Mamaearth makes public debut, youngest Indian unicorn to list

Anton Ioffe - November 7th 2023 - 6 minutes read

In this revealing narrative, we delve into the captivating journey of Mamaearth, from being a refreshingly novel startup invested in safe, chemical-free baby products, to becoming the youngest Indian unicorn making a splash in the public market. Through countless battles against market competition, regulatory entanglements, and initial funding travails, this story celebrates Mamaearth's phenomenal rise to unicorn status, its meticulous preparation for IPO, and its eventual public listing. Read on to follow their journey through the labyrinth of a successful initial public offering, and explore the realities of navigating the dynamic and ruthless post-listing marketplace. This intriguing saga of audacity, resilience, and innovation is a must-read for anyone in the vicinity of startup culture and enterprise growth.

The Inception and Initial Hurdles of Mamaearth

The Inception and Initial Hurdles of Mamaearth

In 2015, the inception of Mamaearth was not in boardrooms, but in the cozy realms of parenthood. Varun and Ghazal Alagh were on a quest for safe, toxin-free baby products, a need intensified by the ecstatic chaos of new parenthood. Personal struggle gave birth to entrepreneurial ambition, and in 2016, Mamaearth arrived on the scene, emanating hopeful vibes of solving an ignored problem. Intent on creating products that they would be comfortable using on their own child, their USP was unambiguous: toxin-free baby care items that assure parents peace of mind. The challenge, however, was not understanding the demand; rather, it was getting manufacturers on board. Initial propositions were met with skepticism. Despite investing 90 lakhs of their funds and grappling with countless rejections, they anchored their resolve, and after what must have felt like a perpetual quest, finally launched six products. Within six months, Mamaearth experienced an astounding revenue spike of 30 lakhs.

However, the uphill journey was far from over. Breaking into an industry with powerhouses like Dabur, Unilever, and P&G was no easy feat. Made more potent by India’s gigantic offline retail ecosystem and their considerable distribution muscle, these major players posed significant barriers to Mamaearth’s entry. To add to their challenges, Mamaearth's early desire to primarily represent the online market magnified the issue further. Finally, the struggle to secure initial funding compounded the challenge of maintaining their steady trajectory.

While the initial roadblock provided a formidable initial hurdle, the strategic decision to position themselves as a direct-to-customer personal care enterprise powered their growth. Backed by investors like Sequoia Capital India, Sofina Ventures, and Evolvence, they expanded their product arsenal to 80 items across the personal care spectrum. This adaptability underlined their resilience, helping them etch their brand in the often volatile world of start-ups, despite being perceived as a fledgling entity posed against industry giants. The journey of Mamaearth, from the drawing boards to capturing Rs. 10,000 crore category in the personal care segment, is indeed a reflection of strategic planning, perseverance, and a relentless commitment to their core vision and values.

From Start-up to Unicorn: Mamaearth's Funding Saga and IPO Preparations

From a humbling start in 2016, Mamaearth had a dramatic journey punctuated with key funding rounds that set the trajectory of their growth. The brand started as a baby care product line and gradually expanded into a complete personal care brand. The major breakthrough came in 2021 when Mamaearth raised around $80 million at a startling valuation of $1.01 billion, vaulting it into the prestigious unicorn club. This funding round saw active participation from notable investors such as Sequoia, Sofina, and Evolvence Fund.

Transitioning from a rapidly growing start-up to a unicorn was not an overnight event for Mamaearth. The brand demonstrated a strong financial fortitude, recording an impressive fall from a net loss of INR 1,332.2 Cr in FY21 to a substantial net profit of INR 19.8 Cr in FY22. It was this robust financial performance that propelled Mamaearth to consider public listing as the next strategic move to fuel further growth. However, with a careful reading of the market pulse and strategic foresight, Mamaearth took the unusual step of adjusting its IPO value from an initial colossal ₹25,000 Cr down to ₹10,500 Cr.

As Mamaearth continuously prepared for its IPO scheduled on October 31, 2023, they meticulously aligned their actions with an eye on the future. The brand planned for strategic international expansion into markets like Bangladesh, Malaysia, Vietnam, and Thailand, eyeing the IPO funds to resource the expedition. Moreover, by adjusting its IPO value, Mamaearth showcased their financial prudence and steadfast commitment to steady growth, thereby appealing to a wider demographic of potential investors and grounding its financial status to market reality.

The Culmination: Mamaearth's IPO and Its Orchestration

Mamaearth's much-anticipated IPO is the culmination of a journey marked by strategic decision-making, prudent planning, and financial acumen. In an unusual move, the company decided to lower its IPO value from a towering ₹25,000 Cr to a more realistic ₹10,500 Cr. This decision, taken in light of the financial health and market conditions, effectively positioned them for a stable market debut. Despite boasting a robust revenue of ₹1,500 Cr in FY23, they reported a loss of ₹151 Cr, necessitating the alignment of market expectations with their financial status.

Taking the slower startup funding and dip in IPO activities between 2022 and 2023 into consideration, they decided to revise their IPO value. This strategic move was meant to appeal to a diverse cohort of investors, assuaging market concerns and setting the stage for their IPO. Further, their lowered IPO value showcased a clear message of trust and transparency to their potential investors. It symbolizes their commitment to solid, steady growth rather than quick wins, thus fortifying long-term relationships with investors.

Finally, the trimmed down IPO value also ties into Mamaearth's international expansion plans. The unicorn has set ambitious goals to establish presence in Bangladesh, Malaysia, Vietnam, and Thailand. A successful IPO is the vehicle they plan to use for raising the much-needed expansion funds. In conclusion, the orchestration of the initial public offering underlines their well-defined growth plans, and the careful pruning of their IPO value points towards a strategic understanding of the existing market conditions and investment landscape. The overall approach demonstrates a brand deeply rooted in reality and poised for sustained growth.

Post-listing Reality Check: Unpacking the Aftermath

In the aftermath of its public debut, Mamaearth's performance illustrates a challenging, yet promising trajectory. The company's stock showed signs of volatility in the initial trading days, mirroring the volatile conditions of the stock market. This could partly be due to their revised IPO value, which possibly led to investors reassessing their strategy towards the startup. Notably, large new-age technology companies like Nykaa, Zomato and Paytm, which went public around the same time, also exhibited a similar trend in their stock performance. Post-listing, a significant section of the market desired to understand whether Mamaearth's conservative valuation strategy would pay off in the longer run.

Post-IPO, no major disruptions in the company structure have been reported. Instead, Mamaearth remains steady in its roadmap for strategic expansion into international markets. The fund raised from the public offering is believed to partly finance their establishment in markets of Bangladesh, Malaysia, Vietnam, and Thailand. Their decision to revise down the IPO value seems to still echo in their strategic calls, with the focus remaining on sustainable and measured growth, rather than a forceful capture of the market.

Moreover, the adjusted IPO value had an unintended positive outcome -- it managed to paint Mamaearth as a brand that is transparent, grounded, and committed to long-term growth. This could help in attracting a wider and more stable investor base that shares the same philosophy as the company. Ultimately, the full impact of Mamaearth's IPO and the investor sentiment around it will be better gauged in the upcoming fiscal quarters. These quarters will provide a more extended timeframe to observe Mamaearth's ability to convert its strategic plans to action, the market's reaction to these movements, and how this unfolds for the young unicorn's growth story.


Mamaearth, a startup focused on safe and chemical-free baby products, has made its public debut and become the youngest Indian unicorn to list. The article explores Mamaearth's journey from its early struggles to secure manufacturers and funding, to its eventual success and preparation for an initial public offering (IPO). Despite facing challenges from industry giants, Mamaearth's adaptability and perseverance have propelled its growth, leading to impressive financial performance and a valuation of over $1 billion. The article also highlights Mamaearth's strategic decision to adjust its IPO value and its plans for international expansion. Following its IPO, Mamaearth's stock showed initial volatility, but the brand's commitment to sustainable growth and transparency has earned it the trust of investors. The true impact of Mamaearth's IPO and its growth trajectory will be revealed over the coming fiscal quarters.

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