There has been a huge boost in the beauty industry as the various startups belonging to this domain have seen double the number of investments as compared to last year. Speaking in terms of numbers, the investment in the beauty and cosmetics field reached a gross $108 million in the year 2019, which is shockingly high as compared to $51 million in 2018. Not only this, the sheer number of deals and contract signed have reached up to twelve as compared to seven in the previous years.
The small startups and the big established ones alike have seen a huge pump in their growth by coming into business and partnerships. Nykaa for example struck a deal in April which costed around $14. This in turn added to and yielded a valuation to Nykaa of about $700 million. Similarly, the MyGlamm added some $19 million from Bessemer Ventures. This was the take that the big established names have shown. As per data collected from Venture Intelligence, smaller firms like Sauce.VC and Roots Ventures are also spinning into action to play their cards.
This realm of cosmetics and skin care products is supposed to catch up speed and amp up the business in return due to the movement and increased attention of people towards wellness and fashion consciousness. This will act as a fertile ground for many startups and will in return create business opportunities.
“With the success of Nykaa, similar companies within the segment are coming up and are seeing investor attention,” said Venture Intelligence MD Arun Natarajan
The business analyst have studied the steady and gradual upscale movement of this category and have concluded it to have the potential of not just attracting small scale investments. This category shows the potential to incorporate growth stage funds.
Not only this, the beauty products are seeing a pump and is luring in large number of audience. Among them, Grofers’ Orange Something and Mahesh Bhupati aided Scentials are showing an increased customer involvement. Due to these reasons, the investors see potential in this domain and are running away from the chaotic high margin business. These home grown brands show a lot of capabilities and is currently showing many winsome potential.
Moreover there are a number of foreign players who want to test Indian waters and sell their brands in India. This is affecting the vertical completely and all consumer companies the growth rate has become stellar and multiplied by 2-3 times.
“Consumers are becoming increasingly aware today and do not subscribe to a one-size-fits-all approach offered by traditional, off-the-shelf products. When it comes to personal care and beauty, they want a unique solution and a perfect look that works for them. We are keen to back founders and brands with a clear plan for sustainable and profitable growth, and have put in money on Bare Anatomy, which builds a long-term relationship with the customer,” managing partner Manu Chandra, Sauce.VC said.
Via – Times of India