Imdad Hussain
Gaon is not just a name- it is a celebration of authentic Indian cuisine, a brand that has redefined the way we experience regional flavors. Founded by Alok Ranjan, a proud native of Champaran, Bihar, Gaon began as a single outlet in 2018 and has since grown into a multi-brand food company serving authentic Bihari, Rajasthani, and Awadhi cuisines. With over 4 lakh orders fulfilled and an ever-expanding menu that includes brands like Champaran Meat Co., Dumara, and the upcoming Trihut, Gaon’s story is as flavorful and inspiring as the dishes it serves.
In this article, we delve into the behind-the-scenes story of Gaon, explore its revenue milestones and unit economics, break down its equity structure and year-wise performance, and recount its memorable pitch on Shark Tank India that changed its destiny.
The Humble Beginnings: Alok Ranjan’s Journey
Alok Ranjan’s journey is a testament to passion, perseverance, and the courage to dream big. Growing up in Champaran, Bihar, Alok’s early life was rooted in the simplicity and authenticity of rural India. He attended school in his hometown before heading to Delhi for his B.Tech. Despite the lure of a conventional engineering career, Alok’s heart was set on entrepreneurship. Initially hesitant to reveal his ambitions to his family, he eventually mustered the courage to express his desire to pursue not just an MBA or BBA, but a life driven by entrepreneurial spirit.
After completing his MBA and working at Paytm- a stint that gave him invaluable corporate exposure- Alok took a bold leap in 2018. Driven by a deep love for regional cuisines and a determination to showcase authentic Indian flavors, he invested a personal sum of ₹9.5 lakhs, along with additional funds borrowed from friends and cousins, to open a single dine-in restaurant in Lajpat Nagar, Delhi. This outlet laid the foundation for what would soon evolve into Gaon.
The Genesis of Gaon: From Single Outlet to Culinary Brand
The inception of Gaon was far from ordinary. In its early days, the restaurant specialized in Bihari and Rajasthani cuisines, aiming to bring regional authenticity to Delhi’s cosmopolitan palate. The restaurant quickly gained traction with customers who craved the rich, robust flavors of home-cooked Indian food. However, the onset of the COVID-19 pandemic forced the closure of the dine-in restaurant, compelling Alok to rethink the business model.
Rather than succumb to the challenges, Gaon reinvented itself by pivoting to a cloud kitchen model. This strategic transformation allowed Gaon to serve a wider customer base while keeping overheads lean. Today, Gaon operates as a cloud kitchen and has expanded its culinary repertoire to include Awadhi cuisine alongside its original Bihari and Rajasthani offerings. The evolution from a single outlet to a multi-brand food company underscores Alok’s resilience and adaptability in the face of adversity.
Revenue Milestones: A Timeline of Growth
Gaon’s financial journey mirrors its rapid growth and market acceptance. Let’s take a look at the year-wise revenue figures that have defined the brand’s evolution:
- FY20-21: Gaon recorded sales of ₹90 lakhs.
- FY21-22: Sales nearly doubled to ₹1.62 crores, signaling a strong recovery and market expansion after the initial challenges.
- FY22-23: The brand experienced explosive growth, with sales reaching ₹3.86 crores.
- FY23-24: Gaon’s revenue further increased to ₹5.5 crores, reflecting its growing popularity and operational efficiency.
Looking ahead, the projections remain promising:
- For FY24-25: Gaon is expected to hit sales of ₹7.5 crores.
Additionally, for the oldest cloud kitchen located in DLF Phase1, Gurugram, sales have shown a positive trajectory- ₹90 lakhs in FY21-22, rising to ₹1 crore in FY22-23, and reaching ₹1.8 crores by September in FY24-25. Projections for FY26-27 estimate annual sales per cloud kitchen at approximately ₹3.6 crores.
These figures are not mere numbers- they are indicators of a brand that has successfully navigated a challenging market landscape to capture the hearts and palates of its customers.
The Intricacies of Unit Economics
Behind Gaon’s robust revenue figures lies a meticulously balanced unit economy that enables sustainable growth even in a competitive market. The breakdown of Gaon’s unit economics is as follows:
- Cost of Goods Sold (COGS): 31%
- Salaries: 10.5%
- Rentals: 6.5%
- Electricity & Water Expenses: 3.5%
- Marketing: 2%
- Packaging: 3.5%
- Discounts: 15%
- Commissions: 20%
- Others: 1%
After accounting for all these expenses, Gaon managed to secure a net margin of 7%. This careful balancing act managing costs while delivering authentic, high-quality cuisine—has been a cornerstone of Gaon’s operational strategy. For instance, even during September 2024, Gaon’s projected sales were ₹49 lakhs with a net profit of ₹1.5 lakhs, reflecting the delicate equilibrium between revenue generation and cost management.
Outlet-level monthly sales further underline the efficiency of the model, averaging between ₹15 to 16 lakhs. Moreover, Gaon’s sales split is strategically divided between its brands 60% from Gaon and 40% from Champaran Meat Co. ensuring a diversified revenue stream that mitigates risks and captures varied customer preferences.
Equity and Capital
Alok Ranjan’s personal investment of ₹9.5 lakhs marked the humble beginning of Gaon’s capital journey. However, as the brand began to scale and gain market traction, additional funds were secured from friends and cousins, providing the initial financial boost needed to expand operations.
Gaon’s equity structure is designed to align the interests of all stakeholders in the company’s success. The current equity split is as follows:
- Alok Ranjan (Founder): 80%
- Shashank: 10%
- Employee Stock Ownership Plan (ESOP): 5%
- Other Funding Members: 5%
This distribution not only cements Alok’s control over his brainchild but also incentivizes the team and partners who contribute to the brand’s growth.
The Shark Tank India Experience: A Turning Point
Gaon’s journey reached a significant milestone when it appeared on Shark Tank India. The brand’s innovative approach to authentic regional cuisines and its impressive growth metrics made it a compelling prospect for investors. During the show, Gaon’s founders initially asked for ₹80 lakhs in exchange for 4% equity, which would have implied a valuation of ₹20 crores. However, negotiations led to a different outcome.
After evaluating the potential and operational efficiencies of the business, the sharks proposed- and ultimately closed a deal with Anupam and Vineeta. The final offer was ₹80 lakhs for 8% equity, effectively placing Gaon’s valuation at ₹10 crores. This deal not only provided critical capital but also enhanced the brand’s credibility, opening doors to new markets and further investments.
The Shark Tank India experience was more than just a funding round, it was a validation of Gaon’s business model, a testament to the strength of its unit economics, and a springboard for future expansion. The deal also highlighted Gaon’s readiness to scale, leveraging technology and innovation in its cloud kitchen operations to deliver quality food to a broader audience.
The Multi-Brand Strategy: Diversifying Flavors and Fortunes
Gaon’s current offerings extend beyond the flagship brand. The company has strategically developed multiple brands to cater to diverse culinary preferences:
- Gaon: Specializes in Rajasthani, Bihari, and Awadhi cuisines, serving as the umbrella brand that embodies the ethos of authentic Indian cooking.
- Champaran Meat Co.: Focuses exclusively on Bihari non-vegetarian dishes, offering robust flavors that resonate with meat lovers. Its average order value is higher at ₹675, compared to Gaon’s ₹375, highlighting the premium nature of its offerings.
- Dumara: Known for its delectable biriyani, Dumara is carving out a niche among biriyani enthusiasts.
- Trihut (Upcoming): Set to offer an exciting range of snacks, Trihut is anticipated to capture the growing market for quick, flavorful bites.
Each of these brands is carefully positioned to cater to specific customer segments, ensuring that Gaon’s overall portfolio remains dynamic and resilient. The sales split currently stands at 60% for Gaon and 40% for Champaran Meat Co., providing a balanced revenue stream that supports sustained growth.
The Impact of COVID-19 and the Cloud Kitchen Pivot
The COVID-19 pandemic posed unprecedented challenges for the food and beverage industry, and Gaon was no exception. The closure of the dine-in outlet in Lajpat Nagar could have marked a setback. However, Alok’s quick pivot to a cloud kitchen model not only mitigated losses but also positioned Gaon to capitalize on the surge in online food delivery. By leveraging technology and digital platforms, Gaon managed to serve a larger audience while reducing the fixed costs associated with traditional dine-in operations.
This shift to cloud kitchens proved to be a masterstroke. The model allowed Gaon to experiment with new products- bundling them with regular orders for instant customer feedback- thereby fostering innovation and continuous improvement. The cloud kitchen format also enabled the brand to expand its geographical reach without the need for multiple physical outlets, ensuring that authentic regional flavors could be delivered right to the customer’s doorstep.
The Essence of Gaon: Authenticity, Innovation, and Community
At its core, Gaon is more than just a food company it is a celebration of Indian heritage, a bridge between rural authenticity and urban modernity. The brand’s commitment to serving genuine regional cuisines is deeply rooted in Alok Ranjan’s own experiences and his desire to bring a piece of Champaran to the world. Every dish, every flavor, and every innovation at Gaon is a reflection of a rich cultural legacy combined with the entrepreneurial spirit that dares to dream big.
Customers not only appreciate Gaon’s culinary excellence but also resonate with its story- a narrative of humble beginnings, relentless pursuit of quality, and the courage to reinvent in the face of adversity. Whether it’s the soulful taste of Champaran Handi Mutton or the rich aromas of biriyani at Dumara, Gaon continues to evoke nostalgia and pride among its patrons, reminding them that authentic food carries the warmth and tradition of home.
Conclusion
From its modest inception in 2018 as a single outlet to its current status as a multi-brand cloud kitchen powerhouse, Gaon’s journey is nothing short of inspirational. Alok Ranjan’s story- from a determined young man from Champaran who dared to dream beyond conventional paths to a visionary entrepreneur who transformed challenges into opportunities- forms the backbone of Gaon’s success.
Looking ahead, Gaon is poised for continued expansion, with plans to leverage its cloud kitchen model, refine its multi-brand portfolio, and introduce innovative products that resonate with the evolving tastes of its customers. As the brand continues to grow, it remains anchored in its mission to deliver authentic Indian cuisines that not only satiate hunger but also evoke a sense of cultural pride and nostalgia.