Specialty Chemicals Platform Distil Raises $3.1 Million in Seed Funding Round

Specialty chemicals platform Distil has secured $3.1 million in a seed funding round led by Jungle Ventures and India Quotient, with additional participation from other investors and industry operators. This marks Jungle Ventures’ first seed investment in India since launching its First Cheque@Jungle program, which aims to invest at least $2 million in early-stage startups from idea to seed stage.

The newly raised funds will be directed towards expanding Distil’s teams in sales, research and development (R&D), and other key areas. The company also plans to develop proprietary products, positioning itself as a leading specialty chemicals franchise in the life sciences segment, encompassing flavours and fragrances, food ingredients, pharmaceuticals, and personal care products. Distil aims to cater to both the Indian market and international markets, including the United States, European Union, and the MENA (Middle East and North Africa) region.

Founded by IIT Bombay alumni Atanuu Agarrwal, Karan Hirani, and Viraj Shah, Distil provides fully customizable and scalable solutions through a tech-enabled platform for the procurement of specialty chemicals. The company addresses various inefficiencies plaguing the specialty chemicals value chain, such as fragmentation with multiple intermediaries, unreliable quality, long lead times, and challenges posed by minimum order quantities.

Distil’s offerings include tailored formulations and custom manufacturing, designed to help manufacturers meet specific performance and regulatory requirements. "At Distil, we recognize a once-in-a-generation opportunity to build a global leader in R&D-led specialty chemicals from India," said Atanuu Agarrwal, co-founder and CEO of Distil. "The support from our partners and investors, particularly Jungle Ventures and India Quotient, marks a significant milestone as we scale our operations. We are grateful for their trust and excited about the journey ahead."

The First Cheque@Jungle program, run by the Singapore-based venture capital firm, seeks 50% of the investment as equity and the remainder in no-cap convertible notes. A convertible note cap is the maximum valuation at which the investment made via the convertible note can convert into equity.

"We are pleased to lead this funding round for Distil. Their focus on solving supply chain challenges through R&D and technology aligns perfectly with our investment philosophy," said Rishab Malik, partner for Seed Investments at Jungle Ventures. "The founding team is exceptionally strong, with a mix of a second-time founder and seasoned operators with over 15 years of experience in the specialty chemicals domain."

The specialty chemicals industry in India is poised for significant growth, driven by increasing demand in sectors such as pharmaceuticals, personal care, and food ingredients. Distil’s innovative approach and robust technology platform position it well to capitalize on this growth, offering efficient and reliable solutions to manufacturers both domestically and internationally.

Recent funding trends highlight the growing interest in the specialty chemicals sector. For instance, venture debt firm Stride Ventures, early-stage venture capital firm IvyCap Ventures, and technology-focused investor Filter Capital have all closed significant funding rounds in recent months. This influx of capital is expected to drive innovation and expansion across the industry, with Distil positioned as a key player in this evolving landscape.