Turning idli-dosa batter into gold: How PC Musthafa built a Rs 3,000 Crore legacy with iD Fresh Foods
After sliced bread, the best invention that could have happened for foodies was - readymade idli/dosa batter!
It could be a personal opinion but the tedious task of soaking rice and dal overnight, grinding it in a mixie and then keeping it for a couple of days for fermentation killed the craving for lip smacking idlis and dosas.
Miles away in Bengaluru, a businessman saw an opportunity and came out with a perfect solution - ready to cook batter.?
Enter iD Fresh Food! Initially, it began as a virtual kitchen, delivering pre-packaged meals. However, founder PC Musthafa later introduced the concept of selling idli and dosa batter under his brand, which significantly transformed the company's trajectory.
In the business-oriented podcast The Neon Show last year, he revealed,? "We Indians don¡¯t trust our packaged food. Anything in a package form is considered unhealthy. When we launched the product in the market, we were surprised, no one was willing to buy a package of batter. We started sending 100 packets to the market, and 90 used to come back."
Nevertheless, iD Fresh Foods experienced a surge in sales and established itself as a prominent name in breakfast foods. Musthafa emphasized that the brand's differentiation lay in its decision to avoid chemicals in its pre-made batter, a choice that resonated well with middle-class households.
iD Fresh Foods journey
The venture was started by Musthafa and his cousins from a 50 square feet kitchen in 2005. In 2005, the brothers recognized a promising business opportunity in batter due to high demand and unreliable supply. Combining the entrepreneurial spirit of Musthafa, who had experience in IT roles across various countries, with the grocery background of their cousins, they started small with basic equipment and a second-hand Scooty. By the end of their first year, they had earned Rs 8 lakh, and within three years, their revenue soared to Rs 50 lakh, marking a rapid and successful start to their business venture.
In 2009, iD Fresh Foods ventured ambitiously into Chennai, aiming to replicate its Bengaluru success in the idli-dosa batter market. Musthafa invested the company's entire savings of Rs 20 lakh to establish a plant. However, the venture failed as competitors were selling batter at much lower prices. After struggling for over a year, iD was forced to exit the Chennai market, causing significant financial strain.
As per a Forbes report, during this challenging phase, Musthafa drew strength from his team, comprising friends, family, and relatives from Kerala. Despite grappling with severe cash flow problems that led to delayed salaries and personal struggles like being unable to pay his son's tuition fees, Musthafa was profoundly moved by the unwavering loyalty and solidarity displayed by his team members. The daily carrom games they played together became more than just recreation; they symbolized the resilience and unity that upheld iD Fresh Foods during its most trying moments. These bonds reinforced the company's spirit and determination to overcome adversity and forge ahead.
Also Read:?Haldiram's Success Story: From Selling Bhujia For 2 Paisa Per kg To Rs 70,000 Crore Empire
PC Musthafa's first financial investment
On a podcast, CEO PC Musthafa recounted his journey from humble beginnings, where he took on odd jobs like selling firewood in his village. Saving diligently, he accumulated Rs 150, which he used to make his first financial investment¡ªa goat, which became the first asset in his family's possession.
Continuing to build on his savings and investments, Musthafa eventually traded up by selling the goat to purchase a cow for his family. The cow's milk provided additional income, enabling them to enjoy three meals a day, marking a significant improvement in their living conditions.
Through perseverance and prudent financial management, Musthafa eventually secured admission to the National Institute of Technology (NIT) and pursued a career in IT. In 2006, drawing on his experiences and entrepreneurial spirit, he co-founded iD Fresh Foods.
Inside PC Musthafa's dosa-idli batter empire
In FY21, iD Fresh Foods reported an operating revenue of Rs 294 crore, up from Rs 238 crore in FY20, and further increasing to Rs 522 crore in FY23. During this period, the company managed to reduce its losses from Rs 42.8 crore to Rs 32.88 crore, as per Forbes.
iD Fresh Foods operates five manufacturing plants located in Ajman, Mumbai, Delhi, Bengaluru, and Hyderabad. The company has raised approximately Rs 366.53 crore in funding, with notable investors including Sequoia Capital, Helion Venture Partners, Premji Invest, and NewsQuest Capital.
In terms of revenue distribution, around 43 percent of iD's revenue comes from batter products, 33 percent from parota, and 12 percent from dairy products.
iD Fresh Foods future plans
Looking ahead, iD Fresh Foods plans to expand its presence into Bahrain, Kuwait, and Qatar in the coming months. The company has significantly enhanced its manufacturing capabilities, producing approximately 1.1 lakh kilos of idli-dosa batter and 4 lakh parotas every day, establishing itself as a major player in the batter segment.
Muthafa¡¯s eureka moment at IIM-B
As the chief guest at IIM-B, PC Musthafa, CEO of iD Fresh Food Global, shared his journey, failures, and insights with the incoming class. Reflecting on his own graduation day at IIMB 17 years ago, where he was inspired by Mukesh Ambani's presence as the Chief Guest, Musthafa expressed his gratitude for being invited back to a similar prestigious event. He highlighted the honor he felt in addressing the new batch of future leaders, offering them three valuable pointers drawn from his experiences as an entrepreneur. He posted the video on his Instagram handle:
?According to HT, In 2023, self-made entrepreneur PC Musthafa's empire was valued at ?3,000 crore. Coming from a non-wealthy family background, Musthafa's journey involved diligent effort to co-found iD Fresh Foods, a company known for its production of idli batter and other food products.
