SUMMARY
The FMCG startup offers pasta, noodles, chips and more, using innovative technologies for zero-palm oil production
It follows a seven-point quality assurance programme to ensure food excellence, food safety and compliance with Indian and global standards
WickedGud has found success in an effective omnichannel model and dedicatedly works on retail expansion and unit economics
For families residing in non-metros in the 90s, kitchen cupboards filled with homemade and healthy snacks were not a rarity. Kids were kept away from processed foods for two reasons. First, big brands were expensive and not available in every nook and cranny. Second, people with traditional food knowledge knew the health hazards that might soon follow. Fast forward to the new millennium, and we often find Gen Alpha and Gen Z bingeing on junk food. Nowadays, families and individuals crave convenience foods – ready-to-cook (RTC) and ready-to-eat platters – due to busy lifestyles, rising incomes and the desire for instant gratification instead of spending hours preparing gourmet meals.
The ready-to-cook market in India has grown at a fast clip, riding the new-age consumer demand. It is estimated to reach $489 Mn during 2022-2027, growing at a CAGR of 7.12%. This market primarily features a variety of lip-smacking F&B items, such as instant noodles and pasta, instant soups and snacks, which have grown immensely popular over time. However, one D2C (direct-to-consumer) brand and its founder has used traditional ingredients found in every kitchen and created healthier alternatives of regular junk, ready-to-cook packaged foods to the masses.
Mumbai-based WickedGud makes pasta, noodles, chips and other RTC foods from mom-approved healthy ingredients like dal (pulses), chana (Bengal gram/chickpeas), chawal (brown rice), atta (whole wheat), jowar (white millet), jai (oats) and more, all filled with proteins and dietary fibres and low on saturated fats. Founder and CEO Bhuman Dani dives deep into his mission to un-junk India, one kitchen at a time using mom-approved ingredients found in every household. He claims all his products are maida free, palm oil free and free of harmful chemicals.
WickedGud’s noodles are made using a SCAD (steaming and convection air drying) technology to make sure that people eat healthily. Simply put, this is a unique combination of steaming and convection for quick and consistent cooking without adding a drop of oil, resulting in the saturated fat to be 96% lower when compared to incumbents. In contrast, most legacy brands use oil to deep-fry noodles and make them crisp.
Again, its chips are made using the popping technology with less than 12% sunflower oil and predominantly from chickpeas, while regular chips are deep-fried in palm-oil and are predominantly made with potato
Given these hi-tech processes and curated ingredients, end products remain low in calories, net carbs (digestible carbohydrates) and saturated fats. Compared to other product lines in the market, the brand claims a 96% reduction in saturated fat in its noodles and 50% less fat in chips.
The startup has a seven-point quality monitoring programme and conducts rigorous sample testing for nutrition, food safety and shelf life. It has also procured food certifications from FSSAI and U.S. FDA and others to ensure that WickedGud foods comply with local and global quality standards (more on quality monitoring later).
It has successfully adopted an omnichannel business model and its products are now sold on major ecommerce and quick-commerce platforms and in 2.5K+ offline outlets across 20 Indian states. It currently exports to the UAE and plans to enter the North American market by Q2 FY25.
A Shark Tank (Season 2) finalist, the D2C food brand raised approximately INR 17 Cr from a clutch of investors, such as Venture Catalysts++, Titan Capital, Mumbai Angels, Disruption Fund, Asiana Fund, NB Ventures, Dholakia Ventures, Hyderabad Angels, Aman Gupta (co-founder and CMO, boAT) and actor-investor Shilpa Shetty, who also became its brand ambassador in May 2023.
Although Dani did not reveal the company’s financials, he claimed a 3x YoY rise in revenue in FY24. It targets INR 20 Cr in FY25 and aims to raise a series A round in the current calendar year.
The Backstory: A Journey From Luxe Beverages To Healthy Foods
A mechanical engineer from BITS-Pilani and an MBA from INSEAD, Dani headed off to a job at Boston Consulting Group’s London office and focussed on EU-based consumer goods projects. But in spite of a successful career, he was always looking for the next big idea to start his entrepreneurial journey.
In 2016, he left BCG and moved to India to set up The Good Life Company, a startup offering luxury teas and coffees. However, Dani partially exited his maiden venture and relinquished control to strategic investors in 2021. He then came up with another innovative idea: How about bringing healthy alternatives to the traditional RTC market brimming with unhealthy/junk foods?
Although deep-pocketed FMCG behemoths did not do much, people’s attitudes towards healthy eating changed during the pandemic. It was a tectonic shift, not limited to the urban and affluent customers. A new market for healthy foods was emerging fast.
Dani knew that most people, especially new-millennium kids, put a premium on taste and their families are not averse to it. As frequent consumption of tasty but unhealthy junk foods often leads to long-term health hazards, WickedGud was launched to reverse this trend. It aimed to ‘deconstruct’ the junk and empower ‘moms’ with various fresh, nutrition-rich and delicious foods to keep their kids and families healthy.
But the first experiment failed.
The startup initially launched gluten-free pasta, but it was not accepted by Indian consumers who want a balance between taste and health. So, the brand discontinued the product, tweaked the recipe and added some whole wheat to improve the taste.
WickedGud made considerable progress, but raising funds from Venture Catalysts++ was a turning point in its growth journey. The funding happened twice – INR 1.15 Cr in July 2022 and INR 1.5 Cr in December 2023.
“Venture Catalysts++ has played a pivotal role in our journey. Their strategic guidance and unwavering support have propelled our growth, helping us innovate, expand, and create meaningful impact in the industry. They’re not just investors; they’re invaluable partners in our success story,” said Dani.
After a second round from VCats++, the brand is all set to expand its global reach.
WickedGud’s USP: Innovation, Tech & The Quality Edge
The world may be awash with junk foods, but with the rise of mindful eating, where consumers search for functional foods and better ingredients, the healthy food segment is coming up in a big way. In fact, small food brands all over the globe are hoping to ride innovation, nutrition and food safety to corner big successes.
WickedGud is no exception. It brings in high-quality ingredients and creates perfect recipes for taste and health. The brand makes food healthier by adding essential nutrients, weeds out allergens to ensure food safety and sticks to sustainable preservation techniques for long shelf life. One of its R&D advisors is Rinka Banerjee, who had been at Hindustan Unilever (HUL) for more than 15 years – her last role there was that of the director (R&D) of the food division for Unilever’s South Asia business.
Its popping techniques and SCAD technology ensure zero-palm oil food processing throughout product development. While this reduces fat, net carbs and calories, it helps retain nutrients and flavours, making every product taste better.
The brand has tied up with multiple contract-manufacturers across the countryand follows a seven-point quality monitoring programme to ensure food safety and overall product excellence. Infact, some of their contract manufacturers are also investors – showcasing their trust and bullishness on this category and the management’s ability to execute.
Food samples are subjected to quality assurance tests for nutritional evaluation and sensory analysis, besides removing chemicals, microorganisms and common food allergens. The brand works closely with various NABL accredited labs to ensure they are fully compliant with local and international guidelines. Additionally, a sensory analysis is done for look and feel, taste, smell and flavour for consumer-level food acceptance.
Next comes packaging inspection or a thorough review of packaging materials to prevent contamination and retain product freshness. The brand also follows labelling compliance, clearly listing ingredients, their quantities, nutritional data like calorie contents and more to help consumers make informed decisions and rebuild their trust in food.
WickedGud’s Road To Omnichannel Success
True to a classic D2C brand’s sales strategy, WickedGud pursues online and offline retail to reach ‘woke’ consumers looking for healthy, hygienic and sustainable foods. It has already created a niche in the plant-based fast-food market by introducing a variety of products and categories, thus catering to people’s evolving preferences.
It has set up a flagship #NoodleBar at the newly-launched Reliance Signature Plus store at Infinity Mall in Andheri and will soon launch Korean-flavoured instant noodles, cup noodles and chocolate spreads in the market.
“Our strategy for creating new products and categories is based on thorough market research and a deep understanding of our consumers’ needs. We analyse market trends by actively engaging with our audience through surveys, social media and customer feedback,” said Dani.
Although WickedGud is present on major ecommerce and quick-commerce platforms such as Amazon, BigBasket, Blinkit, Swiggy Instamart and others. 40% of its online revenue comes from its own website.
It is now present in over 2.5K outlets across the country, which contributes to approximately 50% of its topline.
Again, 60% of its offline sales come from Tier I locations, but Tier II and III markets are rapidly catching up with 40% of offline sales. Its website also caters to non-metro markets (Tier II and III), while online marketplaces mainly cater to Tier I consumers.
A close look at the offline-online sales ratio and market distribution speaks amply about WickedGud’s growing popularity across the country. The brand says its popularity has spiked after emerging as a Shark Tank India finalist and claims to have sold over 2 Lakh packs of its healthy chips in three months after the product was launched in December 2023. The momentum continued, and in February 2024, it sold 20K packs of pasta, 70K packs of noodles and nearly 60K packets of chips.
“For D2C brands like ours, an omnichannel presence is key. It expands our reach, enhances brand recognition and caters to diverse customer preferences. Further, we provide convenience, gather valuable insights and create a seamless customer experience,” the founder added.
WickedGud mainly uses Meta and Google for online marketing and participates in pop-up events and exhibitions for offline promotion.
The Rise Of Healthy Foods: Too Many Hurdles Ahead?
Ask industry experts if the post-pandemic period is a phenomenal time for food entrepreneurs, and the answer would be yes and no.
For starters, investments have continued flowing into small companies with innovative product lines (some even flaunt family recipes) as there is a growing obsession for healthy foods against the backdrop of a global health crisis and rising consumer awareness. India’s healthy food market is estimated to reach $30 Bn by 2026, growing at a 20% CAGR.
Given that the health and wellness-focussed F&B market in India accounted for just 11% of the country’s $88 Bn packaged foods and beverages sector in 2020 and the number of health-conscious consumers is likely to rise to 176 Mn in 2026 from 108 Mn when the pandemic hit, there will be huge headroom for growth for the likes of WickedGud, Slurrp Farm, Open Secret, The Whole Truth Foods, Suzu Agro, Healthy Master, Delicious Bites, Indulgence and many more.
A combination of other factors has also changed the healthy foods business. Imagine how much it would have cost new brands to get a prominent shelf place before the D2C deluge. Now, new product lines are sold via marketplaces or directly to consumers, while brand identities are creatively built from scratch on the ubiquitous social media. Even brick-and-mortar stores of all sizes and glam quotients are ready to accommodate small lots and batches in their product mix, a boon for omnichannel D2C brands like WickedGud.
However, most are worried about the 3Cs – cost, competition and confusion rising from a surge in brands, overwhelming consumers with their claims to health and wellness in the F&B space.
Ask Dani, and he will confirm that the volatility of the ingredients market, especially commoditized ingredients, keeps pushing the costs. So do R&D and tech innovations, without which no brand can stand tall. Overall, scaling up fast would accelerate expenditures, but WickedGud wants to focus on retail expansion (read targeting 10K stores by 2026), a robust distribution system and unit economics to grow sustainably.
Others are worried about competition, with deep-pocketed FMCG brands barging into the healthy foods space. Tata Consumer Products (TCPL) and ITC have already entered the plant-based meat segment and are exploring more options. Industry leaders like HUL, Nestlé, and Marico will also go all out and grab this opportunity.
Eventually, it will be all about making a difference for the health-conscious masses, one product at a time. Deep down, it could be about battling the traditional fast-food industry, which serves not-so-healthy foods and changing age-old food habits and mindsets.
