Swiftarc Ventures announced its $10 million Swiftarc Beauty Fund to support female founders leading the next wave of beauty and wellness brands.
Swiftarc started in 2019 and this is its fourth fund, Sid Jawahar, founder and managing partner told TechCrunch.
“We are being socially conscious and deliberate in solving the funding issue for female founders and diverse founders,” he said. “We took a hard look around Black Lives Matter and other awakenings and made the decision to be deliberate in trying to right an industry wrong.”
At the same time, Swiftarc itself is matching this by aiming for its firm’s employee base to be 50% diverse by 2022, Jawahar added.
He feels the beauty industry is stuck in time, where 75% to 80% of sales are still made from wholesale. E-commerce and digitally native brands are just the tip of the iceberg, he said. What has changed is the emphasis on inclusive beauty, with buyers of diverse backgrounds becoming majority purchasers. In addition, it is now not just about the brand, but building a community in order to be successful, Jawahar said.
That’s why Swiftarc brought in Fabian Urquijo, president, whose background is in P&G and Revlon, to lead the firm’s beauty efforts.
“While at Revlon, we saw that independent brands that were digitally native could address unmet needs with personalization that the legacy brands can’t address,” Urquijo said. “Most of their growth is driven by that, and they end up being acquired by the big brands and continue to lead that growth.”
The fund will target categories including clean and sustainable beauty, science-backed beauty products, technology-enabled and community-driven beauty and gender-neutral and inclusive brands.
Jawahar anticipates funding five to seven companies so that Swiftarc can provide the right kind of expertise to the companies, but could increase that to 10. The firm already invested in Alleyoop, a makeup and skincare line for busy women.
The fund combines financing with mentorship, peer-to-peer networking opportunities and targeted training facilitated by an all-female Beauty Council that includes industry, investment and beauty startup executives providing unique and relevant perspectives to the women-led startups. The council committed to helping 100 to 200 female founders in their journey from key introductions to foundational expertise.
Swiftarc’s engagement director Leslie Wolfson is building the Beauty Council and said she “wanted to curate a group of strong women with diverse backgrounds, career experiences and willingness to mentor and share their experiences and knowledge with founders.”