Homegrown personal hygiene company Soothe Healthcare had raised $31.5 million last year in its Series C round led by Gulf Islamic Investments, Northern Arc, KKR-backed Incred and A91 Partners. The funding round was one of the biggest ones by any startup in the personal hygiene space and has come on the back of its strong financial performance in FY21.
Despite the pandemic, Soothe’s operating revenue surged 2.4X to Rs 79.04 crore in FY21 from Rs 32.33 crore in the previous fiscal year (FY20), according to its annual financial statement with RoC. The company runs its business with the brand name “Paree” which offers Sanitary pads, hair removal creams and razors. Sales of these products were the only source of operating revenue for the company in the fiscal year ending March 2021.
Soothe also made Rs 27 lakh from other income including interest on deposits and gain from the fluctuation of currency rates which pushed its total revenue to Rs 79.31 crore in FY21.
On the expenses front, cost of materials emerged as the highest cost centre for the company constituting 47% of the overall cost. This cost surged 2.3X to Rs 53.83 crore in FY21 from Rs 23.79 crore in FY20.
Employee benefit expenses turned out to be the second-largest burn for Soothe after cost of materials which soared 71% to Rs 22.41 crore in FY21. It’s worth noting that women make up 65% of the company’s total workforce which is a rare example across the startup ecosystem.
Soothe Healthcare spent Rs 10.51 crore on sales and marketing in FY21 as compared to Rs 15.07 crore in FY20. In September last year, the company also onboarded Actor- Jhanvi Kapoor as their brand ambassador.
The company spent Rs 6.33 crore on rent and utilities which pushed its total costs to Rs 114.23 crore in FY21. Despite the 2.4X growth in scale, Soothe managed to keep a tab on its losses which remained constant at Rs 35 crore in both fiscal years (FY21 & FY22).
As the revenue expands, the company also managed to improve its unit economics. Soothe spent Rs 1.45 to earn a single unit of operating revenue in FY21 as compared to Rs 2.08 in FY20.
Soothe Healthcare is in a very sweet spot as far as market potential and size goes. The mother and child hygiene category has usually seen focus mostly at the premium end, leaving unorganised players to service the rest of the market. For Soothe and other startups that have entered to solve this, the big challenge is affordability, which the company clearly realises, and has planned accordingly.
With hygiene rising in priority for more and more users in its TG, the firm has no shortage of customers if it can deliver the right product at the right price in India, or for that matter, many other countries around the world.