40% of the D2C player’s sales come from offline, nearly 20% from marketplaces like Flipkart and Amazon, 30% from quick commerce and just 10% from its website, typically through bulk orders. 

Rukam Capital: The Catalyst Behind GO DESi’s Growth

Breaking into an overcrowded retail space and creating a niche is no small feat, especially in a segment ruled by legacy giants like Haldiram’s and Bikanerwala. But the founders did not waver. 

“The traditional sweets market in India presents a considerable opportunity, as nearly 85% remains unorganised. Only a handful of players have transitioned to the packaged sweets segment, but the unorganised sector dwarfs the combined confectionery and chocolate markets. It is at least eight to 10 times larger,” observed Vinay.

The domestic market for packed sweets reached INR 6,229.7 Cr in 2023, per a Research and Markets report, and it is projected to surge to INR 25,970.8 Cr by 2032, at a CAGR of 17.19%. Although consumers prefer established brands, no single entity can fill this void.   

“The rising demand for packaged sweets is driving growth across platforms, and this is the gap we aim to address,” said Vinay.

Delhi-based Rukam Capital, known for investing in early stage consumer brands, has played a crucial role in this endeavour. GO DESi secured one of its first institutional rounds from Rukam in 2018, and the VC firm has consistently supported the business. It had invested INR 79 Cr across three rounds and recently joined another round of INR 41 Cr, led by Avishkaar Capital.

Vinay also lauded the VC’s support even during challenging times like the Covid-19 pandemic. “What stands out about Rukam is its thorough understanding of the ground reality. It knows what it takes to build and scale a business and understands startups’ unique challenges.”

“The unorganised to organised play is a very important point for an emerging market like India. There are many much loved recipes and food products which appeal to the Indian palette. In the couple of decades prior to our investment in Go DESi with the exception of brands like PULSE, no real startup was created in the impulse category. It is a no-brainer that a high-quality product like Imli PoP would appeal to consumers all over the country,” said Archana Jahagirdar, managing partner at Rukam Capital.

She acknowledged that the founders’ backgrounds and their commitment to building a healthy yet tasty product made this investment decision fairly easy. 

“Our approach with our portfolio is to be there in a non-intrusive way and help with thinking through an appropriate solution for such problems. So, from emphasising on in early days on keeping a close eye on business fundamentals, brand building and adding heft to the leadership team we have been there with the founders every step of the way,”  Jahagirdar added.

GO DESi’s Vision: More Twists To Indian Sweets, Overseas Expansion 

According to industry estimates, around 82% of Indians prefer traditional sweets to Western desserts, chocolate and ice cream. Keeping in mind the evolving market and consumers, GO DESi plans to dive deep into traditional sweets.

It will also launch new flavours and explore new product categories. The focus is to ensure widespread consumption of Indian sweets and snacks.

The brand aims to double its kiosks from 31 to 60+ across major Indian cities by FY25, achieve a valuation of INR 500 Cr by 2028 and expand the global reach of packaged traditional foods. 

“We want to become one of those packaged food brands that make Indian cuisine truly global. Just as Korean cuisine has gained huge popularity and everyone is talking about it, we aspire to achieve the same for Indian sweets,” the founders said.

There are glitches, of course, as Indian brands need to adopt healthy ingredients, follow global quality standards and offer a broad range of dietary choices for the diabetic, the vegan, the vegetarian and more. But new-age players like GO DESi and its peers are all set to innovate and cater to the modern palate.