When Mamaearth finally goes public next month, its founders Varun and Ghazal Alagh won’t be the only ones laughingall the way to the bank — its early investors will be celebrating too.
Mamaearth’s early backers will make 10-100x on their initial investments in the company. Mamaearth is slated to go public on 10th November at a price of around Rs. 320 a share. VC firms including Fireside Ventures Fund, Bollywood actor Shilpa Shetty and Snapdeal founders Kunal Bahl and Rohit Bansal will make sizable returns when the company goes public.
Snapdeal founders Kunal Bahl and Rohit Bansal had been one of the earliest backers of Mamaearth. They had each invested Rs. 76 lakhs into the company at a price of Rs. 3.21 a share. When Mamaearth goes public at a share price of around Rs. 320, the duo will make a 100x return on their original investment, and net around Rs. 76 crore each.
Another big winner from the Mamaearth IPO would be Marico Chairman Harsh Mariwala. Mariwala had invested Rs. 5.51 crore into Mamaearth at an average share price of Rs. 6.05 per share. When Mamaearth goes public at Rs. 320 per share, he would make an estimated Rs. 290 crore.
Bollywood actor Shilpa Shetty was yet another investor in Mamaearth. She’d come in a little late, with an average share price of Rs. 41 per share. But she’d taken a sizable bet, investing Rs. 6.79 crore into the company. When Mamaearth goes public, she’ll end up netting Rs. 53 crore.
Among VCs that had invested in Mamaearth, Stellaris Venture Partners and Fireside Ventures fund, which had come in at around Rs. 7.5 each per share, will make a 50x return on their investments. Sofina will nearly triple its investment of Rs. 331 crore, while Evolvence will double its initial investment.
These are all impressive returns, but still nothing compared to what founders Varun and Ghazal Alagh will make. The duo hold 37% stake in Mamaearth, and when the company goes public at a valuation of around Rs. 10,000 crore, they’ll end up being worth nearly Rs. 3,700 crore.
This would an incredible journey for Mamaearth, which was founded only in 2016. Beauty and cosmetics is a heavily contested space in India with giants like P&G and Unilever in the fray, but in seven years, Varun and Ghazal Alagh have managed to create a popular brand, managed to rope in big investors and celebrities, become a unicorn, made their products available at offline stores, and are now slated to go public. There might still be a long road ahead for the company — Mamaearth is yet to consistently make money, and had reported a loss of Rs. 151 crore last year — but its founders have already managed to create a massive windfall for themselves and their backers.