Startup is Tough Terrain

Assistance to a start-up or a small company by the state apparatus is negligible in India. In fact, most state governments have formed policies which generally favour large companies and end up preventing start-ups and smaller companies in accessing their markets, says Gurpreet Singh, Co-founder and Director of World of Brands (WoB).

The four Co-founders of WoB navigated obstacles pertaining to securing funding, untangling intricate state-specific tax structures, and operating within constrained distribution networks. Their deep ties to the alcobev industry proved instrumental in overcoming these challenges and in successfully building their company. Despite the challenges, in a short period, World of Brands has turned out to be an accomplished player, all set to step into the big league.

World of Brands presents an inspiring and interesting story of deep motivation and entrepreneurial courage to bring about a disruption in the existing liquor business scenario. As Gurpreet Singh shares, “Whenever we four Co-founders would meet on social occasions, our conversations would often veer towards the big gaps in the availability of good quality brands at certain price points and the different taste segments that were unexplored.”

These conversations eventually led to the creation of WoB with the intention to create a portfolio of enviable brands, each one created on the back of specific deep consumer insights and innovation. Over a short period of just 18 months, WoB has come up with Great Indian Gin and Disco Panda brands.

Navigating through Experience

The biggest challenge a start-up faces is in getting appropriately funded. Collectively, the 100+ years of relevant category experience that the Co-founders brought to the table gave a lot of confidence to the initial investors. “We were also able to navigate the complex tax structures and access the limited distribution networks through our personal category experiences. In addition to this, we also had access to world-class master blenders, master brewers, innovation hubs and suppliers of key raw materials, including flavours, as well as design houses, creative agencies, media buyers and PR firms, all of which were best-in-class,” Gurpreet adds.

This allowed them to not only create a viable start-up but also create the products and brands in the manner in which they wanted.

State Matters

It is not easy to manage red tapes in state governments which play a major role in regulating the alcoholic beverage industry in India. Governments put many restrictions, ranging from stipulating the minimum number of years of a company’s existence, a minimum turnover etc.

“This is counter productive to the free trade, to the fair competition environment which is essential to all business and to the push to ‘Make in India’ and the ‘start-up culture’ that we otherwise speak about,” explains Gurpreet.

Therefore, it was quite an exercise for the Founders to find those states where the policies would be in their favour in terms of marketing and distribution. The smaller states and UTs typically offer more favourable conditions for alcobev start-ups. Goa leads this by a mile and it should not come as a surprise that many alcobev start-ups and smaller companies base their operations from there.

“There are no tenure-based or turnover-based barriers in Goa and the ability to do business under a sub-lease license allows start-ups to operate from this state unhindered.

Even on smaller issues towards timelines for registration of new brands or the costs involved, Goa’s policies are very fair and favourable to alcobev start-ups and smaller companies. It is time other states took note of this and frame more favourable policies at their end as well,” Gurpreet states.

Building Brands

Launching a product is one side of the coin. Building a category in a demographically diverse market like India, especially for new categories like cider, seltzer, fruit wines, etc., is quite another.

Gurpreet observes that the demographically diverse market of India actually offers more opportunities than barriers. It creates multiple opportunities for the smaller taste segments which start-ups like WoB tend to zero in on.

“Creating new categories is always a time-consuming process and it requires a clear strategy on the RTBs (Reason to Buy). Adjacent categories can at times find a quicker acceptance as did wheat beer from the variety of craft offerings, as it was close enough to the existing beer taste. However, a seltzer the way it is offered in the US when it was launched here, did not find much acceptance,” he explains.

A startup or small company needs to keep aside at least 2-3 years of investment in the creation of a category or challenging well-entrenched category codes. “The investment on the category creation needs to be made in educating the consumers, conducting trials and building a strong marketing programme for the brand,” Gurpreet observes.

To read more click subscribe