The Indian health supplements industry stands at a critical crossroads, caught between explosive growth and deep-seated consumer skepticism. While some view these products as modern-day snake oil, others swear by their transformative benefits, creating a market paradox that nearly 500 startups are racing to solve.
The Consumer Dilemma: Success Stories and Cautionary Tales
Chennai businessman Fahad Javeed represents the converted believer. The 35-year-old had always been doubtful about health supplements until his wife achieved remarkable results. She lost 10 kilograms in three months using Metabolically Lean, a product from The Good Bug that also resolved her chronic bloating issues. This personal testimony prompted Javeed to try Gut Cleanse from the same company.
However, marketing professional Ryan Frantz, also from Chennai, experienced the opposite outcome. After using Metabolically Lean for two months without seeing any noticeable weight change, the 46-year-old discontinued the product. His concerns deepened when his doctor diagnosed him with fatty liver and suggested it might be linked to supplement consumption.
Market Boom Amid Regulatory Challenges
The COVID-19 pandemic triggered unprecedented growth in India's health supplements sector. According to consulting firm IMARC, the overall nutraceutical market will reach $8 billion in 2025. Investment data from Tracxn reveals that 478 active startups have collectively raised almost $635 million across 222 funding rounds, including over $52 million in 2025 alone.
Major corporate players have taken notice. Reliance Industries acquired a majority stake in Naturedge Beverages, while Hindustan Unilever and Marico purchased controlling interests in OZiva and Plix respectively. In September 2025, Ayurvedic brand Kapiva announced a $28 million funding round with an additional $32 million secondary component.
Despite this dynamism, the industry faces a fundamental trust problem rooted in regulatory classification. Nutraceuticals fall under FSSAI jurisdiction as food products, unlike drugs that face stricter CDSCO oversight. This distinction allows supplements to claim they "help improve sleep quality" but prevents them from claiming to "treat sleep disorders."
Legal expert Biplab Lenin of Cyril Amarchand Mangaldas explains the regulatory gap: "FSSAI may not specifically test the final product for efficacy or verify its claimed functional benefits." This framework enables widespread outsourcing and white-labeling, with startups frequently relying on contract manufacturers like Ahmedabad-based Brukem Life Sciences and Padmavati Nutraceuticals.
Building Trust Through Clinical Validation
Progressive startups are investing heavily in clinical trials to distinguish themselves. Kapiva founder Ameve Sharma, who comes from the family behind the 108-year-old Baidyanath Ayurved brand, revealed his company is finalizing a partnership with KMC Hospital in Manipal. They plan to conduct double-blind, randomized, placebo-controlled trials for their diabetes product, with ambitions to publish results in global journals.
"If you want to build a ₹30 crore or ₹50 crore business in the short term, you can do that with just pure marketing," said Sharma, whose company targets ₹600 crore revenue this fiscal year. "But if your product doesn't deliver results consistently in a measurable way, you're not going to last long-term."
The costs are substantial - basic third-party trials start at ₹1 crore, rigorous phase-IV trials around ₹10 crore, and advanced studies like Kapiva's can reach ₹25 crore. Despite the expense, companies like The Good Bug, Wellbeing Nutrition, and Unived are committing to various forms of clinical validation and batch testing.
Innovative Approaches to Consumer Confidence
Startups are adopting multiple strategies to overcome skepticism. The Good Bug co-founder Keshav Biyani emphasizes expectation management: "With Metabolically Lean, you have to be consistent. If you are going to continue having sugar, fried food, and then expect this to work like magic, it is not going to happen."
Ace Blend takes a problem-focused approach, developing specialized products like IBS Gastro Pro that target specific quality-of-life issues. Founder Shivam Hingorani states, "If you are investing your time, changing your habits and including a supplement in your life, it better yield results. We are in the efficacy game."
Traya Health combines dermatology, nutrition, and Ayurveda in their hair loss treatment kits. After realizing customers lacked patience for the five-month treatment period, they added dedicated coaches and dermatologist consultations. The company has now served over 1.5 million customers and crossed ₹500 crore in revenue, recently expanding to 12 physical centers to build offline trust.
Medical community endorsement remains crucial. Wellbeing Nutrition founder Avnish Chhabria reports that 20% of their sales come from doctor prescriptions, including use for patients with sarcopenia and those undergoing chemotherapy.
The Road Ahead: Quality Over Quick Wins
Industry veterans stress that sustainable success requires moving beyond marketing-driven approaches. Amit Mehta, founder of vegan nutraceutical brand Unived, critiques new entrants: "A lot of them have come in with a business opportunity mindset and with zero understanding of what nutraceuticals are. They just reach out to third-party manufacturers who can ship 100 products overnight. You are not a health and wellness company then, just a marketing company."
Plix co-founder Akash Zaveri highlights the importance of authentic customer feedback in the digital age: "You can see their reviews and feedback on not just our website, but also on marketplaces and social media platforms. Strong nutraceutical businesses are all built on products."
As the industry matures, founders acknowledge that trust building requires long-term commitment. For consumers like Fahad Javeed, whose mother-in-law and friends have now joined him in using supplements, personal results remain the most convincing evidence. The industry's future hinges on whether more companies can deliver such positive experiences consistently, transforming skepticism into sustained confidence.
