Function of Beauty Raises $150M to Expand Customized Products

Function of Beauty image credit: Isometrics

Function of Beauty is a New York-based company that focuses on creating customized beauty products for the masses. The company raised a $150 million Series B funding round in early December. The Greenwich, Connecticut-based private equity firm L Catterton, which focuses on investing in consumer brands, led the round. Existing investors CircleUp and GGV Capital also participated in this Series B round.

Function of Beauty Founded by MIT Grads

Dossa founded the company with the mission of bringing customized hair, skin, and body care products to a broader audience. Dossa confessed that he actually “passionately hates the beauty industry” and was motivated to transform and disrupt the industry. Prior to founding Function of Beauty, Dossa had success in building another beauty brand, The Argan Tree. The line of argan-infused oils quickly scaled and found its way onto the shelves of grocery stores such as Whole Foods.

How it Works

Function of Beauty EU
Function of Beauty EU

The quiz starts by asking customers about fragrance and color preferences for their haircare products. The quiz then moves into asking about the customer’s goals for formula performance, assessing qualities such as oil control, strengthening, frizz control, split end repair, and scalp soothing. Once you have submitted your quiz, the company determines your unique formulation with the help of its MIT-trained scientists. After Function of Beauty has completed making your customized formula, it will deliver a package to you. The price for a set of a 16-oz. shampoo and 16-oz. conditioner is $49.

Function of Beauty Means Function of YOU

As summarized by Avik Pramanik, a partner at L Catterton, “Function of Beauty has cracked the code of mass customization and is poised to redefine the beauty landscape. We are delighted to partner with Zahir, Joshua, Hien, and the company’s passionate team to grow the brand. Together, we look forward to deploying an even more aggressive growth marketing strategy in domestic and international markets while fostering breakthrough product innovation in hair care, skincare, and more.”

Partnering with a private equity firm like L Catterton, which is particularly active in the consumer space, is a strategic win for Function of Beauty. L Catterton has invested in consumer brands globally, including a number of beauty brands such as The Honest Company, Elemis, Bliss, II Makiage, Frederic Fekkai, Nutrafol, and Tula. Luxury group LVMH Moet Hennessy Louis Vuitton founded the private equity firm in 2016. The company arose from merger between luxury goods leader LVMH and private equity firm Catterton.

Function of Beauty intends to use its newly raised Series B funds to expand product development, manufacturing capabilities, and its international presence. The company currently has a presence in 45 countries and would like to broaden its reach further internationally. Concurrently, it plans to expand its customer base in the U.S. market. In 2017, the company raised a $12 million Series A round that was led by GGV Capital. Since then, it has also secured an undisclosed amount of debt financing that has helped fuel its growth.

Social Media Influencers and Campaigns

As one of the first-movers in the customizable beauty products space along with funding from prominent investors, Function of Beauty’s future outlook looks strong. “In our view, in 10 to 20 years, personalization will be the norm, not just a niche,” says Dossa. “Consumers will expect personalization because we have the technology, capacity, and means to do so. We’ve thrown down quite the gauntlet for all other companies now as they race to catch up.”

Ryan Carpenter serves as Attorney and Managing Director of Carpenter Wellington. Ryan advises clients across a broad set of corporate and commercial matters.

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