New Delhi: Alternative dairy startup 1.5 Degree has raised $1 million in a Pre Series A round led by 35North Venture’s India Discovery Fund II, as it steps up its focus on supplying plant based products to large foodservice clients. The company plans to use the capital to expand manufacturing capacity, strengthen partnerships with institutional buyers and enter five high demand markets including Mumbai, Pune, Bengaluru, Hyderabad and Delhi. These cities together account for a large share of India’s organised foodservice volumes.
Operating under Natturz Bio Kontrol Pvt Ltd, 1.5 Degree is building its business around corporate cafeterias, hotels, schools and large dining operators, rather than relying on retail adoption in the early phase. The company works with global foodservice providers such as Compass Group and Sodexo, supplying a wide portfolio that spans oat milk beverages, frozen desserts, gelatos, yogurt bowls, tofu, cooking cream and plant based milk.
India’s dairy market is valued at about Rs 18.9 trillion, but plant based options continue to face taste and price barriers. 1.5 Degree says it has developed an AI aided processing method that addresses the off flavour issue commonly associated with oat milk and other alternatives. The company also points to environmental gains from its products, citing lower water use, reduced greenhouse gas emissions and zero cholesterol compared to conventional dairy.
Around 80 percent of the company’s revenue currently comes from long term institutional contracts, providing predictable volumes and repeat orders. The operating model includes volume linked pricing, integrated ordering systems and cold chain partnerships to serve clients across multiple cities.
Alongside its core B2B focus, 1.5 Degree is preparing to pilot direct to consumer formats through premium retail parlours and delivery led kitchens in select metros, listed on food delivery platforms. The company expects this channel to play a supporting role while institutions remain its main growth engine.
35North Venture’s India Discovery Fund II said the investment is aimed at backing scalable food platforms that combine sustainability goals with commercial discipline, as large organisations face growing pressure to offer healthier and lower impact food options to employees and customers.
