WTF is with Nikhil Kamath
Ep #22 | WTF are Craft Beverages? Nikhil ft. the Founders of Blue Tokai, Subko, Svami, and Mossant
Podcast summary created with Snipd AI
Quick takeaways
- India's craft beverage market is experiencing growth, driven by consumers seeking high-quality, locally sourced options beyond traditional mass-produced drinks.
- Founders shared personal anecdotes highlighting how their unique backgrounds and experiences have shaped their innovative approaches within the beverage industry.
- Navigating taxation and regulations is crucial for craft beverage startups, as understanding tax implications can significantly impact pricing and profitability strategies.
- Creating a strong brand identity through storytelling and authenticity is essential for craft beverage brands aiming to connect with consumers on an emotional level.
- Establishing effective distribution channels and partnerships with restaurants and cafés can greatly enhance market penetration and visibility for new beverage brands.
Deep dives
Exploring Coffee Shop Opportunities
Starting a coffee shop can be an exciting venture, with an increasing interest in specialty coffee culture among consumers. The discussion highlights the importance of understanding one’s target audience and offering a unique experience to stand out in a competitive market. Key considerations include selecting the right location that ensures high foot traffic, such as areas combining office and residential spaces. Moreover, establishing connections within the industry, such as engaging with potential suppliers and manufacturers, is crucial for a successful launch.
Understanding Personal Journeys
The podcast features personal stories from the speakers, emphasizing their diverse backgrounds and early influences that shaped their paths in the beverage industry. For instance, one speaker’s childhood experiences with coffee in Delhi and the gradual transition to specialty coffee reveal how personal narratives can inform business ventures. Another speaker recounts his journey from finance to launching a coffee brand, showcasing the multifaceted nature of entrepreneurship. These stories highlight how personal passion and experiences can lead to significant industry innovations.
The Role of Quality Coffee Production
Quality sourcing and production of coffee are central themes discussed in the podcast, emphasizing that understanding the nuances of coffee varieties, such as Arabica and Robusta, is crucial. The conversation touches on the impact of weather and climate on coffee production, particularly in India, where altitude limits the prevalence of Arabica. The importance of maintaining relationships with coffee growers and ensuring sustainability in sourcing are highlighted as integral to delivering a quality product. This focus on quality drives consumer trust and loyalty in a crowded market, making it imperative for new entrants in the coffee space.
Navigating Taxation Challenges
Taxation presents a significant hurdle for new beverage brands, particularly for those in the craft sector such as kombucha and tonic water. The discussion reveals that products containing sugar or carbonation have a high tax rate, impacting pricing strategies for new businesses. Startups must navigate the regulatory landscape to ensure profitability while maintaining competitive pricing. Understanding the nuances of the tax system can mean the difference between success and struggle, urging startups to plan their financial models accordingly.
Building a Unique Brand Identity
Crafting a strong brand identity is essential for standing out in a competitive beverage market. The podcast emphasizes the importance of storytelling and authenticity, suggesting that a brand must resonate emotionally with consumers to gain traction. Creators are encouraged to focus on unique selling propositions, such as fun flavor combinations or sustainable practices, to captivate the target audience. Establishing relationships with consumers through relatable stories and high-quality product visibility can enhance brand recall and loyalty.
The Importance of Retail and Distribution
Effective retail and distribution strategies are crucial to the success of a new beverage brand, especially in the quick commerce sector where immediacy is valued. The speakers share insights into the importance of building relationships with restaurants and cafés to secure placements for their products. A compelling tasting experience in comparison to competitors plays a vital role in getting shelf space. Therefore, investment in building a solid distribution network can lead to sustainable growth and greater market penetration for new entries.
Consumer Preferences in the Beverage Landscape
The evolving preferences of consumers are a recurrent theme, illustrating a growing demand for healthier beverage options, including kombucha and craft tonics. As consumers become more health-conscious, brands are urged to innovate by introducing flavors and ingredients that cater to these trends. Collaboration with local eateries and cross-promotions with personalities can boost visibility and introduce products to a wider audience. This shift towards health-focused consumption presents an opportunity for new brands to establish themselves in the market.
Challenges in the Beverage Industry
Listeners gain insights into the unique challenges faced by beverage startups, including sourcing quality ingredients and managing production costs. The podcast discusses the intricacies of manufacturing, from securing reliable suppliers to ensuring consistency in beverage quality. Founders share experiences of overcoming initial hurdles, such as cash flow issues and navigating industry regulations. The importance of adaptability and continuous improvement is underscored as critical for growth and sustainability in the competitive beverage landscape.
Leveraging Market Data for Growth
Market data is vital for making informed decisions, and the speakers stress the importance of examining industry trends and consumer behaviors. They emphasize keeping an eye on the competition and using analytics to adjust marketing strategies. Understanding local versus global consumption patterns can provide insights that guide product offerings and branding approaches. Entrepreneurs are encouraged to leverage available market research to innovate and stay relevant amid shifting consumer expectations.
Potential for Collaborations and Partnerships
The podcast highlights the potential for collaborations between beverage brands and other businesses as a strategic approach to growth. Partnering with restaurants, events, or influencers can enhance product visibility and introduce brands to new audiences. Collaborations should aim to align with values and visions to create a compelling joint offering. These partnerships foster a community-driven approach to business and can build credibility and trust among consumers.
India has long been a tea-drinking nation, but in recent years, a new wave of craft beverage brands has started reshaping the way the country drinks. Specialty coffee, kombucha, and premium mixers are carving out space in an industry dominated by mass-produced options. While the demand for high-quality, homegrown beverages is growing, breaking into this space isn’t as easy as it looks. Import duties drive up costs, fragmented supply chains make scaling difficult, and price-sensitive consumers often hesitate to pay a premium. Unlike mass-market beverages, where marketing muscle can drive sales, craft brands have to build awareness, educate consumers, and create demand from scratch. In episode #22 of “WTF Is” Podcast, Nikhil Kamath sits down with some of the biggest names in India’s craft beverage industry—Rahul Reddy (Subko), Matt Chitharanjan (Blue Tokai), Aneesh Bhasin (Svami), and Adithya Kidambi (Mossant). They share their journey of navigating regulations, shifting consumer habits, and competing with legacy brands to bring high-quality, locally made beverages to the mainstream. Resource doc: https://www.notion.so/Resource-Craft-Beverages-19d26a5adf3180b68f1adbbbd2eea2f5#NikhilKamath Co-founder of Zerodha, True Beacon and GruhasTwitter: https://x.com/nikhilkamathcio LinkedIn: https://www.linkedin.com/in/nikhilkamathcioInstagram:https://www.instagram.com/nikhilkamathcioFacebook: https://www.facebook.com/nikhilkamathcio#MattChitharanjan Co-founder of Blue Tokai LinkedIn: https://in.linkedin.com/in/mchitharanjan Instagram: https://www.instagram.com/matt_chit #AdithyaKidambi Co-founder of Mossant Fermentary LinkedIN - https://in.linkedin.com/in/adithya-kidambi-8866b1269 Instagram - https://www.instagram.com/kidambiadithya/ #AneeshBhasin Co-founder of Svami Twitter: https://x.com/aneeshb LinkedIN - https://www.linkedin.com/in/aneesh-bhasin-252b661/ Instagram - https://www.instagram.com/aneeshb/ Facebook - https://www.facebook.com/gentlemenlisten/ #RahulReddy Co-founder of Subko Coffee Twitter - https://x.com/rahulreddysc LinkedIN - https://www.linkedin.com/in/rahulgreddy/ Instagram - https://www.instagram.com/raah_hool Facebook: https://www.facebook.com/rahul.gurram.reddy/ Time stamps:00:00:00 - Intro00:01:48 - Matt’s Intro | Childhood & Family 00:05:13 - Starting Blue Tokai & Career Journey 00:07:29 - Adithya’s Intro 00:14:13 - Building Mossant 00:17:54 - Challenges in the Industry 00:20:05 - How big is Blue Tokai?00:21:39 - Aneesh’s Intro 00:25:36 - Starting Career Path leading to Beverage Industry 00:27:38 - Rahul’s Intro00:39:26 - Building Subko 00:42:40 - How are Subko & Blue Tokai different?00:47:54 - Hacks for a 25 year old to Compete with Subko & Blue Tokai00:50:30 - Cafe Offerings of both Coffee & Food00:58:09 - Waves of Coffee - Shift to Coffee01:04:27 - How Big is the Craft Industry in India01:10:21 - How to Influence the Crowd at a Coffee Shop 01:12:31 - Difference between Good & Bad Coffees 01:18:13 - Difference in Coffee Culture of India and USA 01:24:11 - Opportunities in Tier-2 Cities01:28:59 - Recent Consumption Trends01:33:21 - What’s Kombucha?01:41:28 - Difference of Flavour Palette in India and Abroad01:44:01 - Consumption Patterns in India 01:49:24 - Awareness of Kombucha as a Product01:58:21 - Craft Beverage Taxation Policies02:05:47 - Mossant’s Journey 02:09:27 - East Asian Beverage Markets02:10:12 - Building a Global Indian Beverage Brand 02:19:12 - How to Compete as a New F&B Brand 02:21:57 - Svami’s Journey 02:30:20 - Differentiating as a Tonic & Non-Alcoholic Brand 02:31:59 - Is Quick Commerce Sustainable in India? 02:41:12 - Svami, Mossant vs Schweppes 02:47:32 - Effects of Coffee as a Commodity02:49:13 - Steps to Starting a Cafe 02:58:07 - Learning from Abroad Beverage Markets 03:01:12 - Favourite Coffee Shops, Kombucha Brands, Non-Alcoholic Beverages 03:14:59 - Beverage Industry as an Investor #WTFiswithnikhilkamath
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