South Asian beauty startups are hoarding venture capital dollars - New Style Motorsport

  • Several startups are drawing inspiration from South Asian beauty traditions.
  • Some brands focus on “inclusive” beauty, which venture capitalists say is a fast-growing sector.
  • Others focus on skin care and wellness, areas that have seen a surge in investment during the pandemic.

From saffron facial serums for firming and brightening to turmeric teas for hair growth, a growing number of beauty startups are taking inspiration from the Indian subcontinent.

Some are bringing the principles of Ayurveda, an ancient system of holistic medicine that is traditional in India, to Western consumers.

These startups advertise themselves as wellness brands, introducing American customers to beauty rituals that South Asian women have been practicing for centuries. Others are launching cosmetic lines that address common concerns of women with darker skin tones that have long been ignored by major beauty brands.

The inclusive beauty space is a fast-growing sector, according to Daphne Che, director of Montage Ventures. Her firm is a lead investor in Live Tinted, a cosmetics brand founded in South Asia that raised $3 million in funding in 2021. Other investors in the brand include Halogen Capital and Curate Capital.

Aavrani, a pioneer in luxury Ayurvedic skincare that launched in 2018, has raised nearly $10 million in two rounds from firms including Amplifyher and The MBA Fund, according to Crunchbase.

Over the past year, venture capital investment in beauty and wellness companies has increased significantly. Between 2016 and 2020, the average amount of funds raised by individual businesses in this space was around $1 million. By 2021, that number jumped to $3.2 million, according to Crunchbase.

Some of the biggest beauty news of the past year came from companies based in India. MyGlamm, a Mumbai-based direct-to-consumer beauty startup, rose to unicorn status at a $1.2 billion valuation.

Nykaa, a fashion and beauty e-commerce firm, earned nearly $13 billion in its debut on India’s National Stock Exchange and launched its founder, Falguni Nayar, to the status of India’s richest self-made billionaire. India.

Many new beauty startups operate as direct-to-consumer businesses, or DTCs, meaning they sell their products directly to consumers without the help of retail middlemen. The recent surge in investment in these companies can be attributed to the broader success of DTC frontrunners like Dollar Shave Club, Warby Parker, and Casper. Not that all successful DTC brands are completely foolproof. Glossier, the “cool-girl” beauty brand that rocketed to massive success in 2019, laid off 80 employees in January.

Still, several new Ayurvedic skin and hair care companies have sprung up in the wake of Aavrani’s success, including Soma Ayurvedic, Fable & Mane, and Prakti Beauty, which was founded by model Pritika Swarup.

fashion business predicts that by 2026 the global market for Ayurvedic products will triple its growth since 2017 and reach a total value of $14.9 billion. Established beauty houses have also jumped on the trend. Estée Lauder recently invested in New Delhi-based luxury skincare brand Forest Essentials.

Deepica Mutyala, the founder of Live Tinted, often weaves her own experiences as a girl of South Asian descent growing up in Texas into the company’s campaigns. She said that she would dye her hair blonde to meet Western beauty standards, but that she still fights prejudice against darker skin within the American Indian community.

Mutyala found herself at odds with Indian and Western ideals of beauty. His star product, the Huestick, is born from that struggle. Che calls Mutyala an “outsider in the industry but a connoisseur of the problem” and said that was one of the many reasons his company was drawn to Mutyala’s vision.

Harvard Business School graduate Priyanka Ganjoo launched Kulfi Beauty in 2020 with similar personal momentum. Ganjoo, like many women of South Asian descent, has dark circles under her eyes, so she would wear colorful makeup to distract from them. Her line of vibrant eyeliners is based on that childhood practice. Ganjoo says that she would consider venture capital funding if she found the right partner, but she would have to be someone who aligns with Kulfi’s goal of building an inclusive global brand.

“Before I started Kulfi, I was running into brands that were tokenizing and appropriating South Asian culture,” said Ganjoo.

“Finally, I decided it was time for a founder from South Asia to reclaim our narrative and represent our community through our products, our storytelling, and our actions.”

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