In 2008, two friends started selling momos from their garage in Kolkata
14 years in, the entire nation is literally addicted to their chilli chutney
They turned a â‚ą30,000 loan into â‚ą2125 crores in the process
Here's how they built Wow Momos:
14 years in, the entire nation is literally addicted to their chilli chutney
They turned a â‚ą30,000 loan into â‚ą2125 crores in the process
Here's how they built Wow Momos:
First, let’s understand the industry to get the macro view and see where this FSI is headed.
FSI is segmented into quick restaurant services (QSR), Casual Dining Restaurants (CDR), Frozen foods, Fine Dining Restaurants and Pubs, Bar, cafés and Lounge (PBCL).
FSI is segmented into quick restaurant services (QSR), Casual Dining Restaurants (CDR), Frozen foods, Fine Dining Restaurants and Pubs, Bar, cafés and Lounge (PBCL).
QSR and CDR occupy more than 70% combined market share.
The FSI is very fragmented where unorganized stalls take up the larger pie. You see the food stalls nearby your place. Yes, they occupy >50% of the market share.
The FSI is very fragmented where unorganized stalls take up the larger pie. You see the food stalls nearby your place. Yes, they occupy >50% of the market share.
So, the organised players have the larger room to mould consumers’ lifestyles and develop their appetite and needless to say, they have been doing this exact thing during Covid.
After covid, people tend to order from hygienic places and trusted brands.
This gave these organised players an edge. Almost 30% - 40% weaker & unorganised FSI players closed permanently.
This gave these organised players an edge. Almost 30% - 40% weaker & unorganised FSI players closed permanently.
FSI is expected to grow at 9% CAGR by 2025. And this is attributable to a variety of relevant reasons:
•Urbanisation - An increase in independent households and nuclearization has led to a shift in consumption patterns with greater consumption of outside food.
•Urbanisation - An increase in independent households and nuclearization has led to a shift in consumption patterns with greater consumption of outside food.
•Rising income levels - With rising incomes, you need more convenience. And hence, an easy lifestyle.
•Innovative offerings - The likes of food tech startups have made consumer’s life easy and convenient with internet penetration.
•Innovative offerings - The likes of food tech startups have made consumer’s life easy and convenient with internet penetration.
Now, at this point after a good enough background in the food industry, let’s see where WOW! Momos stand in this QSR segment.
WOW! Momos was started by two fresh graduates with a vision to start their own business and skip college placements.
WOW! Momos was started by two fresh graduates with a vision to start their own business and skip college placements.
Binod Kumar and Sagar Daryani sat together to ideate a brand that has the best quality products.
Between those brainstorming sessions, they always went back to having noodles/momos to prevent hunger pangs.
Between those brainstorming sessions, they always went back to having noodles/momos to prevent hunger pangs.
It is this time that struck them why not have places aka franchises that sell momos too as often we come across franchises of burgers or pizzas.
They first started by opening a kiosk in Kolkata. To start all of this, Sagar took a loan of â‚ą30,000 from his father.
They first started by opening a kiosk in Kolkata. To start all of this, Sagar took a loan of â‚ą30,000 from his father.
After seeing the success of their first kiosk, they opened a few more in the city and nearby places.
After 12 years of overcoming the teething issues of a growing startup, WOW! Momos raised â‚ą130 Cr from Tiger Global when at this time the company had ~318 outlets in 16 cities.
After 12 years of overcoming the teething issues of a growing startup, WOW! Momos raised â‚ą130 Cr from Tiger Global when at this time the company had ~318 outlets in 16 cities.
WOW! Momos have streamlined its kitchens making the start-to-end process more efficient.
They make 5,00,000 momos every day (which is quite a task) and work with hatcheries to maintain hygiene.
They make 5,00,000 momos every day (which is quite a task) and work with hatcheries to maintain hygiene.
What are the few business lessons from these two fresh graduates who decided to take a leap of faith and build something of their own:
Instead of waiting for the opportunity to strike your door, start to work on the idea that struck you first.
Instead of waiting for the opportunity to strike your door, start to work on the idea that struck you first.
Understand the dynamics of the industry to scale your startup.
Word-of-mouth marketing plays in your favour if you've got a good quality product as it will sell itself.
Word-of-mouth marketing plays in your favour if you've got a good quality product as it will sell itself.
So in all, we can say that riding this wave of changing food habits and growing appetite to consume outside food, WOW! Momos were able to capitalize on this.
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