Darpan Sanghvi, CEO and co-founder of beauty and cosmetic products start-up MyGlamm, was on the verge of signing on dotted lines with his new investor in March last year, when a nationwide lockdown was announced to counter the spread of the coronavirus. The new investor backed out as uncertainty engulfed the economy, and Sanghvi, who was gearing up for next level of growth, was left in a lurch with Rs 100 crore worth inventory and another Rs 100 crore worth inventory order. To add to that, he had 1,000 employees and absolutely no revenue during the months of April-May-June.
Cut to March 2021, his beauty start-up is valued at $100 million, and is richer by Rs 175 crore. It recently closed its Series C funding that was led by Ascent Capital, Amazon and Wipro Consumer. Sanghvi is hoping that his Rs 210-crore company would triple its revenue to Rs 600 crore by December. His ambition is to be the biggest new age beauty and personal care company, a space held only by legacy companies such as HUL, Dabur, ITC and Loreal.
When his investor backed out in March last year, Sanghvi quickly went back to his existing investors and asked them to invest in the business. "We told them with that money we will make bold moves and they luckily agreed," says Sanghvi. To begin with, the cosmetic start-up expanded its portfolio to skincare from make-up. "In February last year when China opened up, its beauty products sales went up by 20 per cent over the previous year. That gave us the cue to take risk and double down both online and offline, and that paid off for us," he further adds.
Through the lockdown, MyGlamm spread its wings to tier 2-3 markets and increased its offline presence from 500 to 10,000 point of sales. It also expanded its distribution team, who reached out not just to modern retail stores but also chemists and other mom and pop retail stores in these markets.
Since there was reverse migration and a lot of people went back to their homes in tier 2-3 towns, it helped MyGlamm increase its sales in these markets. The smaller towns also were more resilient and returned to shopping in physical stores faster. "By the time the festive season began, my distribution was much more than pre-COVID levels. By October, we crossed pre-COVID levels and hit EBITDA profitability."
In August last year, MyGlamm acquired content and influencer marketing platforms POPxo and Plixxo, which increased its digital reach exponentially, claims Sanghvi. POPxo has 88 million female users and Plixxo has 1,50,000 influencers, and the idea is to build a content to commerce platform.
"We are acquiring consumers through content, which is a radical change through how other people do business," explains Priyanka Gill, co-founder, MyGlamm. She says the 88 million POPxo users often read content or watch videos on the platform and the kind of content they are interacting with allows to understand the mind of the users and serve them products as per their needs.
"We are able to make nuanced recommendations so that she is able to engage with us in different ways. This data play makes us unique. We have proven content-commerce works at scale, if we do it right it can be extremely profitable" Gill further explains.
Close to 99 per cent of MyGlamm's sales comes from its own platforms, unlike other new-age FMCG brands which are more dependent on e-commerce marketplaces for their revenue. Sanghvi is particularly proud of this because he believes that it enables the brand to connect more deeply with the consumer.
"We really understand better as we know what she is browsing, what she wants, she even co-creates her products with us. We are able to cross-sell to her much more because she is directly connected with us," he explains. Having said that, going forward, MyGlamm is also looking at getting 10-15 per cent of its revenue from marketplaces. "With Amazon coming onboard as an investor, consumers will definitely see a fair bit of MyGlamm products on Amazon.
The beauty products start-up plans to increase its point of sales from 10,000 to 35,000 by the end of this year. It is also widening its product portfolio by getting into hair care. It also hopes to increase POPxo's user base to 120 million and have at least 5,00,000 influencers on Plixxo by end of 2021.