The 'Three Musketeers' Of Wildcraft
Entrepreneur explores the journey behind the brand.
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Ever wondered what it takes to build a brand? Well some real interest, loads of passion, like-minded people aka co-founders coming together, time for some pivot, shake it and mix it well till you get your desired brand in result. Well, that's how the story sums up for wildcraft. Entrepreneur explores the journey behind the brand.
Gaurav Dublish and Siddharth Sood, who studied management from the same institute (NMIMS, Mumbai), got their first jobs in Bangalore. Over a weekend, they chanced upon Dinesh, a mountaineer by profession, who took them on a fishing camp in Cauvery. The three of them got together to form an enterprise taking people out for expeditions. However, for the first seven years it was purely run as a hobby rather than a commercial entity. Dinesh, who is a mountaineer by profession, started this as a services company in 1998 out of a garage. Till 2007, none of them was fulltime involved in the business.
Eventually, in those seven years all three of them moved out of Bangalore and had global careers. Dinesh was in the US with National Outdoor Leadership School, while Gaurav and Siddharth worked with Standard Chartered and GE respectively. Sharing how the three moved it from a hobby to business, Siddharth Sood, Co-founder, Wildcraft, says, "The three of us converged in Bangalore over a period of six months in 2007 and discussed how we can scale this up commercially.
The most important call was this is going to be a product company. We see lot of scope in the outdoor product space in the country." Soon, they quit their global jobs and took the entrepreneurship leap.
Prior to that products formed a minuscule portion of the company contributing to only 20-25% of there venue. On the other hand, the services business faced an issue of scalability as getting certified people in India was not easy. They took a factory with 10 employees to start manufacturing. Dinesh who goes on a lot of treks, hikes, climbing mountains actually became the guinea pig practically testing all the products while Gaurav looked at marketing and sales and Siddharth focused on the operations side. Today Wildcraft employs close to 1800 people in its three factories across Bangalore and Himachal Pradesh.
As soon as they pivoted into product domain the biggest challenge laid in front was to develop the supply chain. In pre 2007, Dinesh was heading the product development side. Post 2007 they got designers on board.
Talking about initial HR challenges, Siddharth says, "We hired from NIFT and NID. But none came from the ruk sack background as that didn't exist, so we have practically homegrown the talent." Initially, they hired young people who were very-very passionate. Today, the company boasts of having 40 designers on board. "You can't bring a foreign backpack and replicate it for India. The Indian size, torso is very different," adds Sidharth about the challenges.
Today, Wildcraft handles a large value chain right from managing supply chain from import side, design and development to what material needs to be used. They also handle the product team which decides what kind of item needs to be produced and in-bound supply chain team which ensures what has been decided comes into the factories to manufacturer to outbound logistics.
A Mix Of Debt And Equity
The trio had limited savings from their previous jobs to fund the venture. Soon they were able to convince bankers even without any assets or mortgage but on the basis of profits.
On how they managed debt without any collateral Siddharth says, "In 2008-09 we were able to convince SIDBI, and Bank of Maharashtra saying that we are young entrepreneurs and pitched them the way people do to VCs. Luckily, those bankers took those calls on us." From 2008-2013 Wildcraft grew on significant amount of debt. They soon went from net sales of Rs 60 to 200 crore but to reach that level they significantly borrowed heavy debt from banks.
With a lot of debt on their balance sheet they thought of balancing it out through equity financing. Sequoia Capital came on board in September 2013 investing Rs 70 crore. On reasons of choosing Sequoia, Siddharth says, "For us the defining factors were the ticket size we want to raise, the kind of deals they have done and patient investment with no pressure on exiting." The equity raised for the 36 months cycle has now come to an end.
On being asked whether they are looking at another round, Siddharth says, "Our next funding round depends on the ticket size we want to raise. Whether we raise from Sequoia or anyone else, Sequoia will definitely be a participant in that round." On why they kept it so guarded with just one equity round, he adds, "Constraint of capital sets the right culture in the organization. Sometimes excess of capital can disrupt the culture and derail the organization. We are very cognizant of
Franchising And Distribution
From 2007-2010 Wildcraft was only in Bangalore. In 2010 it entered Delhi and Mumbai and in 2013 it entered Calcutta. Out of 140 stores in 65 cities, 110 are operated by the company itself while the remaining 30 are franchised. They boast of 4-5 partners who own multiple stores. This year the intent is to roll out 30-35 own stores and 15 franchised stores around 50 stores in all. From category perspective Wildcraft looks at gear, apparel and
footwear. Gaurav Dublish, Co-founder, Wildcraft says, "Today we have 3,000+ distribution points in place, which is across 550 cities. We have presence in etail through our own portal and brands like Flipkart and Myntra. We have institutional presence. We do business with clients which are made to order. We have 4-5 channels of distribution. So each and every channel has significant contribution. All of them are at 20%.Institutional, MBO, our own, etail," he adds.
There are no international stores yet but is looking at Colombo, Kathmandu, UAE and South East Asia in near future. On how they are doing at the international front Gaurav adds, "We have Wildcraft available in 150 distribution points in Middle East. Around 5-6% revenue will come from there within a year's time." On whether he wants to take the company public anytime soon Gaurav states, "We don't want to look at an IPO till 2020. We don't see the need. We need funds as one of the resources to scale up not the final destination."
This article first appeared in the Indian edition of Entrepreneur magazine (July 2016 Issue).