Diving into innovation – Feet first! Introducing Solethreads


26 Sep 2023



Vinay Singh

Diving into innovation – Feet first!  <span>Introducing Solethreads </span>

The Sleep Company’s Priyanka and Harshil are shaking up a category which has seen no innovation since the invention of memory foam. 91’s Sachin and Vishal are disrupting the world’s second-largest cycle market with a range of world-class bikes. boAt’s Aman and Sameer have broken the stranglehold of international labels on the tech-led category of audio. Each of these founders have brought their own blend of innovation to decades-old, incredibly large categories. And that’s exactly what our newest portfolio founders – Gaurav, Sumant, Aprajit, and Vikram, co-founders of Solethreads – are doing to the multibillion-dollar footwear market.

They aren’t just passionate about building the brand, their cross-functional skills give them a strong understanding of the category, combined with sales, marketing, and e-commerce expertise to fuel expansion. Gaurav is a designer, and a second-generation footwear manufacturer whose passion it is to design better products, while Sumant brings deep understanding of data, technology and analytics from his stints at leading MNCs. These strengths are further enhanced by Aprajit’s expertise in consumer insights and brand building, and Vikram’s experience with channels. They make a strong founding team that is well placed to propel Solethreads into a household name.

The background

Footwear is a large and important consumer category in which Fireside has not had a presence. Barely 33% of the market is organised, which is predicted to grow to 38%, or INR 539 billion, by 2025. This growth will come from consumers moving up the value chain, from unbranded footwear to branded products, particularly in the economy (priced at INR 500-1000) and mid-price (priced at INR 1000-2000) segments.

Of these, casual footwear is the largest segment, accounting for almost 70% of all spends, and projected to dominate in the coming years, too. Younger consumers are consciously choosing a more casual lifestyle than previous generations, however, the industry has not responded with too much innovation. Mass brands offer undifferentiated products at similar price points, while premium/ international brands offer limited innovation & selection, and a broken offline GTM – at a price tag upward of INR 2,000.

The space has already delivered large successful outcomes for investors through brands like Relaxo and Campus. Interestingly, despite being a lifestyle product, footwear remains largely indifferent to trends and seasons, making it extremely working capital-efficient, and an attractive space for investment.

The gap

India is largely an “open” footwear market, where people wear flipflops or chappals on most occasions, including to college and to work. This is particularly true of the South and West regions, where milder winters don’t force you to wear closed shoes, and the year-round heat and humidity make open footwear more comfortable, breathable, and easier to clean and maintain. Open footwear also suits cultural practices like taking off one’s shoes before entering a home, or a place of worship.

The sub-30 age group consisting of millennials and Gen Zs prefer the casualness of open footwear, and see it as reflective of their lifestyle – they consistently choose comfort, convenience, and versatility over formal or athletic footwear. Currently valued at ~INR 14,000 Cr, open footwear itself is set to become a ~INR 35,000 Cr market by 2030 as per Solethreads.

Interestingly, this is a space that international shoe brands have struggled to crack, as they lack the DNA. Flipflops and slides are usually seen as beachwear or vacation wear, whether Havaianas or Crocs. Indian players like Bata, Relaxo, and Paragon continue to make minor design changes without any serious innovation or tangible product improvement.

Today’s consumers seek the same variety and value in footwear that they do in other categories – good brands with high functional and design qualities. Solethreads introduced design innovation at the product level, creating products from ground up to meet specific use cases. The result?  Disruption and differentiation leading to high brand recall and strong word of mouth.

The moat

Inhouse R&D, strong manufacturing roots, and excellent relationships across the supply chain allows for the production of high quality, extremely comfortable, well designed shoes and flip flops at an affordable price point. This foundation enables a high-frequency cycle of innovation, going from design to production in 45 days flat.

This unique fast innovation cycle enables the business to do fast drops on their website and leverage their learnings to get into larger MOQs to feed demand in marketplaces & GT. They have a EBO first omnichannel approach to own the consumer experience and have the ability to engage them at various touchpoints. This GTM approach, we believe, will help them to scale efficiently.

On the product side, Solethreads products are often compared to Skechers or Crocs with respect to comfort, with a much lower price tag. Their practice of using recycled material in their production process is something the younger, more socially conscious consumer finds very attractive.

From a unique three-layer sole for indoor-outdoor use, to a soft faux-grass insole that mimics the feeling of walking barefoot; and from recycled yoga mat footbeds for great comfort and support, to Kevlar outsoles for all-terrain use, Solethreads offers consumers a range of brand-new, India-first products they love to use.

The business

Like most new-age brands, Solethreads is usually discovered online or through social media. However, the footwear category relies on touch and feel, and in this context, an offline presence is critical. Currently, Solethreads is available at ~700 points of sale across India through the Metro Shoes network of stores, as well as key local stores like Profit in Hyderabad, and Popular Shoes in Delhi.

Solethreads will look to engage consumers both online and offline. We believe their EBO and distribution strategies will help them scale way beyond the INR 10 Cr MRR water-mark.

The consumer

Solethreads’ comfort and design have led to strong customer love with a customer NPS of 70.6, and an above industry average repeat rate of 16% over a 12-month cohort. Customers are quick to recommend the brand to friends and family, calling out product quality, comfort, and excellent value for money. Their consumer is typically a younger Millennial or Gen Z looking at casual footwear options for everyday wear and are unwilling to compromise style & comfort but need their products to be priced sharply.

The opportunity

At Fireside, we’ve watched this space – and this brand – for years. Solethreads has systematically carved out a niche for itself, putting in place a sound NPD process, and a fully Make-in-India supply chain at a time when footwear import duties are rising. Innovation and deep consumer understanding are guiding their journey as they build out their omnichannel presence, reaching more consumers with a distinctive product they can touch, feel, and flaunt.

We believe that this brand will continue to disrupt casual footwear as India knows it, and we’re thrilled to be part of their journey.

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