Daybreak - Why Curefoods is dead set on expanding its menu beyond salads

Episode Date: March 11, 2025

When the Bengaluru-based Cloud kitchen operator Curefoods went ahead and acquired the distribution rights for the American donut and coffee brand Krispy Kreme in December last year, a lot of people were naturally quite surprised. Given the company’s roots in the fitness startup Cult fit, you would assume that it would be in Curefood’s best interest to promote all things “healthy”. Even its flagship brand up until now, Eatfit, is popular on delivery platforms for its healthy, clean food options. But turns out, that’s not the path this cloud kitchen operator wants to walk down anymore. It is now dead set on expanding its menu beyond just salads. And the only way to do that is by giving people what they really want — junk food. Tune in.Daybreak is produced from the newsroom of The Ken, India’s first subscriber-only business news platform. Subscribe for more exclusive, deeply-reported, and analytical business stories.The Ken is hosting its first live subscriber event! Join two long-term and contrarian CEOs, Nithin Kamath of Zerodha and Deepak Shenoy of Capitalmind, as they discuss the mental models, decision making frameworks, and potential outcomes related to a very real possibility: an extended stock market winter that lasts 24 months or more. Click here to buy your tickets. 

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 Raman Ganeshan, 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. Late last year, Bangalore-Based Cloud Kitchen Operator Kure Foods went ahead

and acquired the distribution rights for the American donut and coffee brand, Krispy Cream. And naturally, a lot of people were quite surprised. Given the company's roots in the fitness startup cult fit, you would assume that it would be in cure food's best interest to promote all things, quote unquote, healthy. Even its flagship brand up until now, Eat Fit, is popular on delivery platforms for its healthy, clean food options. But turns out, that is not the path this Cloud Kitchen operator

wants to walk down anymore. It's now dead set on expanding its menu beyond just salads. And the only way to do that is, by diversifying. Which is why today, it houses eight major brands. From the milkshake and ice cream brand frozen bottle to the dine-in biryani chain

Sharif Bai, whatever you may be craving, Kure Foods' Buffet of Brands has got you covered. But of course, it isn't easy running multiple brands. Because on the cloud kitchen side of things, it means optimizing your kitchens for maximum efficiency. It also means turning to dine in for more

margins. Kure Foods has done all of that. But it realized its single biggest growth engine is understanding what the people really want. You see, for a company to make it big in the food business, it has to cater to the Indian palate. And the Indian palate? Well, it likes its junk food. Pizza, sandwiches, burgers and fried chicken account for around 70% of the nearly 38,000 crore-rupy quick-service restaurants market. And the biggest slice of that pie, ironically enough, is taken up by pizza.

Now, this particular statistic is not something Kure Foods takes lightly. In fact, in its new avatar, EatFit will no longer be its flag bearer. Its new crown jewel is very quickly becoming the pizza brand, Ollio. Ollio happens to be the third largest in Kure Foods bucket of eight brands. It's one of its few brands that have actually proven to be profitable and has about 120 to 130 crore rupees in annualized sales.

Kure Foods sees huge promise. enough promise to take on the reigning king of pizzas, Domino's. Naturally, that's easier said than done. But the thing is, there has never been a better time to try. Especially considering how Domino's franchisee, jubilant food works, is already dealing with fierce competition. So can pull your swoop in and knock it off its perch? Well, let's find out.

Welcome to Daybreak, a business podcast from The Ken. I'm your host Rahil Philippos and I don't chase the news cycle. Instead, I'll be joining my colleagues Dikta Sharma every day of the week to bring you one business story that is worth understanding and worth your time. Today is Wednesday, the 12th of March. We've been talking about the next chapter of the cure food story, but the OG main character, Eatfit, deserves a lot of credit for bringing it where it is. In many ways, without it,

cure foods may not have been able to consider diversifying at this scale. And that's because EatFit gave it the revenue and base infrastructure needed to get this new strategy moving. It already had a whole bunch of cloud kitchens in place and was even generating revenue after it was spun off from KaltFit. But that's also when KureFit realized that it needed to stay relevant. And Anand Prasanna, who's been on Kure Foods Board of Director since 2021, said there was only one way to do that by delivering whatever customers wanted.

Otherwise, Prasanna said, you run the risk of becoming very niche. Kure Foods founder Ankit Nagori conquered. When he spoke to the Kahn at the startup's corporate office in Bangalore recently, he said they realized something very significant within four months of starting. They realized that their kitchens were being utilized far less on weekends because typically that was when people treated themselves to junk food. People didn't need healthy food seven days a week. The national solution to this problem was to diversify.

So over the last few years, it started really, rapidly acquiring a bunch of brands across categories. Apart from oleo, frozen bottle and cake zone, it also houses brands like Aramban for South Indian food or the more gourmet pizza chain nomad. It also has a bunch of different healthy brands to its name, like Madras Curder Ice Company or Millet Express or Home Plate. Kure Foods is currently present in over 500 locations in more than 40 cities.

And all of these locations, around 70 are single-brand takeaway kiosks. think crispy cream or frozen bottle. Another 75 are dine in restaurants like Sharif Bhai Biryani, Nomad and Aramban. And the remaining are multi-brand cloud kitchens. It sounds like a lot. And it is. But the thing is, cure foods isn't blindly entering different categories. It's doing it very intentionally.

It's building synergies between these brands and their infrastructure. And that is where the profits lie. Let me explain how it works. Just take one of its multi-brand cloud kitchens as an example. Typically, there will be three assembly lines for Indian cuisine, pizza and dessert. Nagori said that it's sort of like an airline kitchen. So say there are certain paneer dishes across the menus of these brands, the same cubes of panir, batter and spice mix will end up being used across these brands.

Nagori says it's almost like breaking down food into pieces of Lego, the Lego here being the ingredients. Over the years, they've been able to refine the process. So, while two years ago, three or four brands may have been functioning within the same kitchen, now that number has gone up to six or seven. Now, Gori explained that usually Cure Foods launches a kitchen with a minimum of three brands. And in most cases, it starts out with its three biggest brands, eight-fit cake zone and oleo.

It takes about four to five months for a new kitchen to reach break-even, but about 18 months to reach its target of double digit ebita. Nagora says that is how long it takes to understand the market, bringing all the requisite brands and then add the necessary personnel. This operational efficiency is the bread and butter of any multi-brand cloud kitchen company. And cure foods is going all out to get it right. But beyond that, it has managed to thrive by taking calls that others did not and could not. More on that in the next segment.

Cure Foods is not like other cloud kitchen operators. It's always gone against the grain in some way or the other. For instance, while most giants in the space invested huge amounts of money towards building their own delivery apps, Cure Foods has been pretty dismissive of the idea. It actually ditched the direct-to-consumer app it already had from its era under Culpfit because it believed it was a distraction from its core business of building strong brands. The company decided it would much rather work with existing channels like Swiggy and Zomato

than build one of its own. Prasanna explained that it came from a certain place of self-awareness. The company recognized that the math was against it. Swigy and Zomato have so many people on the ground and also have access to so many brands that their cost per delivery would always be better than cure foods. The flip side of this, of course, that most people in the space would point out is being overly dependent on aggregators. But Nagori explained that that was.

wasn't really a concern for them. That, after all, is the very nature of the business. People come to the platform because the entire supply exists. Kure Foods is also different in terms of how it has built its brands. It had a single-minded focus on acquisitions right from the start, while others started out with a range of in-house brands and then picking up others later on. That means when a rival like Rebel Foods acquires a brand,

it has to be integrated into the existing playbook first. which already poses restrictions on the existing teams. But cure foods starts with a blank state. It retains the founders of the companies that requires instead. For instance, Olio Pizza's founder, Shittage Budhani, is still involved with cure foods and continues to lead the brand. Retaining most of them wasn't just an option, but a necessity, it seems, because experience of course matters.

That said, cure food's bets are now paying off. Case in point, Oliot, one of the few cure food. Pure Foods brands that are profitable. Stay tuned. When we spoke to Nagoria a while ago, one of the questions we asked was about KureFood's biggest success stories, the brands that ended up working really, really well.

And without skipping a beat, he said, OLLio. Even in the last few months, Olio has been one of the company's first ambassadors to foreign shores. It launched Olio, Sharif Bhai and EidFit in Dubai, which happens to be its first international market. Ollio currently operates over 180 countries. around nearly 30 cities in India,

and the secret of its success is its simplicity. It's super easy to throw together. The dough and sauces are made out of one of Qure Foods' handful of central commissaries. The kitchen merely needs to receive the ingredients and then put them together with minimal labour. While there's another pizza brand Nomad in KureFood's portfolio, Olio is lighter on the wallet and hence has a more promising growth trajectory. The company positions itself as a really good pizza at an affordable price.

Perhaps it's this uniqueness that's fueling the brand in going after legacy players like Domino's. It's good news for Olio that the latter's domination in the pizza market has been on the decline owing to consumers flocking to other brands. Nagori says the other thing that's working for the company is that in general, the younger generation doesn't seem to like incumbent brands as much anymore. And if Domino's market share is anything to go by, he may have a point. It came down to 48% from 65% a decade ago. Its gross margins have also been declining.

Now, Olius vision is simple. It wants to be wherever Domino's is. But that's not easy to match a cost. Because in terms of revenue, Jubilant earns 1,600 crore rupees in the last quarter. That's more than double that of all Cure Foods brands combined in FI24. So despite scaling rapidly, Olius' footprint remains a fraction of domino.

So wondering whether or not Oreo becomes the next dominoes may be looking a little further down the road. But for now, the good news is, Cure Foods is on the right track. Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Head to the Ken.com and click on the red subscription. button on the top of the website. Today's episode was hosted by Rahil Filippo's and edited by Rajiv Sien.