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How chef Sanjeev Kapoor built a business empire that is valued at over Rs 1,000 crore

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If you survive the first 1,000 days, reckons first-generation entrepreneur Sanjeev Kapoor, then you stand a good chance of flourishing in your venture.

“I am a banker’s son. Hamare se paise udaye nahin jaata (I cannot splurge),” confesses the food entrepreneur whose ventures are valued at over Rs 1,000 crore by his existing investors. Kapoor dishes out pearls of entrepreneurial wisdom as liberally as he shares recipes of popular dishes.

Like butter chicken: take 400 grams of boneless chicken, cut it into one-and-a-half inch pieces, add salt, one teaspoon Kashmiri red chilli powder, one tablespoon lemon juice… “There’s no secret recipe for success. You just need to keep things simple,” says Kapoor, who shot into the limelight in 1992 with his TV show Khana Khazana, which became the longest-running cookery show in Asia; it ran for 18 years.

Over the years, India’s most celebrated chef has alternated between being chef and entrepreneur with alacrity. His business ventures range from premium cookware and appliances brand Wonderchef to TV channel FoodFood to a chain of restaurants across India and abroad. Collectively, they rake in annual revenues of over Rs 500 crore.

How chef Sanjeev Kapoor built a business empire that is valued at over Rs 1,000 crore

“I have survived,” grins Kapoor, recalling how he launched Wonderchef in 2009 with Ravi Saxena, cofounder and former CEO of Sodexo India. Although he had turned entrepreneur with his first restaurant in Dubai in 1998, Wonderchef made Kapoor realise that serving up food and selling food equipment were two very different propositions.

“The revenue in the first year was pathetic,” he recalls, adding that the numbers were so minuscule that he thought it wise to forget the launch as a nightmare.

A La Carte
The business plan in the first year was simple: sell a threeset non-stick pan for Rs 8,000. The target was to sell 2,500 pieces imported from Italy. The mode of execution was to be direct-to-home, inspired by the model of Pampered Chef in the US. While the idea was great and inspiration was awesome, execution proved to be the Achilles heel. “2,500 pieces looked like 25,000. For the first time I realised how difficult it was to sell goods,” recalls Kapoor.

He then began looking for Plan B. Selling through television was one of the options explored. But the chef was apprehensive. Reason: negative perception of the goods sold on TV. Already the idiot box was flooded with sauna belts, massage mats and a rash of dubious goods. Selling high-quality kitchenware, he reasoned, might be difficult due to the well-entrenched perceptions of viewers.

How chef Sanjeev Kapoor built a business empire that is valued at over Rs 1,000 crore

Kapoor settled for a hybrid model: television along with the retail route by tapping into malls and shopping outlets. Many cautioned him against the retail route, including the then Tupperware India head Asha Gupta, highlighting the perils: operational costs would balloon, and the brand stood the risk of getting lost amid the clutter of the more established labels. “Much was at stake. I could not have let it go without a fight,” says Kapoor.

The hybrid strategy worked. After 1,000 days, Wonderchef clocked Rs 50 crore in revenue. In 2015, Wonderchef received Rs 30 crore funding from Zurich-headquartered investment firm Capvent. In April this year, the brand raised Rs 40 crore from French group Labruyere Eberle to fund a new manufacturing unit.

In the fiscal year ended March 2017, Wonderchef clocked sales of Rs 225 crore. “It’s a profitable brand,” claims Kapoor, adding that the target for 2020 is to double revenues and open 100 exclusive outlets across the country. The TV channel FoodFood, started in 2011, also came out of the red last year, he adds. In December last year, Discovery Communications called off a move to buy a majority stake in the food channel. While conceding that the channel has had issues in terms of execution, Kapoor maintains that things are back on track since he bought out his joint venture partners last year.

“If you have the guts to stand out, then the chances of your becoming outstanding are pretty high,” says Kapoor who, apart from running his own ventures, is the face of many brands, including Tata Sampann spices, dals and besan, Daawat rice, Ariel and Sugar Free.

Kapoor, say marketing experts, is a classic example of leveraging a personal brand to perfection. He first built himself as a celebrated chef and strengthened his equity. He then quickly extended his name to other businesses, but without diluting his brand. “Sanjeev Kapoor’s entrepreneurial ventures are an excellent example of a business empire built entirely on an individual’s personal brand,” says Miniya Chatterji, a brand expert. Talent, personal charisma, hard-nosed business development skills to sell his talent to India and the world, and, most importantly, the ability to take big risks with new ventures around cookery come together in chef Kapoor, she adds.

What also helped the celebrated chef in translating his popularity into moolah is his phenomenal social media reach. While Sanjeev Kapoor has 5.6 million followers on Facebook, his Twitter and Instagram reach stand at 1.7 million and 189,000 respectively. Add to these numbers his influence on Google Plus and You-Tube — 1.5 million followers, and 1.65 million subscribers with 330 million video views, respectively.

How chef Sanjeev Kapoor built a business empire that is valued at over Rs 1,000 crore

Full of Beans
Bakshish Dean, chief executive officer of Prime Gourmet, which runs American burger chain Johnny Rockets in India, points out that there are chefs across the globe who, like Sanjeev Kapoor, have created a business empire. Chefs such as Julia Child, Jiro Ono, Thomas Keller, Marco Pierre White, Wolfgang Puck and Jamie Oliver are some of the big names who successfully made a transition from chef to entrepreneur.

The risk-taking appetite, points out Dean, is what differentiates Kapoor from other chefs in the country. Kapoor’s decision to switch from being an active hotel chef to hosting a food show on television in the early 1990s was a big risk. “But it paid off,” he says. Having the right set of people in the team is also a big plus in creating a business empire, adds Dean.

In spite of the scale of his business, there are chinks in Kapoor’s armour. Lack of aggression is the biggest one, says brand strategist Harish Bijoor. Conceding that very few chefs have been able to replicate the intent to build a brand into a business that is robust and solid, Bijoor reckons that there is much more that Kapoor needs to do. “I see brand Sanjeev Kapoor flagging in intent,” he says. Kapoor needs to be more focused in his delivery and should focus on depth as opposed to wide exposure. “That is the inherent weakness,” he adds, emphasising that Kapoor needs to believe that his business cup is really only quarter full today. He needs to focus on deepening the turnover, says Bijoor, rather than frittering it on achieving width and eyeball mileage.

Kapoor, for his part, sees little wrong in his steady approach. “I don’t call it slow. I call it sure,” he says, pointing out the thumb rule of entrepreneurship: top line can’t grow at the cost of bottom line. “I am very conservative in raising money and debt,” he says, dishing out another analogy: one has to slowly chew the food, and not swallow it.

In the first 10 years starting 1998, Kapoor had opened only 18 restaurants. Over the next nine, the number jumped to 70. “We now plan to open 65 more,” he says, defending the pace of his growth. “It’s better to underplay and over-deliver than build castles in the air.” Now, that’s thought for food.

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