Quick Commerce Gen Z Customers: How D2C Startups Are Winning in 2025
Quick Commerce Gen Z Customers: How D2C Startups Are Winning in 2025
Published on April 20, 2025
D2C brands are leveraging quick commerce to reach Gen Z customers in record time | Photo Credit: Fireside Ventures
While traditional FMCG giants struggle with consumption slowdowns, Direct-to-Consumer (D2C) startups are experiencing robust growth by targeting quick commerce Gen Z customers. According to Kannan Sitaram, co-Founder and Venture Partner at Fireside Ventures, this success is primarily driven by the rapid delivery platforms that help these nimble companies effectively reach younger consumers and capitalize on India’s growing affluence.
Table of Contents
- The Triple Disruption: Quick Commerce, Gen Z, and Rising Affluence
- Fireside Ventures: Backing India’s Consumer Brand Revolution
- How Quick Commerce Is Transforming D2C Growth
- Beyond Digital: The Omnichannel Imperative
- Venture Capital’s Active Role in Portfolio Development
- FMCG Acquisition Trends and Exit Opportunities
- Technology Innovation in Consumer Startups
The Triple Disruption: Quick Commerce, Gen Z, and Rising Affluence
The remarkable growth of D2C brands in India is being fueled by three interconnected market disruptions that traditional consumer goods companies have been slower to capitalize on. At the center of this transformation is the powerful connection between quick commerce Gen Z customers and innovative direct-to-consumer brands.
Kannan Sitaram of Fireside Ventures explains that this convergence of trends has created a unique growth opportunity: “All the big FMCG companies are talking about how consumption isn’t growing but when we look at our portfolio companies, these companies have seen rapid growth. Quick commerce is a key disruption but there are a few other factors. India is getting more affluent. It is no longer a pyramid structure. The age profile of the consumers of D2C firms is also a factor. Gen Zs are emerging as key consumers. We are focused on these three disruptive factors when we assess our investments.”
This perspective highlights why D2C brands are outperforming traditional consumer giants in 2025. The rapid delivery model of quick commerce platforms has created a powerful new distribution channel for reaching Gen Z customers who value convenience and immediate gratification. As digital natives, these younger consumers have naturally gravitated toward brands that offer seamless, technology-driven shopping experiences.
Fireside Ventures: Backing India’s Consumer Brand Revolution
Launched in 2017, Fireside Ventures has established itself as a leading venture capital firm focused exclusively on the consumer sector. With ₹3,000 crore ($395 million) in assets under management, the firm has made 59 investments in new-age consumer brands that have demonstrated the ability to scale efficiently while addressing evolving consumer preferences, particularly among quick commerce Gen Z customers.
Notable Fireside Portfolio Companies
- Mamaearth – Personal care products focused on toxin-free formulations
- boAt – Audio products and wearables brand
- Yogabar – Nutrition-focused food brand recently acquired by ITC
- Kapiva – Modern Ayurvedic nutrition products
- The Ayurveda Experience – Ayurvedic beauty and wellness products
- The Baker’s Dozen – Artisanal bakery products
- The Sleep Company – Innovative mattress and sleep products
In an exclusive interview, Sitaram revealed that numerous portfolio companies are now preparing for either public listings (IPOs) or strategic sales, validating the firm’s investment thesis that backed capital-efficient consumer startups with potential for significant scale. Many of these brands have effectively leveraged quick commerce to reach Gen Z customers, helping them achieve growth rates that outpace traditional retail channels.
How Quick Commerce Is Transforming D2C Growth
The emergence of platforms offering delivery in 10-30 minutes has created a perfect environment for D2C brands to connect with quick commerce Gen Z customers. This distribution channel alignment has proven to be particularly powerful for several reasons:
Why Quick Commerce Works for D2C Brands
- Speed Alignment: Both D2C brands and Gen Z customers value efficiency and immediacy
- Discovery Opportunity: Quick commerce platforms expose new brands to consumers browsing for immediate needs
- Digital-First Interface: The shopping experience matches the preferences of digital natives
- Data Advantage: Real-time purchase data helps brands optimize products and marketing
- Lower Barriers to Entry: Easier for new brands to gain distribution compared to traditional retail
Quick commerce has emerged as the sweet spot where digital-native brands can connect with digital-native consumers, creating a virtuous cycle of growth that traditional FMCG players have been slower to capitalize on.
This convergence has allowed D2C startups to gain significant traction with Gen Z customers who value both convenience and authenticity. The ability to fulfill immediate purchase decisions through quick commerce has created a powerful new channel for brands that can move quickly enough to capitalize on it.
Beyond Digital: The Omnichannel Imperative
While quick commerce Gen Z customers represent a significant growth opportunity, Sitaram emphasizes that sustainable scale requires a thoughtful omnichannel approach. The initial digital success must eventually extend into a broader market presence.
Can D2C companies achieve scale by just focusing on digital channels?
“Digital is only a starting point. But once the brand is built, consumer is going to look for it wherever they shop. The Indian customer is not digital only. Opportunity is lost if they don’t go offline. They start D2C, go to Amazon or any other e-commerce site -these days this space is being taken up by quick commerce- and then they head to retail stores. Take, for example, Chennai-based Sweet Kaaram Coffee – they used to sell only online, then made a mark through quick commerce, and now their select SKUs are in top food retail stores too. They have made the transition in a very deliberate way.”
Sitaram’s insights reveal a critical evolution in the D2C playbook for reaching Gen Z customers. While digital channels provide an excellent launchpad for new brands, sustainable scale requires a more comprehensive approach.
The D2C Brand Evolution Pathway
- Direct-to-Consumer Phase: Building initial brand identity, collecting first-party data, and establishing direct customer relationships
- E-commerce Marketplace Expansion: Leveraging established platforms like Amazon to reach broader audiences
- Quick Commerce Integration: Capitalizing on rapid delivery platforms to serve immediate needs and reach impulse purchasers, particularly Gen Z customers
- Strategic Offline Presence: Selective entry into physical retail with optimized SKU strategy to capture omnichannel consumers
This methodical approach allows D2C brands to maintain their digital DNA while expanding their reach to customers across multiple touchpoints. The quick commerce phase is particularly crucial for connecting with Gen Z customers, who often discover new brands through these platforms before seeking them out in other channels.
Venture Capital’s Active Role in Portfolio Development
For D2C brands targeting quick commerce Gen Z customers, having the right venture capital support can make a significant difference. Unlike traditional venture capital firms that primarily provide capital, Fireside Ventures takes a hands-on approach to portfolio company development.
Fireside’s Value-Add Services
- Strategic Guidance: Helping founders navigate the complex consumer landscape and identify optimal channels for reaching Gen Z customers
- Digital Ecosystem Connections: Facilitating partnerships with platforms like Google, Meta, and quick commerce providers
- Leadership Development: Coaching founders through the transition from operators to CEOs
- Brand Management: Developing comprehensive playbooks for brand growth
- Governance Framework: Implementing robust processes and audit mechanisms
Sitaram emphasizes that the ₹100-crore revenue threshold represents a critical inflection point for consumer startups targeting quick commerce Gen Z customers. At this scale, founders must evolve from hands-on problem solvers to effective leaders who can build and manage teams capable of driving growth to the next level.
“We have chosen to play a very active role. We guide start-ups to build consumer companies and also help them in making connections with digital ecosystem like Google and Meta. More recently, as our portfolio companies inch closer to the ₹100-crore mark, we are also helping them in leadership coaching. Founders now find that they need to transition from problem solvers to being good CEOs overseeing everyone.”
FMCG Acquisition Trends and Exit Opportunities
The success of D2C brands in capturing quick commerce Gen Z customers has not gone unnoticed by established FMCG giants. As traditional consumer goods companies struggle to connect with younger demographics and establish presence in emerging channels, acquisitions have become an increasingly attractive strategy.
We have seen many large FMCG players buy D2C start-ups recently. Will we see more such deals?
“When you look at large companies, their market shares are less when it comes to the quick commerce channel, the Gen Z consumers, and other areas that are now on trend. This is why their revenues have been impacted and they are on an acquisition spree. Look at their balance sheets, they are sitting on a huge amount of cash, and we will see more such deals like HUL-Minimalist or ITC-Yoga Bar. It’s up to the D2C founders to decide if they choose to scale on their own or sell.”
Sitaram highlights several factors driving this acquisition wave in the consumer sector:
| Factor | Impact on Acquisition Strategy |
|---|---|
| Channel Gap | Traditional FMCG companies have lower market share in quick commerce compared to their presence in conventional retail |
| Demographic Disconnect | Established brands struggle to connect authentically with Gen Z customers |
| Innovation Velocity | D2C startups can develop and launch new products faster than larger corporations |
| Cash Deployment | Large FMCG players have substantial cash reserves that need to be deployed for growth |
Recent acquisitions like Hindustan Unilever’s purchase of Minimalist and ITC’s acquisition of Yoga Bar exemplify this trend. These transactions provide D2C founders with attractive exit opportunities while giving FMCG corporations instant access to brands that resonate with Gen Z customers and have established presence in quick commerce channels.
Technology Innovation in Consumer Startups
Contrary to perceptions that consumer startups lack technological sophistication, modern D2C brands targeting quick commerce Gen Z customers are increasingly technology-driven. These companies leverage advanced data analytics and digital capabilities to create competitive advantages that help them connect with younger consumers more effectively.
What would you say to people who say consumer start-ups are not cutting-edge enough, and Indian founders must focus beyond these?
“The question to be asked is have consumer ventures created value for India? They have created thousands of jobs, tax and other revenue for the government, and all of this feeds into economic growth. Today’s D2C start-ups are also innovating in technology. They are leveraging data in a big way. They are analysing users’ first party data, and analysing it to acquire, retain customers and sell relevant products to their customers and reduce cost of marketing too.”
Sitaram challenges the perception that consumer startups targeting quick commerce Gen Z customers lack technological sophistication. Modern D2C brands are increasingly technology-driven, leveraging advanced data analytics to optimize their operations:
Technology Innovations in D2C Brands
- First-Party Data Analytics: Using direct customer relationships to gather valuable insights about Gen Z customers
- Customer Acquisition Optimization: Sophisticated targeting to reduce customer acquisition costs
- Retention Algorithms: Predictive models to identify churn risk and increase customer lifetime value
- Product Recommendation Engines: AI-driven tools to increase basket size and repeat purchases
- Marketing Efficiency Systems: Data-driven approaches to optimize marketing spend and ROI, particularly in quick commerce channels
Beyond their technological contributions, consumer startups focused on quick commerce Gen Z customers have created substantial economic value through job creation, tax revenue, and supply chain development, making them a vital part of India’s entrepreneurial ecosystem.
As the funding environment for consumer startups normalizes after the exuberant valuations of 2022, the outlook for D2C brands leveraging quick commerce to reach Gen Z customers remains positive. Fireside Ventures maintains that India’s domestic consumption growth will remain largely insulated from international trade disruptions, supported by demographic dividend, rising disposable incomes, and the continued expansion of digital commerce channels.
India’s consumption growth story remains compelling despite global uncertainties. Our long-term confidence in the Indian consumer’s rising purchasing power and evolving preferences continues to guide our investment approach, particularly in brands that connect effectively with quick commerce Gen Z customers.
As D2C brands continue to refine their strategies for capturing quick commerce Gen Z customers, the partnership between innovative consumer startups and specialized venture capital firms like Fireside Ventures will remain a crucial factor in their growth trajectory. The ability to navigate the rapidly evolving digital commerce landscape while building sustainable, omnichannel businesses will separate the enduring brands from those that merely capitalize on temporary trends.
Published on April 20, 2025 | Updated on April 20, 2025
