Less than a month after raising $11.32 Mn in funding, online beauty marketplace Nykaa has raised $24.45 Mn (INR 165 Cr) in Series D funding round.
A few of the early stage investors including Sunil Kant Munjal, Chairman, Hero Corporate Service Private Ltd, Family Offices of Harsh Mariwala and Dalip Pathak, private equity veteran have reinvested in this round among others.
The funding round is expected to help the startup fund its growth capital and expand its retail footprint. It further aims to fuel its plans towards expanding its offline presence from 17 stores currently to about 55 stores by FY19-end.
Commenting on the development, Falguni Nayar, CEO of Nykaa said, ‘The focus of Nykaa has always been customer centricity resting on curation, content and convenience. Advice, education and conversations with our customers are key elements of Nykaa’s philosophy and we have recently launched Nykaa Network to build on our consumer centricity.”
In FY18, Nykaa recorded over $86.09 Mn (INR 570 Cr) in net revenue in FY18 from $32.32 Mn (INR 214 Cr) a year earlier and is now looking to hit profitability soon.
With brands like M.A.C, Bobbi Brown, Clinique, Estee Lauder and Smashbox Cosmetics online on the platform, today the luxury vertical accounts for 15% of its total revenue, claims Nykaa team.
Nykaa, launched in July 2012, is an online marketplace for beauty and wellness products and has been continuously expanding its offline presence in the country and offers over 850 brands and 100,000 products. In an earlier conversation with Inc42, Nayar revealed that “the gross merchandising volume for the year ending March 2017 touched $43.3 Mn (INR 280 Cr), with an average of 10,000 orders per day across all the platforms (online and offline).”
Since 2015, Nykaa has taken an omnichannel approach to beauty retail, opening stores across the country. Nykaa currently has stores in India in two formats – Nykaa Luxe and Nykaa On Trend. The On Trend stores offer a unique curatorial experience featuring bestselling products chosen from over 100 beauty brands, while the Luxe format focusses on the complete offering from the prestigious beauty brands.
Booming Indian Beauty And Wellness Market
In the Indian beauty and wellness market in India, beauty ecommerce websites like NewU, Purplle, etc. are leading the space with a focus exclusively on beauty and wellness products.
Recently, reports surfaced that Amazon India is planning to launch its own private label of beauty and personal care products. Prior to this, Myntra announced its plans to open beauty and wellness offline stores.
In a December 2016 report, FICCI estimated the Indian wellness industry to grow with a CAGR of 12% to achieve a $23.4 Bn (INR 1.5 Tn) turnover by 2019-20.
Another report claimed that the Indian beauty industry is looking towards a market value of $12.4 Bn (INR 80,000 Cr) by 2017-2018 and is expected to grow at a rate of 15% to 20%.
Confirming the line of claims, RedSeer Consulting also established a report that suggested that the domestic online beauty and personal care market is expected to cross $3.5 Bn by 2022 from the present figure of $300 Mn.
With a huge addressable market, Nykaa’s focus on O2O model with retail expansion is bound to get a huge push post the Series D funding.