The Indian D2C skincare industry has witnessed remarkable growth over the past decade, transforming into a competitive space where startups and global giants vie for consumer trust and market share. Amid this fierce rivalry, Jaipur-based Minimalist has emerged as a standout player. Founded in 2018 by brothers Rahul and Mohit Yadav, Minimalist is now poised for a potential ₹3,000 crore ($350 million) acquisition by Hindustan Unilever Limited (HUL), marking one of the largest deals in the D2C skincare industry.
This success underscores Minimalist’s mantra of execution, profitability, and consumer trust, which has set it apart in a crowded market. Let’s dive into the details of Minimalist’s incredible journey, its competitive edge, and what this acquisition could mean for the future of D2C skincare.
The Indian D2C Skincare Battleground
India’s D2C skincare industry has been a hotbed of innovation and investment. Between 2013 and 2018, major players like Mamaearth, WOW Skin Science, and The Good Glamm Group raised significant funding to fuel their growth. Here’s a snapshot:
- Mamaearth: Founded in 2016, raised ~$89.4 million.
- WOW Skin Science: Founded in 2014, raised $98 million.
- The Good Glamm Group: Founded in 2015, raised $432 million.
- Plum: Founded in 2013, raised $51.9 million.
While these brands relied heavily on investor backing, Minimalist charted a different course. With just $17 million in funding, the company focused on execution and profitability, proving that success doesn’t always require massive capital.
Minimalist’s Key Milestones
Founding and Early Days
Minimalist began operations in October 2020, carving a niche with its science-backed, transparent skincare formulations. Inspired by brands like The Ordinary, Minimalist positioned itself as a brand that delivers clean, effective, and affordable skincare.
Rapid Growth and Profitability
- Revenue: ₹350 crore annual revenue with 89% YoY growth and a 5-year CAGR of ~187%.
- Profitability: Consistently profitable since its inception, even during the COVID-19 pandemic.
- Consumer Trust: Gained a loyal customer base by focusing on transparency and efficacy.
Leadership and Founders’ Equity
Founded by brothers Rahul and Mohit Yadav, Minimalist reflects their entrepreneurial spirit. The duo has a history of successful ventures, including MangoStreet and Freewill. They retain ~83.7% equity, showcasing their belief in the brand’s vision.
Valuation and Market Position
Minimalist has achieved a 10x revenue multiple, significantly higher than the average D2C industry multiple of 4-6x in India. This valuation highlights the brand’s strong market position and potential for further growth.
Why Minimalist Stands Out
- Execution Over Expansion:
Minimalist prioritized operational efficiency and profitability, focusing on delivering quality products without overextending resources. - Consumer-Centric Approach:
The brand disrupted the skincare market with transparent labeling, clean formulations, and affordability, earning consumer trust in a competitive market. - Innovation in Products:
Minimalist’s product line is backed by extensive research and development, ensuring efficacy and safety. This focus on innovation has helped it stand out in a saturated market.
The Potential HUL Acquisition
If the deal with HUL goes through, it would mark a significant milestone for both Minimalist and the Indian D2C skincare industry. Key implications of the acquisition include:
- Validation of D2C Success: The deal highlights the growing importance of D2C brands in India’s retail landscape.
- Expansion Opportunities: With HUL’s backing, Minimalist could scale its operations globally, leveraging HUL’s vast distribution network.
- Boost for Entrepreneurs: This acquisition serves as an inspiration for Indian entrepreneurs, showcasing the potential of homegrown brands to achieve global recognition.
What This Means for the Industry
Minimalist’s journey underscores the evolving dynamics of India’s skincare industry. It highlights the shift from traditional retail to direct-to-consumer models, driven by digital transformation and changing consumer preferences. The potential acquisition by HUL further validates the strength of D2C brands in capturing market share from established players.
Future Outlook
Minimalist’s rise to prominence is a testament to the power of execution, consumer trust, and innovation. With the backing of HUL, the brand is well-positioned to redefine the skincare industry, both in India and globally.
As the deal progresses, it will be exciting to see how Minimalist continues to innovate and grow in the coming years.
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