Mamaearth continues to get investor love. After a year of superb growth, with the promise of another strong year, the firm has generated the sort of buzz that every stakeholder that matters likes. Be it consumers, investors and strategic partners.
Stepping up now is Sofina Ventures with fresh equity participation in the Bengaluru-based company. According to regulatory filings, the company has approved the allotment of 902 Series E preference shares at an issue price of Rs 23,43,696 per share to raise Rs 202.4 crore or $27 million from Sofina.
While Mamaearth has already raised Rs 147 crore from Sofina, the remaining Rs 55.2 crore would be invested by the Russian investor in multiple tranches. The new financing appears to be an ongoing one and Mamaearth is likely to raise more capital in this round. According to Entrackr sources, existing investors such as Sequoia, Fireside Ventures and Stellaris with a new investor will also invest in the new round.
For Mamaearth, the fundraise comes even as competitor Sugar Cosmetics raised its own Series C funding led by Elevation recently.
Sofina leading a new round in Mamaearth was first reported by ET in May.
Mamaearth is likely to deploy the funds in expanding its footprint in retail space and acquiring new brands to create a holistic portfolio across beauty and personal care.
The baby and mother care brand had raised Rs 130 crore in its previous round led by Sequoia India and participated in by other existing backers.
Mamaearth’s investor attention has been built around growth at a scorching pace in the past two-three years with sound unit economics. It could be gauged from its 6.5X jump in operating revenue in FY20. According to Fintrackr, its operating revenue jumped to Rs 110 crore in FY20 from only Rs 16.8 crore in FY19. The company’s losses stood at Rs 5.9 crore, a far better outcome than most of the growth-stage consumer internet startups.
Mamaearth’s revenue may cross Rs 500 crore mark in FY21, according to a report by investment bank Jefferies. The report also outlined that close to 35% of the company’s revenue comes from direct channels and 45% from third-party marketplaces such as Amazon and Flipkart. About 20% of sales originate from offline channels.
Mamaearth competes with The Moms Co, Sugar Cosmetic and many other brands in the baby-mother care segment and personal hygiene space.
Mamaearth has been one of the multiple Direct to consumer or D2C brands that investors have taken a shine to. Last month, men focused D2C grooming brand The Man Company had raised around Rs 50 crore primary capital from Emami. The round was exclusively reported by Entrackr on June 22.