Mama Earth Turns Unicorn, Profits Increase 2X

Mama Earth, founded by Varun and Gazal Alagh, is a D2C (direct-to-consumer) skincare and beauty brand. It has been in the news since the airing of the first season of “Shark Tank India”.

This company turned unicorn in the financial year 2022. This happened after it raised USD 52 mn in a series F funding round. This funding was led by Sequoia Capital.

In terms of numbers, Mama Earth’s annual revenue grew more than two times, from INR 460 crores to INR 943 crores in the last year. The company has profited significantly in the financial year of 2022.

In addition, the company also lowered its expenses by a 48.5% margin, while the expenses for employee benefit increased by 160%.

These benefits include pension funds, salaries, and other welfare privileges.

Advertising holds a major part of the expenses of this company. Mama Earth spends more than 41.5% of the total costs on advertising. This includes websites, ads, campaigns, and social media influencers.

With the increase in profits, the expenses of advertising have also increased significantly. It has gone up almost 2.2 times the original costs. In the financial year 2022 alone, the company spent Rs. 392 crores on advertising.

In the words of co-founder Varun Alagh, the business has turned more profitable in recent times. This is all because of the increase in the percentage of repeat customers. The profits of this startup can also be attributed to the proliferation of various other channels, both online and offline.

The company aims to raise USD 300 mn via an IPO by the end of the financial year 2023.