Daybreak - A new Indian startup is ditching the sportswear playbook to score a Puma-sized win

Episode Date: September 18, 2024

For nearly two decades, Abhishek Ganguly worked as the managing director of Puma, the German athleisure brand in India. In that period alone, the brand’s revenue shot up from Rs 20 crore to close to Rs 4,000 crore. Under Ganguly, Puma even managed to beat its longtime rival Adidas to become a market leader. In 2023, Ganguly decided to quit and start his own venture called Agilitas Sports with two of his colleagues from Puma, Atul Bajaj and Amit Prabhu. Within a year, Ganguly’s company has managed to rack up more than Rs 700 crore in revenue. The way Ganguly and his co-founders got to this point is interesting. Instead of doing the obvious thing and launching their own sneaker brand, Ganguly did something quite odd. Something, that even the biggest sportswear brands in the world – Nike, Reebok, Adidas – have never even attempted. Last September, Agilitas bought India’s largest sportswear contract manufacturer, Mochiko shoes. This is the company that manufactures shoes for international brands like Adidas, Puma, New Balance, Skechers, Reebok, Asics, Crocs, Decathlon  – the works. Ganguly’s logic behind owning the factory is simple – he wants whole  pie and not just a slice of the margin. He told The Ken's DVLS Pranathi that having the additional manufacturer’s margin in a price-sensitive market like India is worth its weight in gold. But there is a reason giants like Puma and Adidas don’t go down this road—taking care of manufacturing in-house is a logistical nightmare. That’s why most brands outsource to companies that are equipped to do it, like Mochiko. But Agilitas is dead set on bringing the entire operation in-house. It’s convinced it can work and has also managed to convince VCs that there is merit in controlling both manufacturing and distributing. Investors are betting on the Ganguly-Bajaj-Prabhu trio to pull off another Puma-sized victory. But will the other shoe drop? Tune in.**The host mistakenly said a decade instead of two decades when referring to Abhishek Ganguly's stint at Puma. The error is regretted.Fill in Akshaya's Happiness Survey hereDAYBREAK UNWIND RECCOMENDATIONS FOR COMFORT FOOD SPOTSRahel: Kappa Chakka Kandhari, Bangalore,           Unnamed food truck at Utorda Beach, South GoaSnigdha: Alu Dum from Bari's tuck shop near Loreto Convent, Darjeeling                Thukpa at Kunga's, near Planter's Club, Darjeeling                 Ghee Podi Dosa from Umesh Refreshments, Indiranagar, BangaloreSatyam: Litti Chokha, Jai Mata Di Food Stall, HSR Layout, BangaloreShayanika: Dosa and Puliyogare Rice at 3 Trees Cafe, Upper Dharamkot, DharamsalaRahul: Egg fried rice at Tenzin Kitchen, Koramangala Akshaya: Okonomoyaki and fried tofu sushi at Dahlia, Chennai

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Ramon Ganesh, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission. We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture,

how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing and extensive post-production. Sita and I are still reeling from the intensity of our first studio recording. Intermission launches on March 23rd. To get an alert as soon as we release our first episode,

please follow intermission on Spotify and Apple Podcasts or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. For nearly a decade, Abhishe Gungali worked as the managing director of the German at-leisure brand, Puma, here in India. He's basically the guy who made Puma cool again. And in that period alone, the brand's revenue shot up from 20 crore rupees to close to 4,000 crores.

Under him, Puma even managed to beat its long-time rival Adidas to become a market leader. And after putting Puma back on the map, Gangoli decided to quit and start his own venture with two of his colleagues from Puma, Atul Bajajaj and Amit Prabhu. In 2023, the three of them launched Agilita sports. Now, this is not a name that the average sports enthusiast would recognize. But what if I told you that in just a year's time, Gangoli's company has managed to rack up more than 700 crore rupees in revenue. And the way Gangoli and Coe got to this point is quite interesting. Again, this is a company run by veterans from the sportswear industry. They know the ins and outs of the space, what works and what doesn't.

But instead of doing the obvious thing and launching his own sneaker brand, Gangoli did something that was quite odd. Something that even the biggest sportswear brands in the world, Nike, Reebok, Adidas have never ever attempted. Last September, Agilitas bought India's largest sportswear contract manufacturer, Mochiko Shoes. This is a company that manufactures shoes for international brands like Adidas, Puma, new balance, sketches, decathlon, the works. Gangoli's logic behind owning the factory is quite simple.

He wants the whole damn pie and not just a slice of the margin. He said as much when he spoke to the Ken's reporter Pranati recently. He said having the additional manufacturers margin in a price-sensitive market like India is worth its weight in gold. Make sense. But, you know, there is a reason why giants like Puma and Adidas do not. go down this road. As you would imagine, taking care of manufacturing in-house is a logistical nightmare. That is why most brands outsource to companies that are equipped to do it like Mochaco.

But Agilitas is dead set on bringing the entire operation in-house. It is convinced that it can work and has also managed to convince VCs that there is merit in controlling both manufacturing and distribution. So investors are betting on agility to pull off another Puma size victory. But will the other shoe drop? Welcome to Daybreak, a business podcast from the Ken. I'm your host, Nick Dha Sharma,

and I don't chase the news cycle. Instead, every day of the week, my colleague Rahal Philippoza and I will come to you with one business story that is worth understanding and worth your time. Today is Thursday, the 19th of September. What Agilitas is trying to pull off is almost an anomaly in the sportswear industry. Gangoli wants to build a whole ecosystem.

He wants to take care of everything in-house, product design, manufacturing, distribution and brand building. Agilitas will own every step of that process. Now, this is unheard of because most sportswear brands design a product and then just slap a logo on it. They outsource everything else, especially manufacturing and hope that everything comes together right at the end. But Gangoli is not sticking to the old tried and tested sportswear playbook. This, of course, comes at a cost. Manufacturing is a huge drain on resources,

which is why, like I said earlier, other brands like Nike and Adidas don't even try to do it themselves. Here in India, brands like Adidas and Puma outsource nearly all their production. Mochiko's CEO Wyrinder Awal said that almost 70 to 80% of their products sold in India are made by local manufacturers like his company. The thing is, sneakers are not easy to make on your own. It takes multiple factories to produce a single shoe. One factory would handle moulds, the other will make soles,

and a whole different factory will stitch together the upper part of the shoe, which, by the way, has 38 separate pieces. It is a complicated business making shoes. But Gangoli, Bajaj and Prabhu are aware of all of these children. challenges. Which is why Agilitas did not start from scratch. Instead, it hit the ground running with the largest sportswear maker, which instantly gave it control over the whole process. Mochiko is not just stitching shoes together. It is one of the few manufacturers that handles everything, the full spectrum. From design briefs to soulmaking, stitching, assembly,

it all happens in-house. It churns out millions of shoes from its factories in-house. It churns out millions of shoes from its factories in Gurgao, Rishikesh, Deradun and Noida. This allows for better turnaround time and better inventory management. So, in essence, Agilitas is positioning itself to achieve what few Indian sportswear brands have managed. Lusting success. More on that in the next segment. Hello, daybreak listeners. This podcast you're listening to is produced from the newsroom of the Ken. And guess what? We have a lot of other podcasts. too. I'm Akshad Chandrshakran. I host the Ken's early careers podcast the first two years.

And I am on a mission to find out what makes people happy in their early career. Even if you're way past the first two years of your career, looking back, can you recall what had the biggest impact? Was it the job, the company, the people? What was it? Well, what if we asked the same question to dozens or even hundreds of people? and create a wealth of valuable experience, repository of knowledge from people of different backgrounds. What would that look like? That's exactly what we set out to do. We created a survey and we want to hear from you.

The link is in the show notes. I read and review 8 submission and might even have you on the show. I look forward to hearing from you. Now back to your daybreak. Typically, when a global brand starts selling products in India, it makes a few minor adjustments. Like in most cases, it will tweak its sizes and call it a day. But Agilatars is going all out. It is designing shoes and apparel specifically for Indian consumers.

It has assembled an all-star team to be able to do this. People from all over the world who understand the ins and outs of sportswear. They've been tasked with developing products using property tech to address the specific wear and tear of Indian conditions and accommodate a variety of foot types. For example, Indian feet tend to be wider with flatter arches. So Agilitas is incorporating wider towboxes and flatter soles to their designs. On the pricing front, Gangoli is positioning Agilatars as a high-value guilt-free splurge.

It is not targeting the low-end market. Instead, it claims to offer more value compared to Puma's shoes that cost up to 24. thousand rupees. Although Puma's shoes are often heavily discounted on platforms like Amazon and Mintra. And Agilitas is already putting in this strategy to the test with Lotto, the Italian Sportswear brand. It snagged an exclusive deal last April to design, produce and sell for Lotto. It will be able to target both premium and mass premium segments. Also, instead of copying Puma's strategy, Agilitas plans to operate multi-brand stores, offering. a curated mix of products.

The one thing that will really work in their favor for a while is the fact that post-COVID at leisure has become a staple for most people. And Ganguly is not losing sleep over what happens if this trend phases out. In fact, he believes this is just the beginning. Goldman Sachs seems to agree. A report by them in March highlights sports and at leisure as the biggest growth driver in the Indian footwear market. And a lot of brands are betting big on the shift entrance.

Metro, for example, which was once known for formal and casual shoes, is now shifting gears to the sportswear segment after securing rights to feeler. Then you have Aditya Berla fashion, which recently took a bet on Reebok. This sneaker boom in India has also spawned a handful of newer players like Comet and Soul Treads. Back at Agilitas, Gunguli's eyes are. set on launching two more category brands next year and maybe a third in 2026. But he's also cautious. Agilitas has already got the engine in Mochigo.

But to score a Puma-sized win, it will have to navigate a market that is now flooded with choices. Hi, please don't go because we still have the daybreak unwind segment coming up next. Stay tuned. Hello and welcome to yet another segment of. of daybreak unwind. It has been for whole weeks. I can honestly hardly believe it. I think our best decision yet as co-host Nickda has been getting a WhatsApp number.

Oh, that's so true. Because it's given us this amazing opportunity to get to know some of you to actually connect with you directly, you know, find out what you're listening to, what you're into. And honestly, it's just been awesome. Yeah, that's true. And that's the whole essence, right, of this segment when we came up with this idea. You know, for those of you who were tuning in for the first time, we kind of started this because we wanted to get great recommendations on Thursday.

Because Thursday is the day when you actually start thinking about the weekend. Yeah. And you start planning your weekend whether it's just being a couch potato at home or whether you want to go out. If you're staying home, you want to watch some interesting stuff or read something nice. Or if you're planning to go out, you want to, you know, maybe go to a nice restaurant or a cafe, right? So that's how we got started. Now we're here.

Yep. And this week's theme is really special to the both of us because we're going to talk about something that we absolutely live for. We're talking about food this week. More specifically, comfort food. What does comfort food mean to use, Dikta? Comfort food, for me, I think it's mostly to do with... It's not just to do with...

It's not just about the food in itself, you know. I think it's more about the memories and the nostalgia that is often attached. You know? Like, for example, even festival food, right? Like, for example, Sadiya. Yeah. What did you eat?

Where did you do? What did you do? Tell me. I had such a good sada. I went, I booked a week in advance. And a few of my friends and I went to this place in Bangal called Kappa Chaka Kandhari. They organized a sadiya in Kormangla. So great.

So great. I mean, having Sadiya is in Delhi. for the last couple of years. These guys knocked it out of the park. It was amazing. I was a very happy girl. Happy Onam listeners on that note. Yes, happy Onam.

Do you like Sadia? Yeah, it's been a while but I think the last Sadiya I had was in Delhi. And this time I was just looking at people's Instagram photos of Sadiya. That's why I chose not to post any photos of the actual Sadiya. I was like, okay, that's cruel. I'm not going to do that. That is true. What does comfort food mean to you, Roil?

I think like you, I associate food with a lot of memories. Also, yeah, again, like nostalgia, that sort of thing. You remember when we were kids and we'd read like Famous Five, Secret 7, Mallory Towers and all of that? Yeah. And you know how there'd be these descriptions of like picnics and schools and jam? Yeah, it was amazing. I remember reading those books. over the summer because of those very vivid descriptions.

And where would we have scones and all? I know, I know. Only now we get all these fancy things. Yeah. But actually, talking about Enid Blyton, did you know she was a racist? Oh, God, thanks. Okay, let's not go there, but... Just ruined Enid Bledon for everybody.

Oh, shucks, man. Okay, back to comfort food. Yeah. Rahil, why don't you tell us yours? Okay. my comfort food, for our listeners who don't know, my family lives in Goa. So when I'm not in Bangal, more often than not, I am in Goa, which unfortunately isn't as often as I'd hope. When I'm in Goa, you know, when the weather kind of allows for it, I try to make a trip to the beach in the morning with a couple of friends.

Early in the morning, we'll go for a swim and generally we'll go to a beach right next to where we live. But the odd chance that we're kind of feeling adventurous, we go a little further to this beach called Utholda Beach in South Goa. It's about 30 minutes from where I live. We'll drive down. It's a beautiful drive. And sometimes when the weather is just right, the water is so clear.

You can see like the bottom of the ocean. Stop it. It is so beautiful. I am. Go away. Go away. Happily with pleasure. But yeah, it's beautiful.

some of our happiest memories are there and this one time that we were at Utholda you know you're just wrapped up a swim really tired and like there's that you know that hunger that hits you after swimming that hit big time and we were just leaving we were walking towards the parking lot and there was this food truck

parked there very kind of unsuspecting food truck normal one guy was running it seemed nice enough you know so we walked up to him and we were there were all these like love you really aromas that were kind of coming. That fresh like poey bread smell. Oh my god I love poey bread. It's so amazing. It's such good

bread. Yeah. So we went and we randomly got a kaffriyal chicken sandwiches in poey bread like crusty poey bread and it was heaven. It was so good. Oh my god. So then the next I'm crying. And then then I just made it a point to keep

going back. Unfortunately I will not be able to give listeners a name of said food truck because I honestly have no idea. I know that it's run by a couple and it's on the, it's just the Uthoda parking lot is not that big. For those of you actually go there, it's like the parking lot next to the jamming goat. I don't know if there's too much information. I think they'll figure it out. Yeah. And if you do send us pictures on our WhatsApp number. Yeah. What about you think that? I want to hear your comfort food. You know our listeners are going to be so jealous of us. Because you're from Goa, I'm from Dajling, mountains and beach. It's too good.

It's too much. So my comfort food is actually aludam, me, me. Okay. Aludam is actually not the traditional aludam that you know. It's a very... So, Daazeling is a very cosmopolitan place, right? I don't want to get into the history of it, but a lot of different kind of... people and communities have settled down and d'arjling over the last 200 years or so, right,

because of the plantations like Tibetans, Nepalis, Biharis, Bengalis, Mawaris. So Al-Dam is a combination of all these influences. So it's basically potatoes, boiled potatoes in this really spicy red curry, garlic-kri with a lot of chili and some food color, which we loved as kids. And they top it with like, you know, Buzha like these, what do you call it? Is it like Bujah? Yeah, sort of like that, right? But the local one, not the Halid Ram type.

Like Sive. Yeah. Okay. That and you know those finger rolls? The fried ones? The fryms. Yeah, yeah, yeah. Crushed.

Okay. Topped with some imly chutney, tamarin chutney. Okay. Whoa. And so that is one version of it. The other one which I spoke about was all the Mimi. Mimi. Mimi's quite similar to Y-Y.

Okay. So you just like add crush Y-Y-Way on top. And oh my God, it is the most. So Dajing has these little tuck shops. Okay, so we had the school that I went to. We had one called Badi's Al-O-Dam shop, okay, tuck shop. Which is right above the school. So they only sell Al-Dam?

Yeah. And she used to sell Mommos also later on. And you know sweets and candies and, you know, stuff for kids. Al-a-dum is a street food. It's a proper street food and d'adjaling. So, yeah, so we would. As soon as school got over, we would just rush. And I remember we used to get it for like five rupees or something back in the day.

And used to be so spicy, so spicy. And we sometimes you can also add if you want more spice. There's this particular kind of chili that we get in Darjean called Dallet. It has this very, it's very fragrant. Yes. You got this to work and it's amazing. You know it. Yeah.

So it has this very Tabasco like fragrance, right? So you can add that and it's pretty spicy. Yeah. And I remember like, you know, eyes watering, nose running. It burns so good. It's so good. I love that. That's so cool.

I'm such a street food person, I know. Yeah. Yeah. I love street food. But also this, like, you know, this spicy in a cold place. Oh my God. Just hits different. It's so good.

And like we were talking about this a little while ago, but like food tastes so much better in the hills. That is true. I don't know what it is. If someone. can explain the science of that. Yeah, please. Actually, even fragrances. I was telling you about fragrances, right?

Like, yeah, you can smell flowers, trees, plants. Even perfumes, actually. Stay longer. Oh, really? Yeah. Oh, wow. Okay. Shall we get to our listeners' recommendations?

Let's do that. I am so excited. Great. Okay, so the first recommendation is from our listener, Satyam. Thank you so much, Satyam. Thanks, Satyam. Yeah, here goes. Hey, Snigda and Rahil.

I really enjoy listening to you folks every morning. I thoroughly enjoy the Thursday unwind sessions and it really gets me giggling while I'm driving to work, especially the part where Snikda rips apart Kalki and Rahil talks so openly about crazy movies. Now, on to my recommendation for this week, it's having Littie Chokha at Jemata the Food Zone in HSS layout. The Littie Chokha here is scrumptious and you can't stop it too.

So Littie Chokha is a delicacy from Bihar and the people cooking at this store are also from Bihar. So you get the authentic taste out here. Cheers. Rayl, do you like Littie Choka? I love Littie Choka. But I know you have very strong opinions on what a good Littie Choka is, right? Yeah. Yeah, so you know, Littie, which is the dough ball, which is served with chokha, which is basically mashed any vegetable, could be potatoes or began.

Like basically it's also served with Began Bertha. I don't know if you've tried that version. Yeah, I've only had that. I didn't know you could have it with something else. Yeah. I love it with mutton curry. It's amazing with that champaritan style matamari. That sounds like such a good combination.

Very good. But my problem is when the Littie is too dry. You have to douse it in tea. Yeah. So let's go to our next recommendation, which is from Shainika. Hi. Niemish Ayanaika and I'm sending this from Dharamkot, which is a tiny hamlet in Himachal Pradesh. And my favourite food these days has been dosas and Puliogray rice from this place called

Three Trees in Dharamakot, Upper Dharamkot. And yes, as an assamese to crave South Indian, it's a very happy feeling. And yeah, if you guys are around here, you should definitely check it out. Three trees, Tharamqad, Himachal Pradesh, India. Okay. Thank you, Shainika. And Asami is craving South Indian food in Himachal Pradesh. I love that.

That's amazing. Yeah, but maybe you should just come down south, Shania. Yeah. Come to Bangalore. We got amazing dosa places here, right? There's a great one, which is also quite like comfort food, I would say, which is amazing. refreshments, which is closed. I love Omesh. Yeah, in Indranes.

Omeh does a killer dosa. I know. The ghee-poorri-dosa. Yeah. Oh my God. Very good. Okay. What's next? Okay, what's next? Stigda, guess what? What? We have two in-house recommendations today. Two of our friends here at the Ken have given us their comfort food recommendations. I want to start with Rahul.

Rahul had social media here at the Ken. So all the great stuff. that you're seeing on social media, on Instagram, on Twitter. All thanks to Rahul. So, Rahul sent us a text. I'm going to read it out for all of you. He recommends egg-fried rice at Tenzin Kitchen. It's a small Tibetan restaurant in Khoramangla. It serves great authentic Tibetan cuisine.

So Thupa, Momo's, Lefing, is that how you say it's in place? Yes. Yeah, lefing, those are Rahul's recommendations. But it also does basic Indo-Chinese dishes. egg fried rice very, very well too, is what Aho says. Whenever a friend or family member

comes to Bangal, this is the one place he tries to take them to for sure. Yeah, Tenzing's Kitchen is a good place. You'd recommend it. Legendary in Bangalore

for Tibetan food. It's very good. Amazing. I'm going to check that out too. Talking about Tibetan food, I have another recommendation. If you ever visit Darjaling, you should go to Kungas

for Tibetan food. You usually have to stand in a queue, especially during tourist season, but it's worth it. You get a good thali there, no? Great Thugpa, no. Oh, great Thupah. You know, living, no, you don't get it there.

But amazing Mo Mo Mo. Also, there's this whole debate, by the way, Rahil, about Mo Mo Mo Moe or Moes. Oh, it's Mo Mo Mo. It's Mo Mo Moes. I stand corrected. Thank you. The more you learn.

Okay, and our next recommendation is from a fellow Ken podcast, host, Aksha Chandra Shankran. Oh! She hosts the Ken's podcast the first two years and she has a very, very lovely recommendation for us. Oh, so nice. I'm excited to listen to this. Hi, I'm Nizh Dhn Rajal.

I'm Akshya. I've been loving the daybreak and wine segment. And when you ask me comfort food, my favorite cuisine is Asian cuisine. And a restaurant that I love back home in Jannay is this restaurant called Dalia. And it's a small... It's in a small nook in this area called Nungamakam. And it's owned by this Indo-Japanese couple, Yamauichi'san and his Tamil partner, Revithi. And it's like more than 30 years old.

I've been eating there since I was a teenager for the past 10 years. And Yamaucian is like close to 90 years old, right? Like I've seen him age dramatically in the past decade. And he's so sweet, so loving. Yamakshi-san and Revita-san serve the food to you directly. They make the food themselves. They're so hands-on. You can sit and chat with them about Japanese history,

how they made it India, how they met, how they fell in love. Very, very cute couple overall. But I'm making them look like the very chatty. They're reticent, but they take that time to get along with you. I think the way the restaurant is, right, so traditional, so Japanese. Like there is origami handmade decor all around. I love the simplicity of the restaurant. so that makes, and the people are so great, that makes it so warm and comfortable.

But the food I would like to recommend is Okonomiaki, which is a Japanese savory pancake, which I had not seen in a lot of Japanese restaurants anywhere. And it's so yummy. I'm a vegetarian, so all my recommendations are going to be vegetarian. And I had, I love this fried tofu sushi, which is so great, so yummy. I feel like it's so authentic. And authentic is an understatement. But it's so authentic, so inexpensive and lovely people.

If you have the time, definitely go check it out. Wow. That was beautiful. Yeah. I want to go to Chennai. Me too. No words. I want to go to Chennai and eat Japanese food ASAP.

Thanks, Aksha. Thank you. Okay, that's it. That's a wrap on our recommendations for this week. Thank you all for writing in. We're so, so grateful to all of you. Great getting to know all of you. Yes, absolutely thanks.

And also for next week, our theme, please listen carefully. It is iconic opening lines from books and movies. Nice one. Yeah, I'm quite excited about this too. Me too. So, you know the drill? Right, so send us your voice notes. And if you're not comfortable sending voice notes,

you can also write to us a text message on our WhatsApp number, which is 89711-0-8.0-8. 379. You'll find it in the show notes. Awesome. See you guys next week. Yes, that's a wrap. Bye.