Inside a Singapore beauty brand’s $100m glow up

Over the last five years, Emily Hamilton worked 50 to 60 hours per week running her skincare and haircare brand Coco & Eve.

But in July, the Singapore-based founder sold a majority stake in the company to US-based private equity firm Gauge Capital.

Coco & Eve founder Emily Hamilton / Photo credit: Coco & Eve

The “mostly cash deal,” of over US$100 million, is currently one of the largest beauty industry acquisitions to emerge from Singapore.

Hamilton, who has been an entrepreneur for over 17 years, says she accepted the offer because it was a “big exit opportunity” and something that she “wanted to experience and achieve.”

Founded in 2018, Coco & Eve leverages the online platform to discover customers, connect with them, and build a strong community. In addition, it boasts a significant offline presence in retail stores like Cult Beauty in the UK, Zalando in Germany, Sephora in Asia, and Adore Beauty in Australia. The company’s vegan, clean, and cruelty-free skin and hair care products have made it one of the rare bootstrapped and profitable firms in the industry.

See also: How serial founder bootstrapped beauty brand Coco & Eve to profitability, strong growth

But why did she sell a majority stake in the firm when the brand had been net profitable since 2020 and was on track to report US$60 million in net revenue by the end of 2024?

While Coco & Eve was bootstrapped, the startup hit a snag around the five-year mark and needed an investor that could provide a strategic guidance for its next phase of expansion.

“When you’re an entrepreneur, the first five years are the most fun, and then [come the] bigger problems,” says Hamilton, who will continue to head Coco & Eve after the acquisition.

As funding for expansion grew challenging, the company slashed costs across the business to address rising operational expenses over the years. The firm, which sources its cruelty-free ingredients from Bali in Indonesia, also faced supply chain shortages.

“When you scale a business while bootstrapping, there is no margin for error – you reinvest your profits into growth and scaling the business,” Hamilton says.

Gauge Capital’s established roster of beauty and personal care brands, better economies of scale, as well as a reduced workload for the founder made the deal a compelling one for Hamilton.

Teaming up to trim costs

The highly competitive beauty and personal care market in Southeast Asia is growing at an annual rate of 3.3% and is expected to surpass US$34 billion in revenue by the end of 2024.

Complement or competition?

Steering the ship, for now