The funding boom that saw India turning into the home of more than 40 unicorns?and the startup ecosystem raising?nearly $36 billion in 2021,?seems to have carried into the new year 2022 as well, as we already have our first unicorn of 2022!??
The parent company of personal care brands including Mamaearth and The Derma Co, Honasa Consumer, announced on January 1 2022 that it has raised $52 million in a round led by Sequoia, leading to its valuation soaring to $1.2 billion.
After raising $50 million in a funding round led by Sofina Ventures that saw its valuation rising to $730 million, this latest funding of Mamaearth included investments from Ventures SA and Evolvence.
The Co-Founder and CEO of Honasa Consumer said that the company aims to deploy the funds towards brand launches, expanding distribution, inorganic growth, and expanding the current portfolio across borders.
Although the company said that this round also gave employees an opportunity to sell their vested ESOP (employee stock option plans), it did not specify the quantum or how many would benefit from it.
Other investors of Honasa Consumer include Fireside Ventures and Stellaris Venture Partners.
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Founded in 2016 by the husband-wife duo of Varun and Ghazal Alagh, Mamaearth has undoubtedly emerged as one of the hottest new-age consumer brands in India, especially in the direct-to-consumer (D2C) segment. In this segment, brands directly sell to consumers from their website or via e-commerce platforms, instead of going the traditional and expensive offline route or involving any other intermediaries
Mamaearth offers more than 80 toxin-free, natural products, including bamboo-based baby wipes, face masks, lotions, and hair care products. The second brand under Honasa Consumer, named Derma Co, was launched in late 2019.
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Mamaearth¡¯s Varun Alagh also stated recently that the company has turned profitable in the financial year 2021 and expects to close this quarter ending March 2022 by doubling the revenue to nearly 960 crore, after growing it nearly fourfold in the last financial year 2020-21 to ?480 crore.
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Working towards this aim, he says the company will focus on inorganic growth, launching more brands and doubling down on its distributions.?Mamaearth also plans to use the funding money to expand its portfolio of personal care D2C brands.?
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Mamaearth¡¯s Varun Alagh also said that looking at the scale of Mamaearth and the success of The Derma Co, he is confident that they have the expertise to build brands with a millennial connect And with Sequoia, Sofina and Evolvence having unique strengths in the US, Europe & GCC, respectively, this will help them grow internationally & learn from others in these markets.
Mostly, D2C brands begin by selling their products online and are assisted by other e-commerce marketplaces such as Flipkart, Myntra, and Amazon. And the sectors that have turned out to be the most lucrative for D2C brands at present include beauty and personal care, food and beverage (F&B), and fashion.
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