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Hindustan Unilever Limited (HUL), India’s leading FMCG company, is reportedly in advanced stages of acquiring the Jaipur-based skincare startup Minimalist. The deal, valued at approximately Rs 3,000 crore, underscores the rising prominence of direct-to-consumer (D2C) brands in the Indian market. Minimalist, founded in 2020, has shown remarkable growth in just three years, with its revenue increasing from Rs 184 crore in FY23 to Rs 350 crore in FY24, highlighting robust financial health and profitability. This acquisition signals a transformative moment in India’s skincare and wellness industry, paving the way for expansion in premium and niche segments.

Introduction to Minimalist

Minimalist is a Jaipur-based D2C skincare brand established in 2020 by Mohit Yadav and Rahul Yadav. Often referred to as India’s answer to global brands like The Ordinary, Minimalist is celebrated for its scientifically-driven, ingredient-focused skincare products, including serums, moisturizers, and toners. Operating primarily through e-commerce platforms such as its website, Amazon, Nykaa, and Flipkart, the brand has achieved widespread digital reach.

Revenue Model

Minimalist’s revenue strategy is built on:

• Direct-to-Consumer Sales: Maximizing reach via online platforms.
• Competitive Pricing: Delivering premium-quality products at affordable rates.
• Continuous Innovation: Regularly launching new skincare solutions based on market demand.

Founders’ Vision

Founders Mohit Yadav and Rahul Yadav leveraged their expertise in product development and business strategy to address the Indian market’s demand for clean, transparent, and effective skincare solutions.

The Growth Journey of Minimalist

Financial Highlights

• FY23 Revenue: Rs 184 crore.
• FY24 Revenue: Rs 350 crore (89% growth).
• FY24 Profits: Rs 11 crore, up from Rs 5 crore in FY23.
• Valuation Growth: From Rs 630 crore in 2020 to Rs 3,000 crore in 2024.

Growth Catalysts

1. Profitability Consistency: Sustained profitability over four years.
2. Consumer Trust: Strong brand reputation for transparency and efficacy.
3. Digital Market Leadership: Dominance in the online skincare segment.

HUL Strategic Acquisition

Objectives

1. Strengthen D2C Presence: Capitalize on the booming D2C market.
2. Broaden Product Portfolio: Expand HUL’s premium skincare offerings.
3. Utilize Distribution Channels: Leverage HUL is an extensive retail network to scale Minimalist.

Prior Moves

HUL’s acquisition of a stake in the D2C nutrition brand Oziva demonstrates its commitment to aligning with high-growth digital-first startups.

Industry Insights

India’s D2C Skincare Sector

• Rapidly expanding, driven by digital-savvy consumers.
• Startups like Minimalist are redefining industry benchmarks with innovation and affordability.

Competitive Landscape

Major FMCG players like Marico, ITC, and Dabur are also acquiring digital-first brands, reflecting a larger trend of market consolidation.

Details of the Deal

Minimalist’s meteoric rise in valuation, from Rs 630 crore to Rs 3,000 crore, underscores its appeal in the Indian startup ecosystem. With backing from investors like Peak XV Partners, the brand’s disciplined approach to profitability and innovation sets a high benchmark. If finalized, the deal will rank among the most significant transactions in India’s D2C skincare space.

Lessons for Entrepreneurs

1. Prioritize Profitability: Sustainable growth outperforms hyper-growth.
2. Embrace Digital Platforms: Online channels are key to reaching a tech-savvy audience.
3. Focus on Transparency: Building consumer trust fosters brand loyalty.
4. Invest in Innovation: Staying relevant requires continuous product development.

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