Billionaire vaccine maker Cyrus Poonawalla’s son Adar has made his maiden investment in India’s food service sector by acquiring a stake in Sweetish House Mafia, a cookie speciality cafe, founded by former investment banker Neha Sethi and her brother-in-law.
A few years ago, Adar, CEO of Serum Institute of India, the world’s largest vaccine manufacturer, had acquired a stake in Pune’s Ritz-Carlton hotel. He has invested about Rs 12 crore in Sweetish House Mafia, which was started in 2013 with Neha, a self-trained baker, selling cookies in a Tata Nano at pop-up locations in Mumbai.
A year-and-a-half later, the partners set up the first brick-and-mortar store in Lower Parel, a business district in Mumbai. Currently, there are 12 outlets across big cities.
“The funds will be used to strengthen our presence in existing geographies as well as to enter new cities,” said co-founder Akash Sethi. “Some part of the money will be also deployed to expand our range of gourmet cookies.” The cookie business in India, worth Rs 14,500 crore, is growing at a compounded annual growth rate of 10%.
The Sethis are also planning to launch an e-commerce platform. “The coming decade will be dominated by direct-to-consumer brands. And investors are looking for models that stay relevant to consumers,” said an industry observer.
The food service sector has attracted over $3 billion of venture capital (VC) and private equity money in 12 years, according to a 2019 report by National Restaurant Association of India. Recent months saw VC firm RB investing in homegrown QSR chain Burger Singh and Tiger Global in Wow! Momo Foods. In 2017, ICICI Ventures invested Rs 100 crore in Theobroma Foods, a patisserie chain and a competitor of Sweetish House Mafia.