FUNDING OF COSMETICS AND BEAUTY STARTUPS DOUBLES TO $108 MILLION THIS YEAR

FUNDING OF COSMETICS AND BEAUTY STARTUPS DOUBLES TO $108 MILLION THIS YEAR

FUNDING OF COSMETICS AND BEAUTY STARTUPSDOUBLES TO $108 MILLION THIS YEAR

Inthe last few years, India's beauty and person care industry is on a roll, allbecause of the online sales of products, premiumisation, and an inclinationtowards organic and ethical brands.

Asper the report of Euromonitor International, online retailers like Nykaa andAmazon have given a boom to the industry and it has crossed $400 million ininternet sales up from $100 million in 2014.

Apartfrom the different driving forces behind this boom, investment has played amajor role. Many start-ups belonging to this domain have seen double in thenumber of investments as compared to the last year. This year, the investmentin beauty and cosmetics has reached a gross $108 million in 2019 that isshockingly high as compared to $51 million in 2018. The number of deals alsoincreased from seven to 12.

InApril 2019, Nykaa saw a deal of $14 million in April that raised its valuationto over $700 million while MyGlamm brought in $19 million from BessemerVentures. Moreover, smaller firms like Roots Ventures and Sauce.VC is alsocreating its place in the market.

Inrecent times, the emerging starts have gone through a great upsurge in businessand partnerships. In April, Nykaa struck a deal, which cost around $14. It inresults added to and yielded a valuation to the company of about $700 million.In the same way, MyGlamm added about $19 million from Bessemer Ventures.

Thisrealm of skincare and beauty products is expected to grow at a rapid pace andamp up the venture in the result because of the demand and raising attention ofpeople for wellness and beauty consciousness. They are eagerly trying neweroptions and purchasing cosmetics and various skincare products. The increasingdemand and use have created business opportunities for start-ups in thecosmetics and beauty industry. 

Thesebeauty products are watching a huge increment in the number of audiences on aregular basis. Among Amazon's big deals and Flipkart's Deal of the Day, thesestartups are writing a new phase with good revenue generation. That the why;investors are getting potential in this domain and are shifting from thechaotic high margin business to this emerging cosmetic business. And, raisinghomegrown brands are presenting a lot of capabilities and are currently showingmuch winsome potential.

Furthermore,many foreign players are looking forward to starting their venture in India andsell their brands. This is bringing great impact on the industry overall andall consumer companies the growth rate has become stellar and multiplied by 2-3times.

In this modern age, consumers are becoming aware of personal care and beauty, now they do not subscribe to a one-size-fits-all approach offered by traditional, off-the-shelf products. They are looking for a unique and customized solution according to their look, body structure, and skin. VCs and investors are keen to invest in start-ups, who have a clear plan for sustainable and profitable growth.

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