Gurugram-based baby and mother care products startup Mamaearth, on Wednesday (January 8), announced that it has raised INR 130 Cr ($18 Mn) funding from Sequoia India. The funding round also witnessed the participation from existing investors like Fireside Ventures, Stellaris Venture Partners and Sharp Ventures.
The company will be utilising the funds to accelerate growth, launch more brands, hire talent and expand its presence across Southeast Asia. Most importantly, it aims to become a 500 Cr brand by acquiring five million new consumers in the next three years.
Interestingly, the current round witnessed a phenomenal exit for seed investors. For instance, some of the early-stage angel investors who have exited the company in this round reaped a return of over 20x on their initial investment.
Mamaearth was founded by husband-wife duo Varun and Ghazal Alagh in 2016. The direct to consumer fast-moving consumer goods (FMCG) brand is one of Asia’s first made-safe certified brands that offer 100% toxin-free and natural skincare, haircare and baby care products. Currently, the company offers a range of products including 80+ natural and toxic-free products. It has over 1.5 Mn consumers in over 500 cities across India.
In September 2018, Mamaearth had raised INR 27.5 Cr ($4 Mn) in a Series A round led by early-stage technology-focused venture capital firm Stellaris Ventures. Prior to this, the company had also raised $1 Mn in a funding round led by Fireside Ventures and few other investors.
Ishaan Mittal, principal at Sequoia Capital India said that out of India’s $15 Bn personal care market, online channels contribute to only 3-5%. However, in the next seven to eight years, the direct to consumer brands have the potential to redefine the architecture of tomorrow’s FMCG companies, he added.
According to a Technavio report, the Indian baby care market is expected to grow at a CARG of 17% to touch $31 Bn between 2014 to 2019, from $14 Bn. In recent times, a lot of startups have emerged in the market, including The Moms Co, BabyCare, BabyChakra, FirstCry and many more.
Last year, Delhi-based baby care products startup The Moms Co raised INR 35 Cr ($5 Mn) Series B round from existing investors DSG Consumer Partners and Saama Capital. Japanese investment firm SoftBank had also reportedly said to invest $400 Mn in FirstCry, where it had planned to acquire a 40% stake in the company, which was valued at around $600 to $700 Mn.