Hector Beverages

Beverages and Energy drinks market in India:

While the size of total beverages market in India is about Rs. 1800 Cr,
only about Rs. 300-350 Cr. is the market for energy drinks. The energy
drinks market in India is growing at a rate of 25% per annum, as per an
article in Business-Standards dated February25, 2013.
Of the total energy drinks market, Red Bull controls about 80%.
Indian energy drinks market is unique as here energy-drinks market is
only about 0.8% of the carbonated drinks market, whereas globally this
ratio stands at 16%.

About Hector Beverages:

Industry: Food & Beverages

Specialties: Health Taste Beverages (Energy Drinks and other functional beverages).
Type: Privately Held
Headquarters: Gurgaon, Haryana, India

Values: The Firm believes in three core values which it lives by:
1. Audacity
2. Rooting for the Underdog
3. Integrity
Founded in: October, 2009

Founders: Neeraj Kakkar and Suhas Mishra

Key People: Neeraj Kakkar, CEO
Suhas Mishra, COO
James Nuttall
Neeraj Biyani
Location and Plants:
The startup has a manufacturing facility out of Gurgaon and is about to
start another plant in Mysore, Karnataka.
The Manesar, Gurgaon plant can produce 1,70,000 cases of 12 packs a
month, while the plant being established in Mysore will have a capacity
to produce 5,00,000 such cases.
Brands, Products and Target Groups:
It started out with Tzinga in 2011.

Later, the company decided to launch Paperboat.

Brands include Tzinga (three flavors- Mango Mint, Tropical Trip and
Mango Strawberry) and Paperboat (seven flavors- Aamras, Jaljeera,
Kokum, Jamun, Aam Panna, Imli, Golgappe ka pani).
Tzinga offers its energy drink at Rs. 25 for a pack of 200 ml, beating
hands down rival Red Bull which is priced at Rs.85-100.

 The tagline for Paper boat is Drinks and Memories.

While Tzinga was targeted at the youth, Paper Boat was introduced
with a 30 plus target audience in mind.
Hector has conceptualized several sampling activities for Paper Boat,
including one where it asks prospective consumers to make a paper
boat and if the consumer is successful, the company makes a donation
on his / her behalf to an NGO that supports childrens education.
The monthly sales of Paper Boat have crossed the 2 million mark.
As per Neeraj Biyani, Six months ago we were selling a million packs a
month but today we do close to two million in a month
Hector introduced a new 1 liter pack for Rs. 120. Rival Dabur sells a 1
liter pack of Aam Panna for Rs. 80.
Some more traditional, zero-calorie drinks in the pipeline include Sattu,
a traditional drink from Bihar, Tulsi tea, Ginger tea and Kaanji, a black
carrot drink originally from northern India.
Competition:

Red Bull is the ruling brand in this arena.

Then there are others in the market- from Coca-Cola's Burn, Goldwin
Healthcare's Cloud 9 and Monster Beveragess Monster to Pepsi's Sobe.

Reach and Roadmaps:

Today, it has a reach of about 7000 outlets through 15 distributors.
The company plan to reach over a lakh outlets within the next 18 months.
Tzinga has a fairly good retail presence in New Delhi and Bengaluru,
apart from progress being made in Jaipur, Jodhpur, Kota and
Hyderabad.
In Bangalore and other major cities of south India, Tzinga commands
the 2nd position in the market.
It has a partnership with Indigo Airlines to distribute its Paper Boat
brand on the airline. Later, Jet Airways started selling the product on
their flights too.
The next step according to Hector is to expand into some of the
neighboring countries, including Sri Lanka, Bangladesh etc.
They are also planning to launch an online shop next week and four
new flavors within the next three months, as per an article in Mint.
One of the biggest challenges before them is to convince small Kirana
stores for stocking Paper Boat.
Investments, News and Awards:
Infosys

founder

N.

R.

Narayan

Murthys

venture

capital

fund

Catamaran Investment Private Limited along with Footprint Ventures

and four other angel investors have placed their bets on Hector
Beverages, in its 1st round of funding.
Hector Beverages also raised $8 million from Seqouia Capital and other
existing investors in May, 2013.

 Hector Beverage was a finalist in the 2010 Wharton Business Plan

Competition.
In July 2013, Paper Boat was nominated for Kyoorius award for design
innovation.
Trivia:
Team strength of Hector Beverages is around 275 people.
With monthly sales of close to two million packs per month, it is
already disrupting the market for established beverages giants.
Co-founders Neeraj Kakkar and James Nuttall bumped into each-other
at their class at Wharton. Nuttall, later became Tzingas secret weapon
as the person behind its innovative and flexible packaging, bringing
down costs.
Hector Beverages, which expects to almost triple its revenue to Rs.100
crore in the next two years, has nearly doubled its sales in the past six
months, after it introduced Paper boat in August.