October 17, 2017

Leading Indian condiments company Veeba Foods has successfully raised a $6 million Series C led by Verlinvest, the investment holding company of Anheuser-Busch InBev’s founders. The round also included Samaa Capital, DSG Consumer Partners, and new investor, Sixth Sense Ventures, with Verlinvest accounting for $4 million of the total round.

DSG is reported to have facilitated the investment through DSGCP Tyeb – a new funding vehicle launched at the beginning of September through which the firm can invest in follow-on rounds for some of the best companies from the portfolio of its first fund.

“This allows limited partners not in Fund I to gain exposure to tomorrow’s leading consumer brands,” Deepak Shahdadpuri, DSG Consumer Partners founder, told VCCircle upon the announced launch of the specialty vehicle. “DSGCP Tyeb is targeting a corpus of $20 million and it has already made a first close of $16 million….”

Incorporated in 2013, Veeba Foods is a leading condiment company in India with a “better for you” line of products. In an emerging market where food safety is a paramount concern, Veeba focuses on quality control, manufacturing its products in a world class ISO 22000 certified manufacturing facility. Begun as a B2B company, Veeba supplies condiments, sauces, and dips to some of the world’s leading quick service outlets and restaurants including Pizza Hut, KFC, Burger King, Taco Bell, Domino’s, and Starbucks.

Verlinvest manages 1.8 billion Euro (US$2 billion) in assets on a global scale, and has worked to build a significant presence in Asia, which now accounts for one third of the fund’s portfolio through 10 direct deals in India, China, and Southeast Asia. It was through a co-investment alongside Everstone in Sula Wines, India’s biggest winemaker, that Verlinvest met Deepak Shahdapuri, founder of DSG Consumer Partners. Verlinvest went on to invest along with Shahdapuri in Drums Food and Veeba Foods.

Founded in 2012 as an early stage investor, DSGCP is one of the first funds in India to focus on identifying and investing in innovative brands in the consumer market. Primarily, the company takes minority positions in unlisted companies with an investment horizon generally spanning between six and 10 years. The firm generally aims to be the first institutional investor in companies through commitments that range from $100,000 to $1 million each with the potential to grow to between $1 million and $5 million over the age of the investment.

This is the third $6 million round raised by Veeba – in October 2016 the company raised a $6 million Series B from Saama Capital and Verlinvest, and the year before, raised another $6 million round from DSG Consumer Partners and Saama Capital, according to Bizztor.

Veeba plans to use the funds from this round to support greater distribution for its retail business.

“The money has been raised for more distribution push, across the country, for our retail business,” Viraj Bahl, founder of Veeba Foods, told Live Mint.  “Within two years of starting our retail business we have been able to establish a national footprint and today we are present not just in the metro cities, but also in cities such as Ludhiana and Vellore.”

Rising disposable incomes, urbanization, and an increasing openness to Western cuisines is driving growth for the condiments and sauces market in India, according to Euromonitor. And according to the India Table Sauces Market Overview released by Research and Markets last year, India’s table sauce market is expected to see a compounded annual growth rate (CAGR) of 18 percent to 2022. This popularity is only expected to continue to grow along with greater demand for international cuisines in India.

-Lynda Kiernan