India’s problem with child malnourishment is well known. But the country also has a growing child obesity predicament; a study published in the New England Journal of Medicine in June found that India had the second-highest number of obese children in the world, after China.
Clearly, providing children with nutritious food is challenging. The task becomes more difficult when both parents are working, leaving children with little choice but to eat at lunch the food that might have been prepared in the morning or the night before. Long-time friends Sanjay Rao and Sandeep Kannambadi noticed this problem and ventured out to solve it two years ago, starting their journey in Bengaluru.
“Our country is facing massive problems with nutrition. While on one hand, India has 40% of the global underweight population, it also has nearly 9.8 million obese people, or 3.7% of the global population,” explains Rao.
The duo developed a technology-based food delivery platform called MonkeyBox to offer healthy and tasty vegetarian food to school children. The meals are designed by nutritionists and are delivered in lunch boxes just half an hour before the lunch breaks at schools.
MonkeyBox Food Tech Pvt. Ltd was incorporated in November 2015 by Rao, Kannambadi and Vijay Bharadwaj, all former staffers of tech giant Wipro. Prior to establishing, MonkeyBox, the three co-founders had founded a sports analytics platform called Sporting Minds in 2006, which was backed by Blume Ventures. The startup folded up in 2012.
The idea for MonkeyBox took shape in January 2016 through an experiment the founders ran. They delivered healthy food to 15 kids of their personal friends after preparing it with the help of a chef at a restaurant before 11 am in the morning.
As the children took to the food, word got around about their venture. By June, the founders decided to open their first kitchen at Uttarahalli in Bengaluru.
The demographics of Bengaluru have helped the startup. The city has a large population of working women, with nearly 40% of young engineers being women. The city also houses many double-income households from the IT sector.
“As more and more women are getting into work, it is becoming increasingly difficult for them to take care of their children’s nutrition. We are offering an easy solution. Once subscribed, parents don’t have to worry about what their wards are eating,” Rao said, adding that nearly 65% of subscribers’ parents belong to the IT industry.
In November 2016, the founders raised an undisclosed amount of seed investment from early-stage investor Blume Ventures. As per VCCEdge, the data research platform of News Corp VCCircle, Gana Yantrika Enterprises Pvt. Ltd, NB Ventures, Nspira Management Services Pvt. Ltd. and angel investor Atul Jalan also participated in the round.
By December 2016, the company was generating revenue of Rs 10 lakh per month and was breaking even at the kitchen level. “We had around 600 active subscribers and over 900 orders per day,” he said. The subscriber figures reached 1,200 by February 2017, Rao claims.
Nutritious food on an app
MonkeyBox delivers its nutritious, vegetarian food via an app, from which parents can choose from different packages for a varied number of days. “Parents can choose between lunch, breakfast and dinner, or all three, for five days, ten days or 22 days,” Rao said. A full subscription of 30 days for breakfast, lunch and dinner costs Rs 3,000. If a meal is not taken or ordered for, it can be utilised later and is valid for a lifetime.
Rao said the food is prepared in a very ‘hygienic’ kitchen, and then packed in lunch boxes. The boxes are tagged with each customer’s name and are then packed in colourful jute bags with bar codes before being loaded onto delivery vans. The food is delivered to schools exactly 30 minutes before the recess break.
“The food items are not repeated for the period of 22 days because children want variety in their food,” Rao explained.
Juicing it up
Riding on its success, Rao said that MonkeyBox started receiving requests from parents about beverages. “Parents were concerned that their children were drinking aerated beverages. They checked with us seeking to understand when and if we could offer cold pressed juices and other healthy alternatives,” Rao explained. This is when the startup decided to acquire Delhi-based cold-pressed juice manufacturer and delivery firm RawKing, he said. The deal took place in May this year.
Rao says that the company has been working on several new products based on RawKing and will launch a new re-branded beverages brand as an add-on service on the app by next month. “While we are still figuring out a name for the new range of products, the add-on will help us increase the average ticket size of a transaction executed on our platform,” Rao explained.
Currently, MonkeyBox has 6,000 subscribers and processes nearly 12,000 orders daily across south, east and northern suburbs of Bengaluru catering to almost 150 schools. Rao said that the company has been trying to cater to Bengaluru Central but has faced issues due to heavy traffic.
The company has four kitchens each with an average size of 7,000 square feet, where it employs around 165 people. “Each of these kitchens has roughly 38 employees, out of which 12 people are chefs and the rest aid in the delivery process,” Rao said. The company leases 30 vans in total from multiple vendors.
Each van driver, he said, is paid Rs 40,000 a month and a van can cater to three schools. “We always try to keep the travelling distance up to a maximum of 10 kilometres,” he said.
The company sources ingredients from Namdhari Seeds and obtains spices and dry foods from JeevaBhumi, an agriculture aggregator.
Rao claims that MonkeyBox is close to achieving profitability. “We are just Rs 5 lakh short of profitability. We are doing close to Rs 1 crore revenue a month. By February, we expect to be doing Rs 1.20 crore a month giving us at least Rs 13 lakh as profits,” Rao explained.
“If we are able to use the full strength of each kitchen which is 4,000 subscriptions, we will be doing at least Rs 2.5 crore to Rs 3 crore a month in revenue,” he said.
Rao also said that he was looking to raise an addition $5 million as part of a Series A funding round by January as he plans to expand to Hyderabad and Chennai.
The co-founder also said that he needed the new funds to set up kitchens in the two new target cities. “Setting up a new kitchen costs us at least Rs 1 crore,” he said.
“We are looking to close this round so that we can get everything ready before the start of the next academic year in June,” Rao said, adding that he was looking for a new financial investor.