New Delhi-based male grooming startup Ustraa has raised INR 16.8 (approx. $2.1 million) in a strategic funding round led by subsidiary Info Edge Startup Investments. IIFL Seed Ventures and Wipro Enterprises also participated in the round.
According to regulatory filings, Info Edge invested INR 7.5 Cr, while IIFL Seed Ventures Fund-II and Wipro Enterprises pumped INR 6.3 Cr and INR 3 Cr, respectively. Ustraa’s parent company, Happily Unmarried, has passed a special resolution to issue 1,960 Series I Preference Shares at an issue price of INR 85,711.84 per share.
Entrackr was the first to report on the development. Ustraa last raised INR 20 Cr in its Series H funding round from IIFL Seed Ventures Fund in February last year.
Founded in 2003 by Rahul Anand and Rajat Tuli, Ustraa is a D2C men’s grooming startup whose portfolio includes shampoo, face wash, hair oil, beard oil and other products. It largely sells its products through its web portal, e-commerce platforms such as Amazon and Flipkart, and third-party retail stores.
According to Crunchbase, the startup has raised $10.8 million in funding so far.
Ustraa reported a revenue of INR 38.73 crore and a loss of INR 22.86 crore in the financial year 2022-21 (FY21). The startup primarily operates in a space where its competitors are consumer goods giants and conglomerates. It competes with Beard owned by Maric, The Man Company backed by Emma, and Bombay Shaving Company backed by Reckitt Benckiser, among others.
The men’s grooming market remains untapped and pales in comparison to the women’s beauty and personal care market. However, sales of these products have skyrocketed over the past few years as attitudes to male grooming change.
Amid growing demand, several new entrants have emerged in the space, gaining support from consumer goods companies looking to diversify their portfolios.
Rajat Tuli, Founder of Ustraa, said, “The male grooming stage is in its nascent stage and traditional players are not innovating. While online is a strong platform, GT (general store) continues to have a strong position, so expansion is key here. The company needs to expand into more channels to protect itself from the risk of channel concentration.”
In July, Ustraa was represented at 9,000 branches in general trade as well as in separate modern business verticals. Tuli also said the startup gets most of its revenue, around 70-72%, from the online channel, and expects the digital mix to come down to 65% in the next few years.
With 120 distributors across India, Ustraa has also recruited around 500-600 beauty consultants to sell the products. Targeting mainly the youth population, Ustraa claims to have a gross margin of over 70% with a net annualized rate (ARR) of INR 1.2 billion. The company aims to achieve an ARR of INR 1.5 billion to INR 1.7 billion by the end of this year.
According to the report, the men’s cosmetics market in India was pegged at INR 140.50 billion at the end of 2018 and is projected to grow to INR 319.82 billion by 2024.