New Delhi: Large, traditional fast-moving Consumer goods (FMCG) companies such as Nestle, Reckitt Benckiser, Wipro Consumer Care, Marico and Tata Consumer said they are intensifying focus on online-only brands and businesses. They are either setting up dedicated venture funds or investing in smaller startups that sell through online channels to consumers in response to ecommerce sales doubling and niche, evolving categories that emerged amid the pandemic.Nestle is actively exploring online-only opportunities, said Suresh Narayanan, chairman of India’s largest packaged foods company.“The direct-to-consumer space is interesting--we are actively evaluating this space and looking to unlock new avenues of growth,” Narayanan said. Last month, the maker of Nescafe coffee and KitKat chocolates acquired SimplyCook, an online-only recipe kit company in the UK focused on household nutrition. 81302139Wipro Consumer Care Ventures is looking to make more investments in this area this year.“Our focus is on digital-led consumer companies which have been able to find white spaces in a competitive industry, particularly in nutraceuticals, wellness and beauty products,” said Sumit Keshan, managing partner.The Rs 200 crore venture capital fund of Wipro Consumer Care and Lighting, Wipro Consumer Care Ventures--which invested in grooming startup LetsShave just before the Covid-19 outbreak and in consumer healthcare brand Onelife last month--said its focus will be on the startup ecosystem with companies that have been able to create clear consumer-focused niches.The online-only — or direct-to-consumer — segment will be a $100 billion market by 2025, according to a recent report by Avendus Capital.'Next Wave of Value Generation'It said ecommerce is leading the shift to organised online-only brands in India, accelerated by the pandemic.“Direct-to-consumer (D2C) brands are leading the next wave of value generation in the consumer space,” the report said, and noted Indian brands such as Lenskart, Licious, Zivame, Boat, Wow Skin Sciences, Healthkart, Mamaearth, MyGlamm and Sugar among those that have seen increasing funding activity in the past one year.Saffola edible oils maker Marico, which acquired a 100% stake in male grooming brand Beardo in the June quarter, said creating digital-only brands is among its core focus areas.“We have created a separate business unit to focus on digital-only brands that will operate independently of Marico in terms of processes and systems,” managing director Saugata Gupta said. “We are looking at both organic and inorganic growth from direct-to-consumer brands. This is an evolving space and there is a set of consumers who are looking for differentiated products.”Over the past two months, Reckitt Benckiser has invested in grooming brand Bombay Shaving Co (BSC), while Tata Consumer acquired Soulfull, a breakfast cereals and millet-based snacks maker, for Rs 155.8 crore. Soulfull grew 200% through online-only channels amid the pandemic last year.Reckitt Benckiser led the strategic investment round of Rs 45 crore in Visage Lines Personal Care, which owns grooming company Bombay Shaving Company (BSC).“This investment brings together BSC’s expertise in digital-first brands with strong ecommerce capabilities, and RB’s expertise in branding, manufacturing and global scale,” said Arjun Purkayastha, RB’s senior vice president, ecommerce, digital and ventures. BSC said its portfolio of shaving, skin and beard care has now grown almost three times what it was pre-Covid.Consumer AdoptionIndustry executives said consumer adoption of online channels, which surged during the pandemic, will be maintained, despite normalcy returning, with tier-2 and 3 markets further fuelling this trend.Multi-stage venture fund Fireside Ventures, which closed its second direct-to-consumer focused fund at Rs 863 crore in January this year with investors such as ITC, L’oreal and Pidilite group, is exploring half a dozen new investments in digital native brands this year. Kannan Sitaram, venture partner at Fireside Ventures said: “Direct-to-consumer brands are rapidly becoming mainstream and the investor community is very interested in the consumer space, with brands that are evolving and fulfilling untapped consumer needs.”While most brands follow online-only models, some such as BSC and Tata Consumer are also looking at incrementally scaling up offline retail distribution as an add-on.Smaller online-only startups such as Slurrp Farm, Adthera Consumer Brands and Forbidden Foods are among those that also have tied up investments in the past few months.Adthera Consumer Brands, which makes Zingavita gummy bears, raised angel funding of Rs 3 crore in a round led by Anicut Angel Fund. Salty snack maker Forbidden Foods said it has raised seed funding of $1million, led by curated crowd-funding platform and early stage venture fund Globevestor along with Secocha Ventures. Healthy snacks and cake mixes company Slurrp Farm raised $2 million in a Series A round from Fireside Ventures last December.