Mamaearth, one of the fastest-growing FMCG brands to reach a 100 crore run-rate, has raised a round of funding led by Sequoia India with participation from existing investors, Fireside Ventures, Stellaris Venture Partners and Sharp Ventures.
Varun Alagh, Founder and CEO, Mamaearth, said, “We have a long way to go at Honasa (Mamaearth’s parent company). Our vision is to create the FMCG conglomerate of the future by building brands that connect strongly with millennials and Gen Z customers using the combined power of digital marketing and e-Commerce at large scale. Sequoia India’s investment at this stage of our journey validates this vision of building a global brand of the future.”
Across India, millennial consumers are becoming increasingly conscious and are looking for safe natural alternatives to replace the existing cosmetic products being offered by large multinationals. This strong demand has been reflected in Mamaearth’s meteoric growth. Today, their range includes 80+ natural, toxin-free products, with a whopping 1.5 million+ consumers in over 500 cities across India.
Ishaan Mittal, Principal, Sequoia Capital India LLP, stated, “Out of India’s $15B+ personal care market, online channels contribute to only 3-5%. With 15-20% of Indian shoppers influenced digitally and expected to double in the next 7-8 years, digital-first brands have the potential to redefine the architecture of tomorrow’s FMCG companies. Varun’s vision is to ride these market tailwinds to create a multi-brand, cross geo FMCG company over the next decade. The team at Sequoia India is excited about being partners in this phenomenal journey.”
The current round of Rs 130 crore raised by Honasa Consumer Pvt Ltd, the parent company of Mamaearth, is the biggest round size for any internet-first consumer company in India. The round has also been particularly noteworthy because it's seen as a phenomenal exit for seed investors. Some early angels have exited the company in this round with a return of over 20X on their initial investment. For a D2C FMCG brand, such an exit is almost unprecedented.
Kannan Sitaram of Fireside Ventures added, “As first institutional investors in Mamaearth, this round has strengthened our philosophy of backing the right founders who are looking to build the next generation of great Indian brands. We believe the journey has just begun and the team will take the company to new heights.”
MamaEarth is driven by innovation and uses the best of science and Ayurveda to stand out in the personal care space. The brand combines in-depth research and customer feedback to create best-in-class products for the young, aspirational and increasingly conscious Indian consumer.
Ghazal Alagh, Co-Founder, who is also Chief Mama for the Brand, said, “From day one we have ensured we listen to our consumers and provide products which they were looking for. This led us to develop & launch over 80 products in under three years. Last year, for instance, we noticed that our consumers were using onion juice as the ultimate household remedy for hair loss. That's when we launched our onion range of hair care products and saw phenomenal results. This has now become a part of our DNA & in the coming years we will continue to launch new products, enter new categories & use the right ingredients based on our listening tools.”
The company plans to use the freshly acquired funds over the next 3 years to continue its exponential growth, building it into a 500 crore brand by acquiring 5 million new consumers. The funds will also be used to launch more brands under the Honasa umbrella, all of which will be internet-first and focused on the needs of the new-age, millennial consumers.
Apart from this, the company plans to utilize the funds to hire best-in-class talent as the organization scales rapidly. There are also plans to expand into key markets in Southeast Asia, where the presence of a similar millennial audience lends its strong market potential.
Rahul Chowdhri of Stellaris Venture Partners said, “We invested early in Mamaearth on back of consumer trend of a healthy lifestyle and stellar founders. It is encouraging to see the way consumers have loved the goodness of this brand. We look forward to being part of Varun & Ghazal’s journey of building a long-lasting business.”