Project Areca - from Villain to Hero

Project Areca - from Villain to Hero

Mystic Aromatics

3. Good Health and Well-Being 8. Decent Work and Economic Growth 9. Industry, Innovation and Infrastructure 12. Responsible Consumption and Production

Overview

Mystic Aromatics is a manufacturer of areca-nut based products - Areca Tea, a healthy organic beverage made of areca nut and paper air fresheners made from areca husk and recycled papers. Up until then, areca nut was used only in Gutka production that causes oral cancer. Innovations at Mystic aromatics helped to change the bad reputation associated with areca nut from killer to savior.

The innovation helped farmers to add value to their agricultural produce, gave employment to the underprivileged people, promoted recycling, and finally helped to reduce air pollution in the region.

Authors

Jeevan Lawrence

Jeevan Lawrence

Garima Ranga

Garima Ranga

Radhika K R

Radhika K R

School

Goa Institute of Management

Goa Institute of Management

Professor

Divya Singhal

Divya Singhal

Innovation

The year 2013 was a period of farmer unrest in the Malenadu region triggered by the news that Gutka could be banned in the country as it causes oral cancer. During this time Mr. Nivedan conceived the idea of developing an alternate product out of areca which is otherwise used only in the production of Gutka.

As a pharmacist, Nevadan started working on the photochemistry of the areca nut and sent it to labs for chemical identification. He also collected research papers published on areca all around the globe and found that it contains aqueous tannins and many useful chemicals such as antioxidants, Proline (Amino Acids) and digestive enzyme enhancing agents. With all the information he had collected, he started working on developing a new product out of areca-nut. Extracting tannins from areca-nut, resulting from his extensive research, Mr. Nivedan introduced to the world a new product for tea lovers – Areca Tea, a healthy beverage. Dip teabags comprise 80 per cent areca extract and 20 per cent herbs. Mr. Nivedan claims that Areca Tea helps control diabetes and LDL cholesterol which has been clinically proven.

The product was an instant hit and today Areca Tea is exported to more than Twelve countries. Mr. Nivedan received wide appreciation from the farmers community for reducing insecurity among them due to their sole dependence on Gutka production. This was followed by numerous national awards.

This huge success of Areca Tea inspired Mr. Nivedan to experiment more with Areca. One of the major problems with areca nut production was the huge pile of areca husk, which is usually burnt by farmers, thus causing air pollution. This made him think, what if an alternate use can be unearthed for areca husk? The pollution could be kept under control.

After brief research and lab tests, Mr. Nivedan found that areca husk has a high moisture retention capacity compared to paper. This made him experiment with areca husk and perfume which was his original business. He used areca husk instead of paper to contain the perfume. After an in-depth study and trials lasting for almost six months, Mr. Nivedan introduced the world to paper air fresheners - the air freshener made from areca husk.

The air fresheners are made for use in cars and wardrobes. Not only are these air fresheners reasonably priced, but customers can customize air fresheners. The buyer has the option of selecting a design along with their choice of fragrance. Soon after this, Mr. Nivedan launched perfumed business cards made from areca husk.

Mr. Nivedan said, “not only are the air fresheners are biodegradable, but also the ink used is lead-free. The technology is very new, that all over India we only have this patented technology. Most products available in the market are synthetic and this is the only product that is made out of agricultural produce."

He also added that, “We are trying to prove that there is no waste in agricultural produce, there’s nothing a waste in nature. It’s only that the real use isn’t discovered yet. Also, in this way we are trying to inspire sustainable inventions."

Mr. Nivedan is now working on innovating more by-products of areca-nut and other agricultural produces, to further enhance the income of farmers. His dream is to present to the world an array of nature-based sustainable innovations which uphold true Indian heritage.


Project Areca - from Villain to Hero

Inspiration

After returning from Australia in 2013, Mr. Nivedan started a company called ‘Mystic Aromatics’ in his village Mandagadde. He started producing organic aromatic candles. However, way back in 2013 in India, perfumery candles were considered a luxury. People were using candles only during an electricity power cut. And the candles were a bit pricy compared to normal candles. Therefore, the market did not respond well to his product. Due to low demand, he incurred a huge loss. Soon after some time, he decided to make a comeback with an organic perfume with natural blending, giving a new fragrance. During those days people were not familiar with organic products. So, it did not make a big impact in the market and so the second product was also a failure.

After series of setbacks, he decided to approach a bank for a loan in 2014. He shared that, "when he met the general manager and gave his business card. The manager in front of him folded his business card, rejecting his loan application." This incident made Mr. Nivedan realize that his business card carries no value to the manager. So he thought, what if he could make such a business card that everyone wants to keep with them? This is where he conceived the idea of using his expertise in organic perfume-making into producing an aromatic business card.

To introduce an aromatic business card, Mr. Nivedan developed a print technology called ‘Perfumery printing technology’, a technology that he claims no one has in India to date. A separate printer was developed for this purpose, where a business card can hold fragrance for up to two years.

But this time, learning from his past mistakes, Mr. Nivedan did a proper market study before launching the product. He realized that many aspiring entrepreneurs, business executives particularly in sales and marketing were facing an identity crisis, just like what he had experienced with the manager of a bank. Being from a pharma background, he first introduced the product to pharmaceutical representatives and the rest is history.

Eventually, Mr. Nivedan thought of introducing paper-based air fresheners for cars and wardrobes. However, there were many big national players already in the market. He knew that for a start-up it is difficult to compete with such established brands. So, he found a new niche segment – small car workshops, small car showrooms, etc., with their names or logo printed on it. They could order as little as 50 pieces, which was not something large companies use to offer. Mr. Nivedan, who had taken an oath of never harming the environment in any manner, used recycled papers for producing paper air fresheners.

Today the brand is simply known as ‘Paper Air Fresheners,’ which supplies bulk orders to large car franchisees of Maruti Suzuki, Hyundai, KIA, and many more. Today the brand has turned into a major B2B supplier of car paper perfume. The company was using recycled papers, cotton, and other raw materials for producing air fresheners.

During 2013, a period of farmer unrest in the region triggered by news that Gutka could be banned in the country as it causes oral cancer, a friend of Nivedan asked him,” You are an inventor, can’t you help these poor farmers?”. This made Mr. Nivedan think of developing an alternate product out of areca which is otherwise used only in the production of Gutka. Besides this, he also wanted to change the bad image associated with areca nut as a ‘killer’, which was the main source of income for many families in his region. And that’s how Areca Tea was born.

After the huge success of Areca Tea – where the innovation was inspired by areca farmers' problems, Mr. Nivedan realized that problems are in fact an opportunity, the bigger the problem bigger the opportunity to serve people. It was while exploring possibilities of developing other alternate products from areca, he read in a regional newspaper about the problem of burning areca husk (Outer layer of areca, a waste material) by farmers. This was causing environmental pollution in the region.

During his research with areca husk, he found that areca husk has high liquid retention power such as water or oil. So, he thought why can’t he use areca husk instead of paper in his paper perfume product? It can not only make the product better but also can help reduce the air pollution problem. After months of research and trials, Mr. Nivedan had his areca husk-based car and wardrobe perfume ready to conquer the market.

Today both his flagship products – Areca Tea and Paper Air Fresheners use areca as a primary raw material. Interestingly there is also a recycled paper variant of paper air fresheners offered to customers.


Overall impact

The inventions at Mystic Aromatics helped areca farmers to get better value out of their agricultural produce. The Areca Tea helped to shift the consumption pattern of areca from a toxic chewing tobacco preparation that causes oral cancer into a healthy beverage. Paper Air Fresheners helped to reduce pollution and promote recycling. The inventions helped reduce uncertainty among farmers and gave consumers a healthy beverage and an organic air freshener.

Today Areca Tea is exported to more than twelve countries including Russia, Netherlands, Latvia etc. Areca Tea is sold through regular dealerships and online marketplaces such as Amazon and Flipkart. Paper Air Fresheners has become a major B2B supplier of car perfumes to several reputed companies including Maruti Suzuki, Hyundai, and KIA motors.

‘Areca Tea’ won the ‘Make in India Excellence – Innovative Product of the year 2015’ award and many more in the later years.

Business benefit

Both areca-based products of ‘Mystic Aromatics’, helped Mr. Nivedan to thrive in business. The success of ‘Areca Tea’ proved that even an ordinary man from a village can dream big. Areca Tea made way for further inventions. Areca husk-based air freshener, areca-based sanitizer, etc is a continuation of his success story.

‘Areca Tea’ and ‘Paper Air Fresheners’ made ‘Mystic Aromatics’ a 600 crore (USD 80 million) company in a short span of eight years. It was in fact ‘Areca Tea’ that gave the company a new identity. 'Areca Tea' is exported to Twelve countries.

The popularity of ‘Areca Tea’ and ‘Paper Air Fresheners' made Mr. Nivedan a very well-known inventor and business figure in India. This has inspired many young entrepreneurs and inventors from villages to come forward with new initiatives and ideas.

Mr. Nivedan has managed to create separate identities for his products as one being B2C (Areca Tea) and the other being B2B (Paper Air Fresheners). Both products are offered under the brand name ‘Mystic Aromatics’.

Mr. Nivedan’s upcoming innovation is an Areca based shampoo. He says with this invention he wants to give a message to people, “A lot many things can be tried out of areca nut. It was not meant just for gutka”. He has also applied for a patent for a value-added product out of sugarcane to help enhance the income of sugarcane farmers in the region.


Social and environmental benefit

Impact on Society:

Mr. Nivedan says that, “Business opportunities are hidden in social problems; the bigger the problem, the bigger the opportunity”. The idea of developing Areca Tea came from a problem – a possible ban on Gutka products in the country, on which entire areca cultivation was dependent. Similarly, the problem of air pollution caused by areca husk inspired paper air freshener. He has also invented a sanitizer using areca during the pandemic. He identifies himself as a ‘problem solver’ rather than an entrepreneur.

According to Mr. Nivedan, Areca Tea also has health benefits. Areca Tea is clinically proven that it is effective in controlling diabetes. It improves metabolism and thus helps in bringing down sugar levels. Its ability to eliminate LDL cholesterol is also documented.

According to him, an estimated 8 lakh people (0.8 million) are dependent on areca cultivation in the Malenadu and Karvavali region of Karnataka and it gives direct and indirect employment to millions of people all over India. India is the largest producer of areca in the world, and Karnataka is the largest producing state. By introducing Areca Tea, Mr. Nivedan has given a sense of security, hope to millions of people all over India, particularly in the Malenadu region that mostly depends on areca cultivation for their livelihood.

Youngsters these days migrate to big cities or fly to foreign countries to achieve big. Being in a village, they think they are at a disadvantage. But Mr. Nivedan decided to stay and operate from the same village where it all started. By operating from a village, a large firm that is also into exports, he wants to convey to the aspiring youngsters that, “Anything can be done from a village, it need not have to be from the city”. He intends to inspire young entrepreneurs to set up firms in villages and thereby help in employment generation in the region.

According to Mr. Nivedan, his organization has given employment to more than 300 people. Mr. Nivedan has a special preference for employing physically disabled, aged (Above 60) in his production unit. As an inventor, he can use modern machines and equipment to manufacture products economically and efficiently. However, he intentionally chose people instead of machines in the production facility, as he considers his organization a ‘social enterprise’. He says, “How I make money matters”. Along with making a reasonable profit, he also wants to give a ray of hope to the less privileged, whom the family, society think are a burden to them.

Impact on Environment:

Mr. Nivedan said that he follows a strict code of not harming the environment while doing business. He claims the technology, materials that they use are eco-friendly. The lead-free printing technology, recycled papers, use of areca husk and reduced dependence on machines make their products not just biodegradable but environmentally responsible.

The recycled variant of Paper Air Fresheners promotes recycling of paper, could inspire others to innovate further with recycled materials. By using areca husk in the other variant of paper air freshener, burning of areca husk by farmers causing air pollution can be minimized. Besides this, areca growers can also get an additional income out of areca husk. More reliance on manual labor instead of machines in the production facility not only generates more employment but also ensures reduced pollution.

Through his inventions, Mr. Nivedan wants to convey a message to the society, “Nothing is a waste in the environment, everything has its value and use, you only need to discover it”.


Interview

Mr Nivedan Nempe, Founder

Photo of interviewee

Keep this story going! Share below!

Mystic Aromatics

Mystic Aromatics

Shivamogga, Karnataka, IN

Business Website: http://paperairfresheners.in/ & https://arecatea.in/

Year Founded: 2013

Number of Employees: 201 to 500

Mystic Aromatics is a manufacturer of areca-nut based products – ‘Paper Perfumes’ and ‘Areca Tea’. It was established by Mr. Nivedan Nempe in a small village called Mandagadde in Shivamogga district of Karnataka state, India in the year 2013. The company was started in a small, rented building in the village and today it has grown into an INR 600 crore (USD 80 million) company. Interestingly the company is still based in the village and hasn’t shifted its operations to a more convenient location although they are involved in national and international sales.

The founder of Mystic aromatics, Mr. Nivedan Nempe is a well-known young innovator in India. He is a recipient of multiple awards and honors for his business innovations including Make in India Excellency Award 2015, Innovative Product of the year 2015 (For Areca Tea), The Indian Council of Food and Agriculture - Best Agriculture Start-up of the year 2018, Prestigious Brands of India 2019 by Brand Advertising Research and Consulting Pvt Ltd (BARC), Asia and many more. He is an alumnus of the Swinburne University of Technology having his master’s degree in manufacturing engineering technology. After his studies he has served as a business development consultant in Australia, New Zealand, Hong-Kong, Bangkok and Singapore. However, his love for his motherland and his people, brought him back to Mandagadde, the village where he was born.

Having his bachelor’s degree in pharmacy and from an agriculturist family background, Mr. Nivedan’s knowledge about areca nut – the main crop in Malenadu and Karavali region of Karnataka made him tap the goodness of this nut. His innovation with areca helped to shift its consumption pattern from ‘Gutka’ (a sweetened mixture of chewing tobacco) that cause oral cancer into a healthy beverage. This was followed by transforming the waste areca husk which is usually burnt by framers causing air pollution in the region, into a paper air freshener. People are now looking at areca not as a killer, but as a savior of life!