EkAnek, the parent company of beauty ecommerce platform Foxy, has successfully raised INR 21.6 crore ($2.5 million) in a strategic funding round led by existing investor Lightspeed India.
Strategic Funding Details
According to regulatory filings accessed by Inc42, EkAnek issued 31,638 compulsorily convertible preference shares (CCPS) to Lightspeed India at a price of INR 6,827.4 per share, as per a special resolution passed by the company.
Utilization of Capital
The capital infusion will be utilized by the company to accelerate its growth, expand its footprint, and for general corporate purposes.
Shift in Focus
EkAnek’s decision to pivot towards beauty and skincare consultation services was announced by CEO Karthik Sheth in a recent interview with Livemint. This strategic shift is expected to be fueled by a larger funding round, with Lightspeed India, Matrix Partners, and Peak XV reportedly planning to invest $10 million.
Expansion of ESOP Pool
In addition to the funding, EkAnek has expanded its employee stock option plan (ESOP) pool by 7,520 stock options, bringing the total ESOP bank to 29,657 options.
Company Background and Previous Fundraising
Founded in 2018 by Chandranshu Sinha, Kartik Sheth, Nikhil Gilani, and Sachin Singhal, Foxy is an ecommerce platform offering a wide range of beauty, grooming, and cosmetic products. The Delhi NCR-based startup previously raised INR 40 crore in its Series A1 round, with participation from investors such as Alpha Wave, Matrix Partners India, Peak XV, and Lightspeed India. To date, the startup has reportedly raised $21 million.
Financial Performance and Market Dynamics
Despite facing increased competition in the Indian beauty ecommerce space, Foxy reported significant year-on-year growth in operating revenues, reaching INR 36 crore in FY23. However, losses also increased by 8% to INR 28 crore in the fiscal year ending March 2023.
Market Outlook
The Indian beauty ecommerce market is witnessing heightened competition with the entry of conglomerates like Reliance (through Tira) and Tata Group (through Tata Cliq), alongside established players like Nykaa. With the online beauty shopper base projected to reach 122 million and the D2C beauty and personal care market expected to grow to $5.6 billion by 2025, the sector presents both opportunities and challenges for players like Foxy.
