Mumbai-based D2C brand SUGAR Cosmetics has raised about $21 Mn in its Series C funding round led by Elevation Capital (formerly SAIF Partners), which has reportedly doubled its valuation to over $100 Mn. Existing investors A91 Partners and India Quotient also participated in this round.
The D2C brand had kickstarted the Series C round in October 2020, after raising $2 Mn of debt from Stride Ventures to meet its working capital needs and inventory requirements. Overall, it has raised about $50 Mn till date.
SUGAR plans to use this latest funding to bolster its research and development (R&D), content creation and expand its distribution abilities. It will also focus on doubling its current INR 200 Cr revenue run rate over the next 12 months. The company intends to sell through 40,000 retail outlets over the next 12-18 months to meet this target.
The D2C brand has a presence in SUGAR-branded stores as well as retail chains such as Shoppers Stop, Lifestyle, Central, Health & Glow, NewU and others. It operates across 2,400 outlets in over 130 cities, with about 1,750 retail touchpoints signed up since 2017. The company has also added over 40 exclusive brand outlets or kiosks in the last three years.
It has also partnered with Amazon, Myntra, Flipkart and Nykaa to boost its ecommerce sales. The partnership did come handy during the Covid-induced lockdown, with about 70%-80% of its sales coming through an online channel in an otherwise offline sales dominated business. The company believes that the offline sale channel will continue to dominate its revenue pipeline in the next five years as well.
SUGAR Cosmetics, founded in 2015 by IIM Ahmedabad alumni Vineeta Singh and Kaushik Mukherjee, manages this vast network though its own central warehouse in Mumbai and a third-party logistics warehouse in Delhi. While Blue Dart, FedEx, ExpressBees and others handle deliveries, coordination for shipping and returns is done by a team at the HQ in Mumbai, which has real-time data and tracking for faster delivery turnaround time.
The revenue in the India beauty and personal care market is projected to reach $26.8 Bn in 2021, with an expectation of a compound annual growth rate (CAGR) of 8.5% till 2025). The market’s largest segment will continue to be personal care with a market volume of $12.2 Bn in 2021. Other players in the segment are Mamaearth, mCaffeine, Bombay Shaving Company and others.