Meat startup Licious becomes first Indian D2C unicorn with $52 mn fundraise

Licious, India’s largest tech-first full-stacked D2C (direct-to-consumer) fresh meat and seafood brand has raised $52 million in a funding round led by led by IIFL AMC’s Late Stage Tech Fund. The funding has made it India’s first such D2C unicorn or a startup with over $1 billion valuation.

Avendus FLF (Future Leaders Fund) has also invested in this round. Avendus Capital acted as the exclusive financial advisor to Licious for the transaction.

Licious is now the 29th unicorn to emerge out of India in 2021 amid a funding boom. The funding would help it to compete better with players such as FreshToHome, Zappfresh as well as large players such as BigBasket and Swiggy.

Vivek Gupta and Abhay Hanjura, co-founders of Licious said that in the coming years Licious will work towards building a sustainable, responsible business that will reimagine the animal protein category in India through an optimal mix of global influence and products curated for the Indian palate.

“But most of all, you will see us championing the cause of fresh meats and seafood sector as we continue to put it in the front row of consumer businesses in India,” said Gupta and Hanjura.

Even though the funding for D2C sector has grown significantly, they said that FMCG is still not considered the most attractive category.

“We expect that Licious’ unicorn status will change that,” said Gupta and Hanjura.

The fresh meats and seafood sector is still largely underserved and unorganised that holds a vast opportunity of $40 billion. As the category leader, Licious said it aims at paving the way for the second wave of young start-ups that can join hands in fully harnessing the potential that the industry has to offer. The firm said it will continue to build the category through investments in technology for supply chain excellence, product innovation, talent, and vendor partner upgrades.

The D2C market in India is at an inflection point and is expected to attain a size of $100 billion by 2025. The pandemic has played a major role in accelerating growth for the sector. Despite this, the sector failed to produce a unicorn until Licious.

D2C has the obvious advantage of direct consumer connect that helps them identify gaps and position their products accordingly. However, they also must go through the rigour of building a robust infrastructure that can sustain growth & enable quick scale-up. This needs a bottom-up approach and discipline from Day 0- a rare accomplishment that Licious was able to unlock.

The company said the achievement of its unicorn status is expected to not only further the journey of the brand but unlock the next level of opportunities for the animal protein sector. This would be through an inflow of investment, talent and the emergence of more start-ups that will help raise the bar in all aspects.

Chetan Naik of IIFL AMC, said that Licious has disrupted the meat and seafood category, which has largely been unorganized and underserved. He said Licious led by Vivek Gupta and Abhay Hanjura have demonstrated high levels of customer-centricity and an unparalleled focus on supply chain necessary for a perishable product.

“Licious’ focus on product quality, freshness and innovation has created a strong brand making them the undisputed category leader,” said Naik. “Today, Licious is amongst the fastest-growing D2C brands and is one of the few consumer businesses in India with very strong revenue retention metrics.”

Earlier this year, Licious allocated ESOPs to over 1000 employees including the blue-collared workforce. This was followed by a buyback worth Rs 30 crore, in Aug. The company also recently announced their pledge to comply with the global ESG (environmental, social, and governance) standards, setting new benchmarks for sustainability & governance. Spread across 14 Indian cities, the company has experienced an unprecedented growth of over 500% that the company saw during the last year followed by the continuing momentum of the same. Licious has successfully delivered to more than two million unique customers to date.

In July 2021, Licious raised $192 million in their Series F funding round, led by Temasek and Multiples, making it the highest-funded company in the fresh animal protein business category. Brunei Investment Agency also participated in the round along with existing investors 3one4 Capital, Bertelsmann India Investments, Vertex Growth Fund, and Vertex Ventures Southeast Asia and India.

Licious was founded by Abhay Hanjura, a Bangalore University science graduate along with his friend Vivek Gupta, a chartered accountant, after having a poor meat buying experience. After successfully testing its technology and business model, Licious launched its service in 2015. Same year, it received an undisclosed investment from former top Infosys executive TV Mohandas Pai along with Kanwaljit Singh, co-founder of venture capital firm Fireside Ventures. At that time the venture enabled customers to place the order through an app, web and telephone call.

Licious now serves over 1 million orders every month with over 90 per cent repeat consumption across markets. It is now a 3500 members strong team with employees, across different disciplines and functions.

It is present in raw and fresh meat and seafood, marinades and ready-to-eat categories. Licious said it is set to disrupt every food category. In a highly underserved market, which is estimated at $40 billion today, Licious said it has been able to solve the prevailing customer pain points of quality, hygiene, freshness and convenience in a sustainable manner.

Built on the farm to fork business model, Licious controls the entire back-end supply chain powered by stringent cold chain control to maintain the quality and freshness of each product. This starts from the time of procurement, processing, storage to the time it reaches the end consumer.

In just 5 years, the firm has witnessed a 300 per cent growth and has served over three million packs of world-class meat products to consumers across Bengaluru, Hyderabad, NCR, Chandigarh, Mumbai, Pune, Chennai, Jaipur, Coimbatore, Kochi, Puducherry, Vizag, Vijayawada and Kolkata.