Mathew Joseph’s fish exports business was prospering until the global financial crisis struck in 2008. The aftershocks of the recession that followed were felt across the world.
Kochi, Kerala-based 56-year-old Joseph’s fish exports business was on a downward spiral for the next two years. His savings and other assets were at risk as payments were delayed and he neared bankruptcy.
One evening at the dinner table, Joseph decided to talk to his wife and children about their fragile financial position. Until that point, the fish business was all about exports and never the domestic market.
“My wife asked me why we were procuring fish at a high price here and selling in low-priced overseas markets affected by the recession. Why can’t we sell them here at guaranteed high prices,” she asked.
Her questions made an impression on Joseph, who says: “It was a fact that while global markets were reeling under the shock (of recession), India’s economy was still holding up. It was just that India’s seafood industry was highly unorganized, but therein was our opportunity.”
The germ
The initial plan was to start offline stores in various cities in India. But soon Joseph figured the move would be tough to execute and sustain. Online businesses had just started to take off in India and he decided to try selling fish on the Web.
Joseph launched a company called SeaToHome.com in 2012, with three university students offering help with the software.
But as business picked up, the site became vulnerable. Often, the site would crash and Joseph couldn’t guide the students on the technology front. He didn’t have the means to hire a software firm to run the site and in 2014, the online business shut.
Enter Shan Kadavil, who was then the Chief Executive Officer (CEO) of gaming company Zynga in India. 45-year-old Kadavil was a serial entrepreneur who was the founding member or CXO at firms like Support.com, Dbaux, and Zynga and had the experience of taking many of these start-ups from the early stages to an Initial Public Offering on the NASDAQ.
Kadavil was a regular customer of SeaToHome and he wondered why he was not able to place orders on the site anymore. So, he decided to call Joseph.
“I asked him why I was not able to get my orders delivered. He told me that scaling the start-up, especially given the deep technology expertise needed, was a challenge.”
One day, Kadavil and his team of seven people flew down from Bengaluru to meet Joseph in Kochi. Later, they met a few more times and they could both sense a big business opportunity.
They got along well and decided that Kadavil will join as co-founder and CEO of a new venture named FreshToHome in 2015.
Early Days
“It was the right decision at the right time. We never had to look back since,” says Joseph. “We soon launched an app for fishermen to make things simpler.”
This is how the app works. If a particular fish is available in one harbour, the fisherman clicks pictures and enters details like weight and price. If FreshToHome wants to accept the quote, it will send a reply color-coded in green; if not, in red.
Organised entities still account for less than 1 percent of the market, says Kadavil. To be sure, it’s still early days yet. A report by consulting firm Redseer says India’s fish and meat industry is expected to achieve sales of $80-85 billion by 2024. FreshToHome founders estimate the market to be around $70 billion now.
The company has over 40 collection centres in India and is engaged across 400 harbours with 3,000 fishermen and farmers on a daily basis, shipping over 25,000 tonnes of fish and meat across 160 cities in India and the United Arab Emirates (UAE).
The backstory
Growing up in a village near Vembanad lake in Kerala, Joseph used to spot a black Ambassador car owned by a businessman in his village.
On his way back from school he used to see the respect the businessman received from the villagers.
“As a child belonging to a lower-middle-class family, I decided in my mind that I would want to be a respected businessman later in life,” says Joseph.
Of course, dreams are difficult to realize. Joseph became an accountant in a seafood company after his pre-degree days. Although the shift was from 9 am to 5 pm, he stayed back until midnight to understand the processes better.
The company management was impressed enough to make him a purchase manager, a job that allowed him to travel to harbours across India.
He was in that company for nearly 11 years when he decided to work on his dream of becoming a businessman. He took a train to Gujarat to meet Dhirubhai Ambani, the late founder of Reliance Industries.
“I just wanted to shake hands with him. I had no idea that he was living in Mumbai and landed up in front of his house in Gujarat. I had to return without getting to meet him,” says Joseph, who was still in his 20s at the time.
But that didn’t deter him from setting off on his entrepreneurial journey. He began as a supplier to seafood exporters in Kerala’s Aroor. After two years, he realised that exporters were delaying payments and that’s when he decided to start a seafood export company himself.
Shan Kadavil, on the other hand, had completed his schooling in the UAE where his parents were based. He later spent a fair bit of his early career in Silicon Valley as a programmer, CXO and serial entrepreneur. His passion for tech-led businesses took him to the top of the ladder at Zynga in India; the co-founder of Zynga, Mark Pincus, himself has invested in FreshTohome.
The Road Ahead
FreshToHome posted annual revenue of around Rs 1,100 crore in FY22 and a net loss of Rs 389 crore. It has targeted revenues of over Rs 1,500 crore in FY23.
The Direct-to-Consumer business has raised over $250 million in funding so far. The latest round of funding closed in February 2023, when it raised $104 million from Amazon and other investors, braving a tough economic environment.
“The plan is to balance growth with profitability,” says Kadavil. The company intends to use the newly raised funds to enter more markets in the Gulf Cooperation Council (GCC) region and also open more offline stores.
“We have plans to go for an IPO within the next three years,” he adds.
Note to readers: Germ of an Idea is a series about the origins of an entrepreneurial idea, and the initial uncertainty and eventual success the founders experience. The series hopes to inspire thousands of potential Indian entrepreneurs on the cusp of starting up, have done so recently or are currently in schools and colleges dreaming of founding their own companies..
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