• Sandip Nair

Startup Story: Beardo

Beardo, an Ahmedabad-based startup company took off on a successful acquisition journey that every founder dreams of.

An idea starts with a passion and to convert the passion into a professional journey requires dedication, perseverance, hard work, patience, and luck. There are ideas that fade out before coming to paper, a startup journey started but stalled before realization, great ideas received successful investment but couldn't turn into profit, or companies like Beardo achieve success against all odds with the right investments to a profitable business and get acquired by a bigger company to move ahead for a dream of market dominance and also to become a valuable brand.

By the end of June'20, when the whole world was fighting against coronavirus, FMCG Major Marico completed the 100% acquisition of Beardo to include it under its umbrella of brands such as Parachute, Safolla, Set Wet, Revive, etc. The company has a global presence in Asia and Africa.

What will be the future of Beardo? Whats the Big Picture behind this aquisition? Is it a good news for startup ecosystem?

Before we look deep into everything let's first understand the startup.

Beardo a Startup

Beardo a brand was started by two friends Priyank Shah and Ashutosh Valani under Zed Lifestyle Pvt. Ltd in 2016, both MBA graduates after gaining experience in their e-commerce startup "Aajkiitem". The idea for "aajkiitem.com" was conceived and the domain got registered by 2010, to set an e-commerce platform as an alternative to Amazon and Flipkart. Naturally, both of them have gained the required experience in vendor sourcing which was key for the development of Beardo. With the initial market survey, they geared up to get contract manufacturers from Punjab, Ahmedabad, Delhi, and Kanpur as soon as they developed their product range for the brand.

The time was when there were few players with less awareness, Beardo focused on men grooming where the beard grooming got the attention of young consumers who were extremely conscious of their beard and overall looks. The estimated market potential of men's grooming products in 2016 was estimated to be Rs 3,200 crores, as per the BCG analysis report.

With offline retail options through distributorship (Spas and saloons) and online, through Amazon, Flipkart, Snapdeal, and others, utilizing social media marketing, the sales increased time to time with GMV of more than 3crores, in 2016 to Rs 48.2 crore in FY19 to Rs 78.5 crore during FY20, with the financial support from different venture capitalists.

Graph Source: entrackr.com

Beardo’s regulatory filings show that Venture Catalyst (VCat) had invested close to Rs 2.5 crore in the company and held a 1.63% stake before the acquisition whereas Snapdeal’s founders Kunal Bahl and Rohit Kumar Bansal had invested Rs 50 lakh.

In 2020, looking into the increase in the market potential to Rs 10,000 crores in men's grooming and the performance of Beardo, Marico acquired the rest 55% stake in the parent company of Beardo which in 2017 had invested by acquiring a 45% stake to venture into this segment. It has been confirmed that the investors have exited the company successfully making it a wholly subsidiary of Marico.

As of December 2020, the following are a few of its products of Beardo:

The other competing brands in line up with Beardo are, The Man Company, Bombay Shaving, Ustraa, Soulflower, etc, which have not reached similar operating revenue.

Looking into the benefits which both Beardo as a brand and Marico as a company could gain is that, Marico need not invest in R&D and nor invest in building up a brand from the ground up. Whereas, Beardo has now the opportunity to tap more consumers through the distribution channel of Marico. The success journey of Beardo is an inspiration to the startup ecosystem. We would wait and look into who could followup the path of Beardo soon.

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