Fireside Ventures, which was incepted in 2017, has backed 33 D2C brands across the country. However, it now aims to venture into new spaces such as gaming and wants to double down on the menstrual and wellness space. BWBusinessworld spoke to Vinay Singh, Co-founder of Fireside Ventures, to understand its long-term aims, the code to excel in building a consumer-loved D2C brand, and its investment thesis.
When selecting a D2C brand to invest in, Singh says, “We look for brands that understand the consumers they are servicing and create products that are delightful compared to what consumers are currently consuming.”
Furthermore, he highlights that a new brand has to market its brand store-to-store, as 90 per cent of retailers in India are unorganised. He adds, “In the last decade, all the investment went into digital media and ecommerce. This new ecosystem created a very conducive environment for new startups.”
When To Go Offline?
After the pandemic and the digital boom, as the market stabilised, D2C brands are again adopting the traditional ‘brick and mortar’ model of business. While going offline, brands are garnering consumers’ attention and allowing customers to first try and then buy the products.
Decoding the D2C brand building strategy, Singh explains, “Your own website is a great sales channel, but more than a sales channel, it’s an experimental channel. You can receive feedback from consumers one-to-one, and you can run a lot of parallel experiments.” After evaluating the market and finding the best market-fit product, brands can venture into the offline space.
Partner To Co-founder
Last month, Fireside elevated three of its partners to Co-founders, including Vinay Singh. Commenting on the news, he said, “Fireside Ventures has now matured enough over these last six years. We believe now is the right time to institutionalise the fund and what it stands for. As partners and Co-founders, we are very excited about the opportunities that lie ahead in this space of tech-meets-consumer spaces.”
The startup ecosystem has been grappling with a funding winter that started in 2022. In the first quarter of 2023, startups in India raised just USD 2 billion, a decrease of about 75 per cent compared to the same period last year. Moreover, it is the smallest quarterly number in nearly three years. However, Singh believes that the D2C segment would not be hit as hard as tech and SaaS startups.
In late 2022, one of Fireside’s portfolio brands, Mamaearth, caused a buzz on the internet when it filed initial documents for IPO. When asked about exiting from the brand via IPO route, Singh said that as a VC firm, exits and investment is part of a fund’s journey, “We continue to be supportive of the brand.”
Fireside Ventures has done its fair share in backing and hand-holding D2C brands. Since its inception, it has rolled out three funds and has invested in notable brands such as BoAt, Mamaearth, Gynoveda, Supertails, Traya, The Sleep Company and FableStreet.
The VC firm now aims to venture into new spaces with its Fund 3, which raised around USD 225 million. Regarding deploying funds, Singh says, “We are a multi-stage investor. Typically, we write USD 1 million to 2 million checks initially. And as companies scale, we write four to five million checks, and subsequent rounds follow with investments of the same value. Therefore, this year, we aim to make seven to ten deals of one to two million each.”
As the consumption pattern post-pandemic has changed, Singh explains, “There is a component of consumption which is going to be virtual, and it will account for a fair share of expenditure. Hence, we are looking at gaming, virtual assets, non-fungible tokens.” Moreover, the firm aims to invest in menstrual health and wellness, fitness, healthcare, and hair care.
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