Good times are ahead for the entrepreneurial ecosystem in India. After the government, the major FMCG companies are now supporting innovation through direct investment in startups by launching their dedicated accelerators and incubators.
The latest firm to empower the startups in India is the consumer goods giant Henkel. The German company has started an entrepreneurial program tilted Henkel X after its launch in Europe, the US and China.
Henkel launched its global edition of Henkel X in February 2018. It has held seven events under the programme so far. It has given 18 businesses a chance to build proof of concept business ideas with Henkel. It has also signed long-term business engagements with six startups.
Rahmyn Kress, chief digital officer at Henkel has informed that Henkel “doesn’t invest in these startups”. Instead, it gives them time, trust and data to build solutions and attract investment.
Being a consumer goods company, Henkel is keeping a strong focus on R&D, and is looking for companies in B2B technology, laundry and beauty products, and modern retail.
Henkel is in discussions with two Indian VC firms. The talks nay lead to Henkel making investments in startups either as a limited partner or as a co-investor in some round.
FMCG majors betting on startups
Millennial consumers are always digitally connected, and are very experimental. This has made brands explore how to scale faster with lesser investment.
Besides Henkel, other FMCG companies like Emami, Hindustan Unilever Ltd, and Marico have already been backing the next generation consumer companies. These companies usually have set up their venture arms to support the consumer startups via investment or mentorship.
In 2017, Unilever has backed a beauty startup Plum and SaaS firm Peel-Works. In January 2018, it invested in milk and grocery delivery firm Milkbasket through its venture arm Unilever Ventures. It has invested $10 million in IDG Ventures India (now known as Chiratae Ventures).
Emami has invested in two separate brands in male grooming startup segment. Marico has backed startups like Atomberg Technologies, Krishi Star, Incredible Devices and Zaya Learning Labs, through its innovation fund.