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Beauty Pie Lands $100 Million Series B

September 10, 2021 BeautyMatter
September 10, 2021
Beauty Pie

Beauty Pie, the luxury beauty buying club founded by serial entrepreneur Marcia Kilgore, has raised $100 million in fresh funding.

WHO: Founded in 2016 by serial entrepreneur and beauty-industry expert Marcia Kilgore, Beauty Pie operates a direct-to-consumer membership model that provides customers access to world-class quality health and beauty products at unbeatable prices by removing the middleman and the traditional 10x markup. The company offers an assortment of some 300 to 400 SKUs with two tiers of pricing—one for those not in the club, and one for those who are paying a premium to be in the club. Consumers in the UK or US can join the buying club either for a month (£10/$15) or a year (£59/$59).

WHY: The fresh capital will support the company as it accelerates plans for warehouse openings, physical retail experiments, and new category launches.

IN THEIR OWN WORDS: "I don't believe in business models where you spend tons on marketing," Marcia Kilgore said in an interview. "So we want to focus the funding on opening new warehouses, moving into new territories and maybe some pop-ups. We are Sephora meets Costco."

"While we weren't necessarily thinking, 'Oh, we should go raise money right now,' because we still had quite a lot of our Series A money left in the bank, we realized that being able to take in a big new investment would help us step on the gas. If we want to expand, that inventory has to be sitting in the warehouses," she said.

"Beauty Pie delivers huge value to its customers, demonstrated by exceptional member loyalty over many years. It's a model that marries industry disruption with customer obsession—a winning combination," said Danny Rimer, partner at Index Ventures.

"Marcia has spent decades building businesses that genuinely treat customers the way she would want to be treated, and Beauty Pie is the epitome of that ethos. With its transformative value chain and membership model, [it] lets members have their pie and eat it too: the best products at the best prices," noted Rebecca Liu, principal at Insight Partners.

DETAILS:

  • Beauty Pie closed a $100 million Series B round of funding co-led by Index Ventures and Insight Partners with the participation of previous backers Balderton Capital, General Catalyst, and Latitude VC.
  • The company did not disclose its valuation, but TechCrunch reported estimates on PitchBook of $1.33 billion are not accurate and said close sources say the valuation is less than $1 billion currently.
  • The Series B round brings Beauty Pie's total funding to date to $170 million.
  • Marcia Kilgore is also the founder behind FitFlop, Soap, and Glory, Soaper Duper, and Bliss Spa.
  • Kilgore claims that Beauty Pie's customer retention rates are currently higher than Spotify's and Netflix's, and 20x higher than other D2C beauty companies partially due to the buyers' club model.
  • Last year members more than doubled, revenue grew by more than 100%, and the company became profitable.
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