(From left) The co-founders of Bare Anatomy Vimal Bhola, Sifat Khurana and Rohit Chawla manufacture their customised products in-house at their facility in Gurugram
Image: Amit Verma
Any commercial haircare
and skincare product—even if it caters to a particular type of hair or skin—will always satisfy only a handful of users. This was one of the key takeaways for Rohit Chawla when he quit The Man Company, a men’s grooming product brand, in 2018. Along with Sifat Khurana and Vimal Bhola, he set up Bare Anatomy in 2019. “We realised it’s not about making one or two ingredients the hero and marketing them. With Bare Anatomy, we decided to be more scientific in our approach and cater to each customer’s needs,” he says.
Bare Anatomy has built an algorithm that requires customers to answer a questionnaire about their skin and hair types, stress levels and lifestyles to provide customised hair and skincare products. The company launched its haircare line in 2019, and skincare line in mid-2020. “R&D is at the core of the brand. Each product is formulated individually, depending on the data collected from the questionnaire,” claims Bhola. Unlike a lot of brands that outsource their manufacturing, Bare Anatomy does it in-house at its Gurugram facility.
The startup has raised $1 million from Sauce, the family office of the Patni Group, and other investors. “Since February 2020, we have grown 3.5x in terms of revenue,” says Chawla, despite the lockdowns disrupting the supply chain and manufacturing. Before the pandemic, Bare Anatomy was one of the few startups with an online-only advantage, but now “it’s becoming a lot more competitive since everyone is competing in the same online space”. With a customised product range, scaling up is likely to be a concern. “We have debated if we should launch a mass market product, but it is against the brand’s ethos,” Khurana adds. The startup is likely to touch Rs 1 crore in revenue by the end of January, and has recently launched subscription plans.
The personal care market in India is set to touch $20 billion by 2035, driven by increasing disposable incomes and growing aspirations, according to ASSOCHAM. “In the last few years, the Indian market, similar to other parts of the globe, has been seeing unprecedented growth in customer consciousness towards what they are applying on their skin and hair, and how healthy and sustainable it is,” says Abhishek Goenka, head and CIO, RPSG Ventures, a venture capital (VC) fund. Environmentally sustainable personal care brands in particular are growing in popularity, as are ‘made in India’ brands. These startups have found a sweet spot in terms of pricing, as they are slightly more expensive than commercial brands, but significantly cheaper than luxury Indian brands such as Kama Ayurveda
and Forest Essentials.
Haircare products account for 50 percent of the revenue at Arata, founded by Dhruv Bhasin (left) and Dhruv Madhok in 2018
Image: Amit Verma
Delhi-based Arata was launched with a similar approach, with the idea being hatched by two 29-year-olds, Dhruv Madhok and Dhruv Bhasin, in January 2016. “He was wearing a lot of hair gel, and I asked him if he was worried about greying and hair fall,” Madhok recalls. Bhasin had said he used a homemade organic flaxseed gel, not a commercial one. That is when they realised a lot of men might want safe, natural and effective hair gels, which were clearly missing in the market.
They started the company in 2018, but it was only in January 2019 that they received their first round of funding, from DSG Consumer Partners, Utsav Somani (partner, Angel List India) and Rajan Raghavachari (former personal care R&D director of Unilever). Between October and December 2020, the duo raised $1 million from Nikhil Vora, founder and CEO of Sixth Sense Ventures, a follow-on investment from DSG Consumer Partners, Rohan Vaziralli, as well as a syndicate of angel investors. Haircare products account for 50 percent of revenue, followed by face and skincare; all the products are plant-based and non-toxic.
“In the first year we earned Rs 1 crore; the second year was Rs 4.5 crore, and we’re planning to close this financial year at Rs 10-12 crore, with a target of touching Rs 25 crore in the next financial year,” says Madhok. Since it is an online-only brand, Bhasin says, “Marketing is a form of digital rent that we have to pay, and it accounts for a chunk of our monthly expenses—about 50 to 60 percent.” They are also planning to launch a line of vegan oral care products.
mCaffeine, founded by Tarun Sharma, has 20 products across body, face and haircareImage: Edric George for Forbes India
While Arata focusses on a niche audience, mCaffeine focusses on a niche ingredient: Caffeine. At 27, Tarun Sharma met with a minor accident that caused his left eye to swell up. When medication didn’t help, he took a friend’s advice of putting a green-tea bag dipped in lukewarm water on his eye. “This was probably the most bizarre advice I ever got,” he recalls, but it worked.
Sharma started reading up on the benefits of caffeine, and realised that most global brands use it in their skincare products. “We spoke to about 100 manufacturers, producers and distributors of caffeine ingredients,” says Sharma, 32, who was working with food delivery platform Box8 earlier. In October 2016, mCaffeine was launched online, with only a couple of products. Since then the company claims to have served 2.5 million customers, and has crossed Rs 100 crore in revenue. “We only have 20 products across body, face and haircare, with face care accounting for the lion’s share of revenue,” he adds.
Though the lockdown months were a bumpy ride, mCaffeine has grown 3x from pre-Covid-19 times. Pre-Covid, about 51 percent of sales was in metros, while 49 percent was in tier 2 and 3 cities. During the pandemic, this trend seems to have been reversed. “An average order value from tier 2 and 3 cities is 20 percent higher than metros, which means the market has depth and we are trying to find relevant customers in this space,” says Sharma. The company raised $2 million (about Rs 15 crore) in March 2019, and another Rs 42 crore last September in series B funding, led by Amicus Capital, RPSG Ventures and Telama Investments.
Influencer marketing has been key to the brand’s success. “We’ve optimised a lot of our marketing efforts by involving influencers,” adds Sharma, who recently launched a coffee-flavoured bathing bar shaped like a coffee bean.
Abhishek Kumar and Rhea Shukla launched a line of body scrubs under the brand The Switch Fix
The Switch Fix is another ‘millennial’ brand, launched in January 2019 by Abhishek Kumar and Rhea Shukla; it has launched a line of body scrubs in collaboration with coffee brand Blue Tokai. “The scrubs are made using repurposed coffee waste that is being sourced from Blue Tokai,” says Shukla, who wanted to switch to a sustainable lifestyle, but didn’t find many options.
During the pandemic, the Delhi-based brand raised an undisclosed sum of seed funding from angel investors Ajay Yadav, founder and CEO of Roomi, and Balvinder Shukla, vice chancellor of Amity University. The founders hope to expand their product range to include an overnight face butter, body butter, facial oils, body massage oils and more, all of which are environmentally sustainable.
“We are available offline in select boutique stores that are centred around sustainable lifestyles. For instance, in Go Native in Bengaluru, I Say Organic in Delhi and The Project Cafe in Ahmedabad. We have nine to 10 such associations across cities,” says Kumar. Among online platforms too, the brand prefers boutique stores such as Tata Cliq, Sublime Life and Brown Living. “We have been approached by the likes of Amazon and Nykaa, but the major barrier has been the plastic packaging. However, we are actively working with the teams to come up with a solution,” says Shukla. Currently the company caters to most of the metros, and the brand has also been doing well in tier 2 cities like Pune, Guwahati and Ahmedabad.
Plum, launched by by Shankar Prasad in 2014 with just one product, now has a product line of over 80 items and raised a series B funding of Rs 110 crore last November
Inspired by global beauty brands, Shankar Prasad, who was a consultant at McKinsey, decided to set up a sustainable brand, Plum; it was launched in 2014 with only one product, a moisturiser. Now, the brand has over 80 products across haircare, skincare, body and make-up, and a men’s personal grooming line called Phy.
“The domination of legacy brands back then was pretty strong and online was not as big as it is today,” says Prasad. But due to rising consumer awareness, and a variety of distribution channels, “a lot more brands are now able to access the market”.
Plum started selling via its own website, and then moved to mainstream players like Amazon and Nykaa. In 2017, it started selling from retail outlets and currently has a presence in over 200 cities. “But even now, retail accounts for only one-third of our total sales,” says Prasad. Plum has been growing 2.5x year-on-year, and is on track to touch an annual run rate of Rs 200 crore by March 2021. Skincare accounts for 60 to 70 percent of revenues, while Phy, haircare and body care account for 10 percent each.
With several brands entering this space, Prasad believes, “The primary task is not to win market share, but to grow the market.” Last November, Plum raised a series B funding of Rs 110 crore, led by Faering Capital and with existing investor Unilever Ventures also participating. It is gearing up to launch more skincare products in the coming months.
Pritesh and Megha Asher, co-founders of Juicy Chemistry, are looking at clocking in a turnover of Rs30 crore by the end of this financial year
Juicy Chemistry was launched in 2015 with the idea of creating a line of organic personal care products. With the aim to educate consumers about the chemicals commonly used in so-called organic products, Pritesh Asher, who was running his family business of manufacturing petrochemicals, and his wife Megha would make chemical-free hair oils, soaps and scrubs in their kitchen and sell them at trade shows. “Offline was the main market back then, and we didn’t have our own website either. So we were taking orders on Facebook or Whatsapp,” says Pritesh. Juicy Chemistry procures ingredients from 20 different countries, and “we try to offer our customers problem-solution driven products that are completely organic,” Pritesh adds.
From a revenue of Rs 2 crore in 2017, the company is likely to clock in a turnover of Rs 30 crore by the end of this financial year, with sales going up 8x as compared to pre-Covid-19 numbers. Face and haircare products account for about 80 percent of revenue. In August 2019, the Coimbatore-based startup got $650,000 from angel investor Amit Nanavati, and just when things started taking off the pandemic hit. “It was an extremely tough time for us; we had just hired more staff, invested in social media advertising and facility expansion. And that’s when sales hit rock bottom,” he recalls. Plans to open a second store in Chennai also got stalled. “Interestingly, 85 percent of our revenue came from offline channels and it continues to be a massive market. Eventually, we hope to have 10 to 12 exclusive stores across the country.
”The brand is already present in Australia, the US and France, and is planning to launch products in the UAE and the GCC markets soon. It is also planning to launch a brand of sunscreens and oral care products.According to Goenka of RPSG ventures, India’s beauty market is large enough to accommodate both incumbents and challengers. He says, “Challenger brands, especially startups, are a lot leaner and nimbler, and focussed on differentiated products and heightened customer engagement. Due to these factors, they have been able to carve a niche for themselves in the market and grown a lot faster than the traditionally leading FMCG companies.”
Check out our Festive offers upto Rs.1000/- off website prices on subscriptions + Gift card worth Rs 500/- from Eatbetterco.com. Click here to know more.