Purplle gives 22x returns to VC IvyCap, gets investments from Sequoia Capital

Manish Taneja is the CEO and co-founder of Purplle

IvyCap Ventures, an early backer of beauty and makeup startup Purplle, has made returns of 22 times on its investment by selling a part of its stake to Sequoia Capital and Verlinvest- a single investment, which recoups IvyCap’s entire first fund of Rs 240 crore.

IvyCap invested Rs 15 crore in Purplle for a 30 percent stake in 2015. It sold a part of its shares in this round for Rs 330 crore, when Sequoia and Verlinvest invested $45 million in Purplle, valuing Purplle at Rs 2,200 crore (about $300 million), it said in a statement.

“Purplle has been on a robust growth trajectory. Even with a Covid year, we have delivered >90 percent GMV (Gross Merchandise Value) CAGR (compounded annually) for the last 3 years. This, while scaling our private brands successfully; Good Vibes is already a Rs 150 crore brand. The investment will help to shape Purplle into a multibillion-dollar, digital-first, beauty and personal care enterprise,” said Manish Taneja, co-founder and CEO - Purplle, in a statement.

In an interview with Moneycontrol in November 2020, Taneja said that Purplle can be a Rs 3,000 crore brand, and launching multiple categories and a loyal customer base beyond the metros has helped growth.

“We have invested in Purplle.com from our Fund 1 and Fund 2. When we first invested in Purplle in 2015, we were confident that digital would disrupt and redefine the beauty industry in India. With an initial investment of Rs 15 crore from our Fund 1 growing by manifolds to Rs 330 crore, our partnership has been rewarding," said Vikram Gupta, founder and managing partner at IvyCap.

"We continue to believe in the growth of the company and therefore we have retained our stake for Fund 2. Our belief in the brand and the vision of its founders ‘Beauty for All’, enabled us to generate 1.35x of our entire Fund 1 from Purplle.”

“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," said Sakshi Chopra, Principal - Sequoia India.

"We are excited to partner with Purplle as we believe they have cracked the beauty playbook of value retailing with 3 key tenets – a business built on high retention and low customer acquisition cost (CAC), a wide assortment of brands offering quality at best prices, and an attractive private label portfolio mix. We see Purplle emerging as a dominant beauty destination as the online beauty penetration grows over 10-25 percent over the next decade.”