Mumbai-based online beauty and cosmetics retail platform Purplle has raised $45 million (about 326 crores) in a Series D round from Sequoia Capital India and other existing investors Verlinvest, Blume Ventures, and JSW Ventures. The round saw the company's valuation rose to Rs 2,200 crore. The funds raised will be used to shape Purplle into a multibillion-dollar, digital-first, beauty and personal care enterprise.

Purplee, an e-commerce platform for beauty products in India was founded in 2012. It currently has 70 million monthly users. The startup had secured $30 million in a Series C round led by global investment banking major Goldman Sachs in December 2019.

With this round, Purplle’s existing investor Ivy Capital has partially exited the company with a return that is 22 times more than that of its investment. IvyCap had invested Rs 15 crore via its Fund I in the company in 2015 when the company was valued at Rs 50 crore. It has now sold a part of its stake for Rs 330 crore, making this one of the largest returns ever for a rupee fund.
“We were confident that digital would disrupt and redefine the beauty industry in India. We continue to believe in the growth of the company and thus have retained our stake for Fund 2,” said, Vikram Gupta, Founder &Managing Partner, IvyCap.

This partial exit has made the fund generate 1.35 times its entire fund 1 value of Rs 240 crore, which was raised in 2013 from various domestic financial institutions like large banks, insurance companies, the Small Industries Development Bank of India, and the IIT Alumni Trust. It again raised a fund of Rs 535 crore in 2018 and invested in follow-on rounds in Purplle from its second fund too.

“Domestic institutional investors will have seen these kinds of returns for the first time from Indian VC investment. Domestic investors should get a lot of confidence in investing in this asset class going forward,” Gupta added.

This development comes at a time when beauty e-commerce marketplaces and D2C brands selling on digital platforms have raised funds or are in talks for a larger round in recent months. The list includes MyGlamm, Sugar Cosmetics, and Juicy Chemistry.

Purplle claims to have over 1,000 brands with nearly 50,000 products available on its website and app and more than seven million monthly active users on the beauty marketplace.

Purplle’s growth indicates the growth of the e-commerce space in India, where more users have started to purchase fashion and beauty products online.
"Despite Covid, Purplle delivered remarkable growth. We believed in their mission of democratizing beauty across the heartlands of India, with affordable and accessible products,” said Arjun Anand, executive director at Verlinvest.

“We are seeing a growing trend towards the gentrification of e-commerce in India. Consumers are making a clear distinction between distribution platforms and brands that are more relevant to them. We see Purplle emerging as a dominant beauty destination as penetration of the online beauty market grows from 10% to more than 25% over the next decade,” said Sakshi Chopra, Principal, Sequoia India.