How a Daily Wager's Son Built a Rs 294 Crore Turnover Company

Usha Prasad | Bengaluru

Updated On: 27-May-2021

Vol 7 | Issue 46

P C Mustafa, son of a daily wager who grew up in Chennalode, a remote village in Wayanad district of Kerala which had neither electricity nor roads, was bitten by the entrepreneurial bug early in life - at the age of 10

“Since my family lived on the meagre earnings of my father who slogged as a daily wager, getting pocket money was a distant dream for me.

Mustafa, CEO of ‘iD Fresh Food’, hails from a remote village in Kerala (Photo: Special Arrangement)

“So, during the summer holidays I borrowed Rs 100 from my uncle and set up a make-shift mithai shop (which sold chocolates and sweets) in our village.

“It gave good returns and I got my pocket money,” quips Mustafa, CEO of ‘iD Fresh Food’, a ready-to-cook packaged food company in Bengaluru that registered a turnover of Rs 294 crore during FY 2020-21.

iD Fresh Food makes idly and dosa batter, ‘just heat’ parotas and chapattis, and curd and paneer. It covers 25 cities in India, covering 30,000 outlets within and outside the country, and plans to take it to 50 cities in the next three years.

The company’s 80,000 sq ft factory plant at Anekal, in the outskirts of Bengaluru can produce up to one lakh kg of idly and dosa batter and 3 lakh parotas in a day.

The brand’s other products include squeeze and fry Vada batter, whole wheat chapatis, natural paneer, curd, grated coconut in a coconut, and smart sip tender coconut.

“We have transitioned from a family-run business to a professionally-run organisation. iD Fresh Food runs on IT; the operations are totally automated and is technologically-driven,” explains Mustafa.

iD Fresh Food, a private limited company, was founded in 2005 by Mustafa and his four cousins - Abdul Nazer, Shamsudeen TK, Jafar TK and Noushad TA. In the initial days, Mustafa held 50 per cent share in the company while his cousins held the rest.

It would be difficult to imagine now that Mustafa’s rise from an impoverished childhood to a successful entrepreneur might have been marred, and he could have ended up as a daily wager just like his father.

As a kid, Mustafa assisted his father in his labour jobs after school and during weekends. But when he failed in Class six – he was an average student until then - his father wanted him to stop studying and start working with him full time.

“It was my maths teacher, Mathew sir, who forced my father to give me one more chance. I repeated Class six sitting with my juniors. I was good at Maths, but weak in both English and Hindi.

“Mathew sir took personal interest in me and taught me after school. I came first in Class seven much to the surprise of all the teachers and my friends,” says Mustafa, now 46, who went on to excel in his studies.

After Class 10, Mustafa secured admission in Farooq College in Kozhikode (Calicut) for his pre university course. When he found it difficult to pay his tuition and hostel fees, a friend of his father arranged for free meals at the hostel.

Mustafa (left foreground) with iD Fresh team members (Photo: By Special Arrangement)

Later, he secured 63rd rank in the state in the engineering entrance exam and got admission at Regional Engineering College (now National Institute of Technology) in Computer Science, the subject he liked most.

After completing his engineering in 1995, Mustafa got placed at a start-up in Bengaluru for a salary of around Rs 6,000 per month.

Two months later he got a job at Motorola with a salary of Rs 15,000. The company sent him to Ireland, where he worked for a year and a half.

From Motorola he shifted to Citibank, Dubai, where his salary now crossed Rs 1 lakh. “I sent my first month’s salary of Rs 1.3 lakh to my father through a friend of mine to clear all his debts.

“He had a debt of around one lakh rupees. I was told that my father could not believe that his son’s monthly salary was more than his lifetime debt and that holding the money in his hand he had wept uncontrollably,” recalls Mustafa.

With his earnings in Dubai, he soon constructed a house for his parents in his village and his father could also get his three sisters married.

Mustafa himself got married in 2000 and has three sons now.

After seven years in the Middle East he returned to Bengaluru in 2003 with a saving of Rs 15 lakh and decided to do an MBA.

“Though I had a good GATE score, I couldn't continue higher studies after my engineering due to financial constraints,” says Mustafa, who enrolled for an MBA at IIM Bangalore.

While doing his MBA he would regularly drop by at Nazer’s kirana shop in Thiappasandra and spend time with his cousins.

A cousin popped up the idea of starting a idly/dosa batter business and Mustafa plunged into it (By Special Arrangement)

One day his cousin Shamsudeen said he had seen dosa batter being sold in plastic bags in nearby stores and suggested that they do something similar.

“We decided to give it a try and I invested Rs 25,000 to start the batter business,” says Mustafa.

Initially, they supplied the batter to 20 stores in Bengaluru under the brand name ‘ID’ – for Idly, Dosa – operating from a 550 square feet space with two grinders, a mixer and a sealing machine.

“We made profit from day one. Soon I invested another Rs 6 lakh to add more machines,” says Mustafa.

They also moved to a bigger space of 800 sq ft. In two years, the company was making 3,500 kg of batter daily. The number of stores they partnered with also increased to around 300.

In 2007, after getting his MBA, Mustafa officially joined as the CEO in charge of marketing and finance of iD Fresh.

As the demand for their product increased, Mustafa invested another Rs 40 lakh in 2008 and bought a 2,500 square feet shed in the Hoskote Industrial Area.

In 2009, he sold his property in Kerala that he had purchased while working in Dubai and pumped in an additional Rs 30 lakh into the business.

iD Fresh plans to enter the US market next year (Photo: H K Rajashekar)

In 2013, they started operations in Dubai and launched filter coffee decoction products in October 2018. “In March 2021 alone, we sold around 35 lakh cups of coffee and looking at Rs 50 crore sale in 2021-22 from coffee,” says Mustafa.

The company has so far raised around Rs 190 crore from Helion Ventures and Premji Invest. The money raised from Premji Invest has been used to build world-class factories within and outside India.

“The journey in the last five years has been exciting. We raised funding from Premji Invest, we hired professionals from the industry to build a strong leadership team, we did some beautiful, touching campaigns and it worked well for us,” says Mustafa.

Mustafa (second from right) with his cousins (Photo: By Special Arrangement)

iD Fresh Food which achieved a turnover of Rs 100 crore in 2015-16 aims to finish at Rs 500 crore in 2021-22.

“With next round of funding on the cards, this year we plan to invest Rs 100 crore in new production plants in Delhi, Hyderabad, and the US, and also expand our footprint in Chennai, Delhi, Pune, Hyderabad, and Kolkata, as well as overseas markets in Saudi Arabia, Oman, Bahrain, and Qatar,” informs Mustafa.

Mustafa has his two cents for aspiring entrepreneurs: “If you have the passion to start something, do it immediately. Don't wait for tomorrow,” he offers.

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