MamaEarth becomes India's newest unicorn startup, raising $1.2 billion in funding.
Honasa Consumer, the parent firm of Mamaearth, a baby and skincare goods company, is the first unicorn of the year 2022. It wants to use the funds to expand into international markets and to pursue its goal of becoming a brand house.
Lalita Singh 
The investment boom that we saw in India has produced more than 40 unicorns and the startup ecosystem raise about $36 billion in 2021 appears to have continued into 2022, as we already have our first unicorn of the year!
Honasa Consumer, the parent company of personal care brands such as Mamaearth and The Derma Co, stated on January 1, 2022, that it had secured $52 million in a round led by Sequoia Capital, boosting its valuation to $1.2 billion
Mamaearth's current funding round featured investments from Ventures SA and Evolvence, following a $50 million funding round headed by Sofina Ventures that saw its valuation rise to $730 million.
Honasa Consumer's Co-Founder and CEO stated that the funds will be used to launch new brands, boost distribution, pursue inorganic expansion, and expand the present portfolio beyond borders.
Although the company stated that this round will also allow employees to sell their matured ESOPs (employee stock option plans), it did not disclose the amount or number of people who would benefit.
Fireside Ventures and Stellaris Venture Partners are some of Honasa Consumer's additional investors.
Mamaearth's Brief History
Mamaearth, founded in 2016 by the husband-and-wife team of Varun and Ghazal Alagh, has quickly become one of India's most popular new-age consumer brands, particularly in the direct-to-consumer (D2C) category. Instead of pursuing the traditional and expensive offline route or employing any other intermediaries, brands in this area sell directly to consumers through their website or via e-commerce platforms.
More than 80 toxin-free, natural items are available from Mamaearth, including bamboo-based baby wipes, facial masks, lotions, and hair care products. Derma Co, Honasa Consumer's second brand, was introduced in late 2019.
2021-22 Highlights: Turning Profitable & Doubling Revenue
Mamaearth's Varun Alagh recently revealed that the company became profitable in the financial year 2021 and intends to double revenue to roughly 960 crores in the current quarter ending March 2022, after nearly quadrupling it in the previous financial year 2020-21 to 480 crore.
The Journey Ahead
He said the company will focus on inorganic expansion, launching additional brands, and double down on distribution to achieve this goal. Mamaearth also intends to use the funds to grow its range of direct-to-consumer personal care brands.
Looking For the Millennial Connect
Varun Alagh, CEO of Mamaearth, also stated that based on the company's size and the success of The Derma Co, he is certain that they have the competence to establish brands with the millennial appeal. Sequoia, Sofina, and Evolvence all have distinct strengths in the US, Europe, and the Gulf Cooperation Council, respectively, thus this will help them expand internationally and learn from others in these regions.
D2C firms typically start by selling their items online, with the help of e-commerce marketplaces like Flipkart, Myntra, and Amazon. Beauty and personal care, food and beverage (F&B), and fashion are the areas that have proven to be the most profitable for D2C firms at the moment.
