Purplle raises $45 Mn from Sequoia and existing backers

Online beauty and cosmetics selling platform Purplle has secured $45 million from Sequoia Capital India, Verlinvest, Blume Ventures, and JSW Ventures in what appears to be a Series D round for the Mumbai-based startup.

Purplle had scored a $30 million Series C round led by global investment banking major Goldman Sachs in December 2019.

In a press statement, Purplle said that its existing investor Ivy Capital has partially exited the company with a 22X return. IvyCap had invested Rs 15 crore via its Fund I in the company in 2015 and then invested in follow-on rounds from Fund II pocketing a total of Rs 330 crore. “We continue to believe in the growth of the company and therefore we have retained our stake for Fund 2,” said a statement from IvyCap.

Purplle claims to have over 1,000 brands with nearly 50,000 products available on its website and app and more than seven million monthly active users on the beauty marketplace.

Purplle competes directly with Nykaa and other horizontal majors such as Amazon and Flipkart. The development comes at a time when beauty e-commerce marketplaces and D2C brands selling on those platforms, have raised funds or are in talks for a larger round in recent months. The list includes MyGlamm, Sugar Cosmetics and Juicy Chemistry. 

Nykaa was reportedly in talks to raise around $50-150 million in a secondary round that will value the Flaguni Nayar-led firm at about $2 billion.

During the fiscal year 2018-19, Purplle was close to hitting profitability. However, the Manish Taneja-led firm’s operating revenue dropped by around 14% to Rs 86.8 crore during FY20 and its annual losses surged by 512.3% to Rs 24.92 crore during FY20 from Rs 4.07 crore in FY19.

During a recent conversation with Entrackr, Taneja said that the company invested in people, technology and the market side in FY20 which leads to an increase in costs. He further added that the firm would keep doing that for the next few years to capture the size of the opportunity.

The company had recently participated in Chennai-based beauty brand Juicy Chemistry’s $6.3 million financing round. According to Entrackr sources, the company would invest and acquire small-scale brands in the beauty space from the fresh fund infusion.