How the humble Samosa is getting a QSR revamp

Samosa is arguably the most popular street food in India. India’s favorite tea-time snack is transitioning from the neighborhood halwai to well-fitted and hip QSR stores, driven by Bengaluru-based food startup, Samosa Party.

Amit Nanwari, a foodie and hardcore samosa aficionado, started Samosa Party in 2017 to improve the quality and experience of consuming samosas from roadside vendors. After spending the entire day at the office, he started selling samosas after his day job. He used to sell 200 samosas per day in just a couple of hours, and that’s when he noticed the immense potential for the snack segment. Samosa Party was launched to disrupt the experience of India’s most consumed snack. Soon, Diksha Pande came onboard after spending a decade working at Oberoi. The duo aimed to build a new-age global QSR brand out of India for the world. While discussing QSRs in India, the co-founders realized that all QSRs in India were foreign brands and Indian street food always remained unhygienic and pedestrian in nature.

“The idea came when we were discussing QSRs in India and realized that most outlets in India were American, while our street food always remained unhygienic. So, we decided to create a truly India QSR and Samosas was a unanimous choice,” said Amit Nanwani who heads the product, technology, and growth divisions at Samosa Party.

Covid-19 compelled the startup to pivot towards a delivery business, but the startup is now going all guns blazing on offline expansion. Samosa Party recently opened two offline stores in Bengaluru in May and has plans of increasing store footprint in the next few months. They have operations in Delhi, Bengaluru, Gurgaon, and Hyderabad.

The Indian QSR market clocked growth of 17.27% from FY 2016 to FY 2020 and is expected to reach about Rs 826.37 bn by FY2025. “Snacking is an under-penetrated category in India, especially for QSRs serving Indian food. There are a plethora of brands serving burgers, pizzas, tacos, waffles etc. but not one qualitative brand serving quality Samosas and Indian food at par with International QSRs,” said Pande, who presides over operations, people, and customer experience at Samosa Party.

Recognising the potential of the business, the co-founders initially invested their own capital and scaled the business to about Rs 6 crore a year turnover. Samosa Party raised about Rs 2.5 crore from the angel investment platform, Inflection Point Ventures (IPV) in June 2020 and went on to raise Rs 15 crore from Kalaari Capital in December 2021.
"In a brief span of time, Samosa Party has become India’s go-to brand for samosas. Homegrown brands like them are rapidly disrupting the QSR segment, traditionally dominated by global brands like Domino's, KFC, McDonald's and others. With democratized distribution and product innovation, we believe there is an opportunity for massive Indian QSR brands to emerge in the years to come," says Vani Kola, Managing Director, Kalaari Capital.

The company says it is targeting the $3.65 billion unorganized samosa market and has tripled their size in terms of stores and revenue by 3x in the last 100 days. The company is set to grow to 100 plus locations in the next four months. Serving about 1 lakh orders per month across Bangalore, Hyderabad, Gurgaon and Noida, Samosa Party has 45 outlets and a monthly revenue of about Rs 3 cr. They are currently producing and selling around 6 lakh samosas per month and have ambitious targets to sell 2 lakh samosas per day in the next 18-24 months and take their revenue run rate to Rs 300 crores. “We will scale and penetrate deeper in markets where we are present in the next 24 months and scale to over 425 stores across Bangalore, NCR, Hyderabad and Chennai,” said Pande.

Vamshi Reddy, Partner, Kalaari Capital adds that food & beverages are the largest retail category in India, with D2C brands addressing several white spaces in the market. “Nearly 60% of India’s food services market is currently unorganized, comprising a $40 billion street foods market. The snacking market is largely fragmented with 75% of demand still favouring local stores. However, this is expected to shift in the next five years with the emergence of food chains. We believe Indian QSR is at a tipping point, with changing consumer behaviour and growing appetite for quality street food at convenience. Since our investment they have more than tripled their footprint, substantiating our hypothesis on the potential of popular Indian snacks like Samosas to achieve scale with efficient operations and rollout models," says Reddy.

Samosa Party is banking on the evolution of the Indian QSR brand and proliferation of desi tastes to propel its growth. “Our products are very contemporary and are made for new India. Innovations like Samosa Buckets, freshly made samosas on order, different varieties, and a regionalised menu are all disrupting ideas,” add Nanwani. The duo says the company’s vision is not to remain just a snack brand. With almost 60% revenue coming from lunch, dinner and breakfast, they want to create an entire gastronomic experience around samosas.