The Meatpreneurs: Building a De'Licious' Business
"We are not building Licious, Licious is building us," say the co-founders of Licious, Vivek Gupta and Abhay Hanjura
Every month, we at Entrepreneur India, feature one entrepreneur, who has done some remarkable work so far, on our digital cover. It is a video series that is close to our hearts. But, this month’s cover is even more special for two reasons. One, after a long gap of two years, we could finally do a physical shoot and two, we are not featuring one but two successful entrepreneurs this time - meatpreneurs, as we call them, Vivek Gupta and Abhay Hanjura, co-founders, Licious.
“We are two sides of the same coin,” Gupta tells us when we ask him about the kind of working relationship they share and the reason they often make media appearances together.
Taking it Slow and Owning Every Step of the Way
Licious was launched in 2015 when Gupta and Hanjura saw an immense opportunity in the animal protein category, which was hitherto untapped in the Indian market. In just six years, the tech-powered D2C fresh animal protein brand Licious, achieved a billion dollars valuation post receipt of funding worth $52 million led by IIFL AMC’s Late Stage Tech Fund in October last year.
Licious is also one of the few startups in the space that owns the entire supply chain. The company claims that every gram of meat sold on its platform is sourced, manufactured, quality checked and delivered by Licious. “In 2015, Gupta and I ordered a big lunch from a big place, but it didn’t taste good. We knew instantly that the only way we can truly put magic in it is when we own it. This was imperative because this is what consumers deserved in the context of the category. The problem in the category was of inconsistency and non-standardization. How do you solve that, that’s what we asked ourselves. A brand is the one that offers a consistent and reliable experience repeatedly," said Hanjura.
This was the genesis of Licious and there has been no looking back since then. “There was no other way to build a high-quality meat business until you make an impact on the supply chain. Licious didn’t carry the baggage of this industry. We started on a clean state, defined what a good quality of meat looks like and built the supply chain to deliver that quality," said Gupta.
The co-founders were not only sure of owning the entire chain but were also determined to take it slow and steady. That’s why even though they started the operations in Bengaluru in 2015, they moved outside the city, to Hyderabad and Delhi-NCR, only in 2017. “There was never any company or a supply chain to copy from as we were the pioneers in this. So, we took the time to learn it and we believed that it was long-term. So, doing it the right way was more important than doing it in a hurry,” said Gupta.
For Licious, taking it slow was something that its investors also wanted. “We didn’t have too many investors and those we had were learned people who were supportive of the fact that it was important to build the business the right way. Also, every city is a large market for meat as it is a high repeat business. Going deep and building repeat customers are important to drive the business and also from a unit economics standpoint,” said Gupta. Today, 85 per cent of the unicorn’s monthly business comes from repeat consumers.
Further, when Licious started out, the entire food industry was talking about frozen food as the future of the food and beverage industry. Frozen food has also been a popular category in developed markets for a long time now. However, Licious founders said no to it and spent their time and energy in the fresh food category. Explaining why they did so, Gupta said, “India has never adopted global food preferences. If you look at the data, 90 per cent of global innovations used in India have not worked. It may work in the fashion or automobile industry, but not in food.”
“Innovation was missing, it was either adulteration or frozen food. That is where startups like ours came in and challenged the status quo. The fact of the matter is in consumers' minds goodness is equal to freshness,” added Hanjura.
Veganism and Quick Commerce
Today, a lot of people are moving towards veganism. Many startups and celebrities have entered the meat alternatives space to cater to consumers who have turned into vegans. Do Licious founders consider it a threat? They say no.
“India's per capita meat consumption is very low, around 7- 8 kgs a year. America's is 100- 112 kg and China’s is around 62kg. We are far away from reaching some stability and then declining. We have to catch up first. And, per capita meat consumption grows as per capita income increases. As affordability goes up, people will consume protein. And, chicken is the cheapest source of protein. If someone’s health does not allow it, veganism becomes important. But these two are not clashing metrics,” said Gupta.
Having said that, Gupta is also sure that in case the trend picks up in India, they have an advantage over others in that space as well. “If it happens, we will be the first ones to provide such solutions to consumers because we understand meat well. We can offer meat alternatives really well."
Talking about the next bring trend today, which is quick commerce, Gupta said, “There are two shopping behaviors. One is a full month of larger purchase and then there is a top-up behavior. Top-up behavior is where quick commerce players are, which was earlier solved by next-door kirana stores. We have partnered with Swiggy, Zepto, Blinkit, Dunzo for some SKUs and we will continue doing that. But the whole behavior shifting towards quick commerce is far-fetched.”
“There is only a little impulse buying in our category and for that, we have our RTEs (ready-to-eat)," added Hanjura.
Life of an Entrepreneur
For Gupta, it was the need to stand out that sowed the seeds of entrepreneurship in him. Hailing from a business family, he wanted to break away from joining the same business and start something on his own. “In my family, everybody is in the family business. I didn’t want to be part of that umbrella. I wanted an independent identity. Entrepreneurship has changed me as a person," said Gupta.
Hanjura’s growing-up years were full of scarcity and he credits his entrepreneurial success to that. “When you learn to operate in scarcity, you can learn to operate in surplus and not the other way round. So fundamentally, scarcity is the headline of my childhood. That's why as an entrepreneur, whenever I see a downward curve, the tough notes that we hit, I know that it is temporary," he said.
The co-founders wear Licious t-shirts every day with pride and love the fact that the brand is more popular than themselves. “In 2015, when we started Licious, people said Vivek and Abhay have started it. Today, people say, there is a company called Licious and its founders are Vivek and Abhay,” said Gupta.
“We are not building Licious, Licious is building us. People love Licious and not us. The moment they see our t-shirt, they come and talk to us,” said Hanjura proudly, adding that when they put on their t-shirt and carry the bags, they also feel like they are going to school to learn something new that day.
While learning and work never stop for them, they do take out an hour a day to unwind and not think of work. While Gupta finds his nirvana moment in a game of badminton and in his kids, Hajura loves to cook and is currently taking music lessons. “I play around 20 days a month. That time I forget everything else. I also spend a lot of time with my children,” said Gupta.
What’s Cooking for Tomorrow
In the last six years, Licious has witnessed a 300 per cent growth and has served over three million packs of meat products to consumers across 17 Indian cities. Licious serves over 2 million orders every month with over 90 per cent repeat consumption across markets and is currently a 5000+ member team.
The brand plans to also focus on offline expansion going forward. “Fundamentally, technology is at the heart of the proposition. The way we look at offline is that it promotes the core Licious franchise. And, as we are thinking about offline, we are thinking about technology and look at that as a channel to build a loop around consumers in an omnipresent way,” said Hanjura.
In March 2022, it announced its Series F2 fundraise of $150 million. The funds raised through this will be utilized for investment in technological intervention that will help category development and improve overall customer experience. The company will also invest in strategic acquisitions and widening and deepening the brand's reach.