Chinese A-Listed Beauty Companies Focuses on Investment Companies
- Chaileedo Press
- May 27, 2022
- 3 min read
Global hyaluronic acid giant Bloomage Biotech participated in the establishment of an investment fund for targeting investments in the fields of dermatology and life sciences. As CHAILEEDO observed, multiple Chinese listed beauty company has established their own investment companies.
Recently, global hyaluronic acid giant Bloomage Biotech participated in the establishment of an investment fund, Hainan Haixi Private Equity Investment Fund Partnership (Limited Partnership), which is jointly held by Hangzhou Paideia Capital and Shanghai Yisheng Company. The total fundraising size of the fund is about $18.31 million, of which Bloomage Biotech intends to contribute $6 million, the first phase using its own funds to contribute $3 million, the proportion of the contribution is about 32.44% if the subsequent contribution will also use the company's own funds.
As CHAILEEDO observed, previously, international beauty giant L'Oreal set up its first investment company in China, dedicated to investing in innovative beauty technology. Soon after, Shiseido also set up its first special investment fund in China, with an investment amount of about $74.5 million.
Back in April, Bloomage Biotech released a statement saying it intended to set up a private equity fund with affiliated party Shanghai Yisheng Company and other partners, with a total fundraising scale of $18.4 million.
According to the announcement, the fund will be directed to invest in the field of skin science and life science, and upstream scientific research, the transformation of scientific and technological achievements, related science popularization, professional content operation, etc. after its establishment. It is worth mentioning that this is also the first private equity fund Bloomage Biotech has participated in setting up since its A-share listing.
LAF, a Chinese daily chemical and cosmetics group, announced that the equity investment fund in which the company participated has completed the filing procedures of the private investment fund in China Securities Investment Fund Association and obtained the Certificate of Filing of Private Investment Fund. Among them, LAF contributed $1.2 million, with a shareholding ratio of 43.96%.
On March 13, 2017, LAF went on the A-share market, known as the "first private daily chemical stock in non-public enterprises", which is mainly engaged in the research and development, production and sales of toiletries, skin care and color cosmetics products.
In addition, Chinese cosmetic company Proya announced in May 2020 that "the company's participation in the investment fund has completed the filing of private investment funds". This also means that the paid-up capital has been entered into the fund escrow account or fund property account, and can make equity investments.
At the same time, Proya also mentioned in its 2019 annual report, that in 2020, "internal entrepreneurship and external incubation platform" will be one of Proya's focuses, that is, to incubate new brands, new categories, and improve operational efficiency and reduce management costs. At the 2020 Tmall Leading Cosmetics Award, Proya also announced that it would establish an incubation base with the Chinese e-commerce platform Tmall to help small and medium-sized beauty companies.
In addition to the above three beauty companies establishing investment fund companies, multiple Chinese listed beauty companies participate in the establishment of a total of more than 10 funds, with a total scale of more than $220 million. From the investment situation, in addition to Bloomage Biotech and BTN, other companies such as Proya, Marubi and Lily&Beauty participated in no less than five projects. Especially LAF has invested in 24 projects before and after, spending $34.3 million. Marubi Company has also invested in 11 projects.
Among them, in the Marubi Company, S'Young, Proya, LAF's investment targets, basically have an MCN agency.
Some data show that live e-commerce has reached trillions yuan, and the scale of live e-commerce will exceed $730 billion in 2023. Obviously, beauty listed companies do not want to miss the windfall of short videos and live with e-commerce.
Beauty companies pay attention to digitalization, and the transformation of enterprises will play a great help. LAF achieved a small rise in both supermarket and distribution channels last year, with its online channel revenue of $50 million, an increase of 51.06%. The same goes for Marubi, which saw an 11.99% decline in offline, but an 8.17% increase in online
International beauty giants have also gained profit in online sales. According to Brazil beauty giant Natura&Co's Q1 2022 results, the Group's online sales, including online sales (e-commerce + social sales) and sales from the Group's main digital apps, accounted for 50.8% of total revenues, compared to 47.7% in Q1 2021 and 35.0% before the pandemic (Q1 2020), driven by the growth of its brands Natura and Avon.
In this phenomenon, Lily&Beauty stated that the establishment of the fund is conducive to the company's continued deep development around its own main business, but also through the investment so that the company can connect to related industries with good development prospects. Proya, on the other hand, mentioned that seeking development opportunities in areas such as cosmetics and new marketing ecology, it will enrich the company's external growth channels and innovative exploration, and systematically enhance the company's competitive advantages.
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