L’Oréal, one of the largest cosmetic brands in the world, says it is investing an undisclosed amount in consumer focussed venture capital firm DSG Consumer Partners.
L’Oréal said that the investment in DSG’s fourth fund would be strategic in nature and that it would invest in beauty and personal care startups across India and Southeast Asia. The VC firm’s fourth fund will reportedly be around $125 million in size.
DSG has invested in companies such as Indian tea and cafe chain startup Chai Point, dairy firm Epigamia, and juice maker Raw Pressery, among others.
The investment was made through L’Oréal’s corporate venture capital fund, BOLD. The fund had earlier invested in Fireside Ventures, another consumer-focussed investment fund from India, which has invested in Mamaearth, Boat and Slurrp Farm, among others.
“The Southeast Asia and India region have many of the fastest growing, most populous and young demographic markets of the world,” said Vismay Sharma, president of L’oreal South Asia Pacific, Middle East and North Africa “The future of consumer brands will largely be shaped in these markets, so it’s important to build a strong connection to its dynamic ecosystem of disruptors and invest in promising consumer brand startups.”
“We are excited to welcome L’Oréal as an investor in our ecosystem, and partner in our mission to invigorate the region’s industry disruptors and most promising startups,” said Deepak Shahdadpuri, managing director (Singapore), DSG Consumer Partners. “Through this fund, we aim to catalyse emerging market consumer innovation by working with entrepreneurs addressing new consumer aspirations and needs.”
The development comes at a time when internet-first beauty and personal care brands such as Mamaearth, Sugar and Nykaa have seen significant growth over the past few years. ET reported on August 16, 2022 that the beauty and personal care category is driving ecommerce consumption in India, with 143% growth in volume year-on-year, citing a report by Unicommerce.
“Many digital-first brands have emerged over the last two years in the beauty and personal care segment, which provides tough competition to traditional players,” the report said. “Interest from investors and the rising number of ‘House of Brands’ further support growth in the segment.”