‘Truly pure’ is the mantra of this company. Can they ‘clean up’ the tainted milk industry?

Milk, the staple in indian diet has been in news lately, mostly for rampant adulteration in the industry and lack of hygiene during packaging. According to a national survey by the Food Safety and Standards Authority of India, 70% of the samples collected did not meet the required standards of food safety. While most of us, would see that number just a statistic and move on, an entrepreneur in Orissa is working towards changing that, inch by inch.

Milk Mantra, launched by Srikumar Misra in 2009, with its dairy products, is tapping into the Eastern India market, primarily in Odisha, Chhattisgarh and Calcutta and bringing about an impact with ethical milk farming practices. Excerpts of our conversation with the founder:

The idea of Milk Mantra

The untapped potential : After almost a decade in the FMCG sector with Tata Tea, including a short stint in London with the same brand, Srikumar moved back to India in early 2009 to pursue his entrepreneurial dreams. “My experience of several markets from emerging to developed, showcased the tremendous gap in the processed milk industry in India,” says this engineer, who also has under his belt, an MBA from XIMB and an executive program from Harvard. Of the 40 billion dairy industry across India, Srikumar says, a very small percentage comes from organized players in Eastern India. “The huge development potential presented itself, in the form of lack of innovation on both product and packaging front,” says the founder.

Impact the supply-chain linkage: Besides his own entrepreneurial endeavors, it was important for Srikumar to bring about an impact in his hometown which he is doing in the form of Milk Mantra and the various “extension services” that he is introducing in milk farming. The extension services, Srikumar tells us include training the farmers, tie-ups with microfinance institutions and banks for low cost loans, besides fair pricing and payment mechanisms. “We have a 24-hour helpline where the farmers can call for any complaints about anything in the system,” says Srikumar, who shies away from being called a ‘social entrepreneur’. “Milk Mantra is a commercial venture, and I am more inclined to the term ‘conscious capitalism’, our impact is integrated into the business model itself,” he insists.

Enduring and overcoming the challenges 

Challenges began from the word ‘go’. The focus of startups in India, be in terms of either a conducive environment to startup or the opportunities in the market are better in cities like Mumbai or Bengaluru. Even the investing community’s focus on mostly big towns also posed a big constraint for Milk Mantra to raise funds. Additionally, Srikumar was venturing out of the ‘darling sector’ for startups - technology. “Raising seed funding in Orissa, for an FMCG business that is so capital intensive, back in 2009, was really tough and it took us 18 months to raise the funds from investors in India and abroad,” says Srikumar. He raised his initial capital of Rs 5 million, which was utilized to buy land for the factory, set up the business, obtain regulatory approvals, and hire employees for operations including rolling out the ethical farming programme.

Besides funding, Srikumar says, competing on price points with the large number of subsidized government cooperatives, who are in a similar business is a huge challenge. Lack of adequate cold chains and difficulty in finding the right human resource have been the company’s other challenges. 

The potential for growth 

The company is confident of its product, which is the backbone of any venture’s success. Speaking of the packaging, which is the crux of their mantra of being ‘pure’, Srikumar tells us, “we have introduced a three layer pouch, that prevents sunlight penetration, the main cause of spoilage in milk products.” The company has also launched a range of fresh paneer and have plans to introduce other new products in the coming months. While their focus remains on product portfolio, they are also working to penetrate deeper into the markets in the eastern region.

The company today has more than 350 people working with them in various capacities, of whom around 150 are directly on the payrolls. Srikumar wants to take their current growth rate of half a million per month to 3-4 times that size in the next few months, but at the same time wants to keep his vision of nourishing a pure living to the farmers and consumers intact. 

The company recently concluded a second round of funding with their principle angel investors, Avishkar, and is raring to go. The success of Milk Mantra and advent of more startups from the north-east region trying to solve the problem of citizens of that region is very encouraging. Even the recent funding of Arohan Foods by Omnivore, is surely a proof of changing times since the time Srikumar moved back to India and struggled to raise funds for his venture.

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