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Exclusive: Syona Cosmetics raises fresh funding from The Chennai Angels

21 June, 2016

Syona Cosmetics Pvt. Ltd, a Chennai-based company that offers beauty products and training services to salons and spas, has raised its second round of angel funding from existing investors.

The company secured nearly Rs 1 crore ($150,000) from The Chennai Angels, according to VCCEdge, the data research platform of VCCircle, based on the company’s filings with the Registrar of Companies.

The Chennai Angels picked up a 17.97% stake in the transaction, taking its holding in the company to 35.95%. The angel network had initially invested in the company last year.

VCCEdge data show the company allotted 3,928 shares at Rs 2,545.82 each to the investors in the latest transaction. This is the same price at which Syona raised an equal amount last year, according to VCCEdge.

Queries emailed to spokespersons for Syona Cosmetics and The Chennai Angels didn’t elicit any response over the development.

Syona Cosmetics was founded in 2012 by Raja Varatharaju and Anuradha Balasubramanian. Prior to founding Syona, Varatharaju worked with companies such as Henkel, Ford and CavinKare while Anuradha worked with HeyMath, Vodafone and CavinKare.

Syona provides products and services under the brands X-proC, Intenso, Lumiance and Klarissa, and has a presence in most leading salons and spa chains in Chennai. It sells its products mostly through modern retail stores. The company is also looking at overseas expansion, according to its website.

Update

The company said in a statement on Wednesday it has raised the second tranche of angel funding from The Chennai Angels. It didn’t disclose the amount.

Varatharaju said in the statement that this second tranche has come at a time when the company is “growing aggressively” and looking to hire top-level sales staff. “We will be intensifying our coverage in South India with these funds,” he said.

He also said that the company is ready to enter the hair and body categories in salon products. “We are also preparing to go beyond salons and launch our beauty products in the retail market,” he added.

Cosmetics market

Syona is among a handful of Indian cosmetics companies to have raised external funding. Vini Cosmetics Pvt Ltd has received funding from Sequoia Capital while Mountain Valley Springs India Pvt Ltd, which sells products under the Forest Essentials brand, is backed by Estee Lauder Companies Inc.

These makers of beauty and personal care products operate in a segment that Euromonitor estimates grew 13.6% in 2015 to Rs 74,700 crore ($11 billion). This segment accounts for roughly 22% of India’s total fast moving consumer goods (FMCG) market, according to a report by consulting firm KPMG and the Federation of Indian Chambers of Commerce and Industry. Of late, some companies have focused more natural or herbal cosmetics. These include yoga guru Baba Ramdev-backed Patanjali Ayurved as well as consumer goods firms such as Hindustan Unilever Ltd, Dabur India Ltd, Emami Ltd and Marico Ltd.

The Chennai Angels was founded in November 2007 and provides finance to early-stage technology-based companies in India. It has invested in nearly 40 startups since inception. Its portfolio includes companies such as Silvan Innovation, Finance Buddha, Cloudcherry, Brigge and ProKlean.

Angel investing kicked off in India in mid-2000 with the formation of networks such as the Indian Angel Network. It has now spread across the country with several affluent individuals showing the risk appetite for investing in startups and as newer platforms such as Lead Angels and LetsVenture emerged.

Early-stage funding in the beginning of 2016 showed an uptick, indicating that the angel and seed-stage investors had kept the initial cheques coming for startups. Based on the deal activity in the first quarter of 2016, VCCEdge’s Startup India report estimated in late April that close to 1,000 Indian startups may get funded in 2016.

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Exclusive: Syona Cosmetics raises fresh funding from The Chennai Angels

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