With a fundraising of $52 million, Honasa Consumer, the parent company of the popular brand Mamaearth becomes a hot topic of discussion in the FMCG industry.
Honasa Consumer, a unique care-focused e-commerce platform that sells products under the Mamaearth, The Derma Co, and House of Brands labels, announced on Saturday that it had raised $52 million in a new funding round led by Sequoia Capital, valuing it at $1.2 billion.
The brand, which created toxin-free goods and was founded by Varun Alagh and his wife Ghazal Alagh in 2016, has also established seven brick-and-mortar stores this year. It intends to expand the stores to the top 20 cities with the highest sales. The goods are also available on Amazon, Flipkart, and Nykaa, among other online marketplaces.
According to the Gururam-based firm, the latest funding round included participation from Belgium-based investment fund Sofina Ventures and the UAE-based India-focused fund Evolvence Capital. Fireside Ventures and Stellaris Venture Partners had previously invested in the company. Employees have been able to cash in on their vested ESOPs due to the round (employee stock option plans). Honasa said in a statement on Saturday that the funds will be used to develop its portfolio of personal care D2C (direct-to-consumer) brands, product innovation, distribution, and marketing.
Aqualogica, a hydration-based skincare brand, was its most recent entry into the skincare segment. It also intends to use the resources to finance inorganic growth possibilities in the beauty and personal care industries.
Varun Alagh, co-founder and CEO of Honasa, stated that their flagship brand Mamaearth is a leader in the D2C personal care category and that The Derma Co is on the right track. Sequoia, Sofina, and Evolvence, he added, have distinct capabilities in the US, European, and GCC markets, which will help the company expand internationally and learn from others in these sectors.
“Since millennials’ personal care concerns are dynamic, and with our direct-to-consumer approach, we’ve been able to build an extensive portfolio of products across the baby care, skincare, haircare, and colour cosmetics under Mamaearth and a portfolio of over 40 products under The Derma Co,” said Honasa co-founder and Chief Investment Officer Ghazal Alagh.
Ishaan Mittal, Managing Director of Sequoia India, stated that as digital channels influence the discovery and consumption of FMCG companies, it is creating a unique opportunity for entrepreneurs to establish brands of the future.
“Mamaearth has established itself as a clear market leader in this digital-first consumer goods space and Sequoia is delighted to double-down on the partnership in this journey.” The GCC (Gulf Cooperation Council) market, according to Rohit Batra, managing partner at Evolvence, would be receptive to the Honasa brands, particularly Mamaearth, and early indicators have been encouraging as the company scales in the region.
Honasa is a five-year-old company with Mamaearth, The Derma Co, and Aqualogica that reach out to over 1,000 locations. It claims to have sold them for a total of $1 billion. Honasa will continue aggressively growing distribution for existing brands Mamaearth and The Derma Co., as well as pursue strategic inorganic development prospects in the beauty and personal care market, in addition to establishing new brands. “We’ll also beef up our IT capabilities, as our technology and data-driven mindset are our primary differentiators from the big incumbents,” Alagh added.