There’s no shortage of ideas being backed when it comes to direct-to-consumer e-commerce companies that are cultivating their own brands. We’ve seen everything from slippers to toothbrushes to, perhaps most famously, razor blades.
Among the newer frontiers being funded right now: ingredient-conscious perfumes. The New York-based, venture-backed cosmetics company Glossier began marketing a proprietary perfume called You last October that’s designed to change in character on the skin over time, for example. (“You” complete the product, it says.)
Late last year, an L.A. based called Skylar that uses only natural ingredients raised also attracted venture funding: $3 million from Upfront Ventures and serial entrepreneur Brian Lee, who also founded The Honest Company. (Skylar’s founder previously worked at Honest.)
Now another new entrant, Austin, Tex.-based Phlur, appears to be shaking the trees for venture capital. The company — which was launched publicly less than two years ago by Eric Korman, a former president of global e-commerce for Ralph Lauren — is targeting up to $8 million in venture funding, according to an SEC filing that shows it has raised at least $2.4 million toward that end, including from the local firm Next Coast Ventures.
The money follows $6 million that Phlur has already raised, including from Next Coast, for what it describes as scents for both men and women that are made with “responsibly sourced” ingredients. Its packaging is also environmentally friendly, it says; it’s made with 20 percent recycled glass.
We reached out to Korman yesterday to learn more and we’ll update this post if we hear back. But certainly, it’s easy to understand the appeal of companies that promise shoppers they needn’t visit a fragrance counter ever again.
It’s easy to appreciate investor enthusiasm for perfumes. Three giants — L’Oréal Groupe, Coty, and Estée Lauder — still make up the bulk of fragrance sales, and millennials are looking for new options that don’t necessarily remind them of their parents. There’s been a spate of M&A in the beauty sector — and not yet in the fragrance sector, meaning there’s still opportunity there. Not last, the beauty industry is a very big business, with one estimate projecting the global fragrance market alone will be worth about $92 billion by 2024.
These new brands are simply playing into a years-long trend of consumers caring much more about everything that touches them, from their food to their house-cleaning products. As startups provide them with more transparency into how fragrances are made — and sell their products at a fraction of what bigger companies have traditionally charged by navigating around retail stores — we can probably expect to see many more next-gen fragrances, too.
