Ex-banker gets her turn as billionaire startup CEO via IPO
MUMBAI: For years, Falguni Nayar guided the founders of Indian companies through roadshows in Europe and the US as they made their way to stock market debuts. Now the former investment banker is steering her own startup to an historic initial public offering (IPO).
Nykaa, her brainchild, has grown into India’s top e-commerce site for beauty products, with the endorsement of Bollywood stars and a fervent following among twenty-somethings. The startup, formally known as FSN E-Commerce Ventures Ltd., filed preliminary documents late Monday for an IPO, which Bloomberg News has reported could value the business at more than $4 billion.
One idea Nayar picked up from her time working with entrepreneurs was the importance of a motivating business mission. With Nykaa, she saw the opportunity to help India’s women look after themselves, moving away from the country’s traditional deference to men.
“I was inspired by those diehard founders,” Nayar said in a recent interview over Zoom from her home in Alibaug. “Our message to women has been that the spotlight of her life should be on herself. You are important in your story and should feel no guilt at being center stage.”
The message resonated. Founded in 2012, the Mumbaiheadquartered startup now offers more than 2,500 brands of everything from mascara and makeup remover to velvety kohl
Indian eyeliner and the body tattoo art called mehendi. Through its websites, apps and 70-plus brick-and-mortar stores, the company hit revenue of ₹2,450 crore in revenue and other income in the fiscal year ended in March, according to its filing. That figure rose by more than 35% during that period, despite pandemic-mandated store closures and delivery challenges. The startup is profitable.
If the IPO goes as planned, Nykaa will be India’s first women-led unicorn to go public. Nayar owns about half of the company with her husband and their twin children, meaning the value of their stake could exceed $2 billion if the startup reaches or surpasses initial projections.
“It was a niche waiting to be tapped and Falguni’s dived right in,” said Arvind Singhal, chairman of Technopak Advisors Pvt., a leading consulting firm. “India’s young population has rising aspirations and women across social strata are more empowered with every passing generation.”
Nayar founded the company nine years ago, figuring if she was going to start a business it had to be before she turned 50. “The point of no return,” she said.
The name she picked is derived from the ancient Sanskrit word for heroine.
Nayar had seen that in the West entire floors of high-end department stores were dedicated to cosmetics and other beauty products. But millions of Indian women still had to visit dingy neighbourhood “bangle” or “variety” stores for their beauty needs. These mom & pop shops, mostly staffed by male owners, stocked cosmetics and fashion jewelry alongside craft kits and other knickknacks. Choices were limited, displays poor, and there was no chance to sample products.