5 Insights on alternative funding for beauty startups

12-Apr-2021 - Last updated on 28-Sep-2021 at 14:29 GMT

ATHR Beauty, the brand Tiila Abbitt is leading to “disrupt the $500 billion beauty industry with clean and sustainable makeup that works,” is in the midst of a funding raise; but it’s not the usual sort.

There are new funding options for beauty startups, options that allow consumers (rather than only accredited investors) to support the brands and businesses they believe in.

Brands like O’o Hawaii are seeking investment on Mainvest. And as Cosmetics Design reported last month, PROVEN Skincare is participating in a livestreaming series called Going Public to secure investment dollars.

And ATHR Beauty is seeking alternative funding too. Through the end of the month, ATHR Beauty is on a private investing platform called Republic, which describes itself as a place “where both accredited and non-accredited investors meet entrepreneurs and access high-growth potential deals across a range of private markets.”

ATHR Beauty seen as a high-growth opportunity by funding platform

Data that Tiila Abbitt, Founder, CEO, and Creative Director of ATHR Beauty, has shared with Cosmetics Design highlights the brand’s potential:

$2M+ in net sales since launch, expected to grow to +$10M by 2023
Sold 80K units since launching the brand in 2018, 225k by the end of 2021
DTC is up 168% for 2020, is over 35% of our sales, 34% repeat client rate
Available at Sephora, Credo Beauty, Neiman Marcus, Douglas, Free People
Highest rated clean makeup with 2,000+ 5-star reviews across all retailers
Winner of over 9 awards including Allure's Best of Beauty 2020

And ATHR Beauty has raised over $150,000 to date on Republic.

When, why, and how indie beauty brands seek funding

In her 5 Insights video for Cosmetics Design, Abbitt explains why the timing was right to raise funds, highlighting the brand’s direct-to-consumer growth in 2020 and a recent brand refresh.

And she’s quite candid about why conventional venture capital didn’t suit her brand, saying, “I’ve yet to meet a VC that really understands impact investing.” Abbitt’s brand is built on the concept of clean and sustainable color cosmetics; and she points out that this has meant “I’ve held back on releasing products because there wasn’t a sustainable option for packaging,” –a strategy she believes the VC world doesn’t appreciate.

By contrast, she says, Republic “opens up the door to my clients, who’ve been there since day one, and I wouldn’t be here without them. So, it really felt right…to give this opportunity to my clients, because if I win, they win.” Watch the full 5 Insights video at the top of the page to hear Tiila’s advice for other beauty brand founders seeking funding and more about the decisions that led ATHR Beauty to Republic. And find out even more about the current ATHR Beauty raise here on the brand’s blog.