Ayurvedic Skincare Brand Sahajan Secures Funding By Showing Solid Fundamentals

After eight years in business, Sahajan has secured institutional capital.

The Ayurvedic skincare brand has raised an undisclosed amount it’s classifying as pre-series A funding from Ridgeline Ventures, Wonderment Ventures, Top Knot Ventures, Celeste Burgoyne, president, Americas and global guest innovation at Lululemon, Yvonne Strahovski, actress and star of “The Handmaid’s Tale,” and Rupi Kaur, The New York Times bestselling author and poet behind the books “Milk and Honey” and “Home Body.”

Sahajan closed its oversubscribed round in four weeks, demonstrating investors’ confidence in the brand’s financial fundamentals and Ayurvedic products, a global market projected by the firm Verified Market Research to accelerate at a compound annual growth rate of nearly 16% to hit $21.2 billion by 2028, and philosophy that marries Ayurveda with clean beauty and clinical validation. Early in clean beauty to embrace clinical studies, it commissioned third-party clinical studies of products such as bestseller Nourish Crème Riche and Radiance Face Serum to measure their results for the skin.

“I can remember doing our first press event in 2015, and editors were like, ‘Could you spell Ayurveda for me? How do you say that?’ And now fast forward in time to where there’s so many brands, there’s Ayurvedic haircare, Ayurvedic skincare and, for the first time, we’re seeing Ayurvedic cosmetics,” says Lisa Mattam, a former pharmaceutical executive and founder of Sahajan. “We’re in this incredible time in the category, and it’s really our time to not only take that pioneering positioning, but continue our leadership position.”

Except for a loan from Business Development Bank of Canada, Toronto-headquartered Sahajan had been self-funded until its pre-series A round, and Mattam strategically didn’t seek institutional capital until Sahajan showed significant traction. The brand has registered a 90% CAGR in e-commerce revenues from 2019 to this year and been cumulatively profitable over the same period. E-commerce contributes around three-quarters of Sahajan’s sales, but it’s entered several notable retail and hospitality partnerships to underscore its market differentiation and boost its audience.

“We created this really, really sticky loyalty within our customer base.”

Sahajan is available at The Detox Market, Credo, Amazon, The Bay, Well.ca, TSC and Beauty Heroes, and recently signed a three-year global deal with JW Marriott to be in 200,000 hotel rooms at Ritz-Carlton, Marriott, St. Regis and W Hotels properties. Its customers are typically women 34 to 55 years old interested in Ayurveda and performance-driven clean products. Mattam is often asked if the brand’s core customers are South Asian, and they’re not. The United States and Canada are Sahajan’s largest markets. It has 13 products priced from $13 to $64 to be situated in the accessible end of the prestige beauty segment.

“It’s one thing to have customers come in, and they’re one-and-dones, but what investors often see as a signal of success is, do you have customers that have made it to three purchases?” says Mattam. “We had 14% of our lifetime net sales value that was actually people who had purchased 10 times or more. So, we created this really, really sticky loyalty within our customer base.”

Sahajan represents the first investment in beauty for Ridgeline, backer of Cotopaxi, Bonafide Provisions, Joyfull Bakery and Force of Nature. “We were incredibly impressed by what Lisa had accomplished, especially with respect to her strong base of repeat customers and maintaining growth with a focus on profitability,” says Ally Disterhoft, VP of the venture capital firm, in a statement. “Consumers are more discerning now than ever before, and by combining attributes like ‘clean’ and ‘highly effective,’ Sahajan has been able to build a high degree of trust amongst its growing customer base.”

Manica Blain, founder of Top Knot Ventures, says, “From an exit perspective, large strategics are increasingly focused on loyalty within a customer base and community, and so I pay a lot of attention to this when I’m conducting due diligence on new investments. I found the Sahajan cohorts to be amongst the strongest I’d ever seen in direct-to-consumer beauty. In particular, and across all cohorts, the average lifetime net sales value per customer was about 2.3X the average net sales order value, which tells me that, on average, all customers come back and repurchase their initial order value about 2.3 times. In fact, over 50% of Sahajan’s repeat customers come back to purchase 3X or more.”

“It’s authentically Ayurvedic, it’s cemented with clinicals and high science, and it delivers.”

While not disclosing the total funding Sahajan raised, Mattam says, “We used to hear a lot of advice on take as much as you can get. I think that’s the wrong approach. I think it’s prudent to take what you need. So, we went out to get a certain number, we got a little bit more, and we were able to extend up to a certain amount, but we were also mindful of dilution.”

Named for the Hindi word for “intuitive,” Sahajan expects to put its funding toward expanding its distribution and assortment, conducting clinical studies and increasing its team. It’s just tapped Albert Chong, former VP of digital at Ilia, to lead its digital efforts. It’s moving from one to two product launches per year to three product launches per year. A big retail partnership is slated to come to fruition in the first quarter of 2024. Sahajan participated in Sephora’s Accelerate mentorship program for emerging brands in 2016 to ready it for the business realities of being in a big retailer.

“We continue to work with Ayurvedic practitioners to make sure that the deep user can look at that and say, ‘This isn’t a marketing thing, this isn’t like they’ve thrown some turmeric into something,’ and they can feel really strong about it. It’s actually that it’s authentically Ayurvedic, it’s cemented with clinicals and high science, and it delivers,” says Mattam. “That’s what’s going to make Sajahan grow quickly, and it’s what gives us a unique space in the market, but I’m not sure that the market was there when we launched.”

With its market primed today, Mattam is starting to think about Sahajan’s reach outside of North America. “What I’m building is a legacy brand. I want this brand to be a brand that people have on their counters across North America and beyond. I see there’s incredible global capacity for our brand. We see organic traffic coming from outside of North America,” she says. “In the short term, even though there’s an exciting international opportunity, I believe focus is really important, and we still have wide capacity to go deeper in North America. So, the next year or two will certainly be focused on North America.”