Former senior bank manager quit his job at the age of 49 to start a fashion and cosmetics empire Nykaa
India’s richest self-made female billionaire – Falguni Nayar is the founder of Mumbai-based fashion and beauty retailer Nykaa. And Nykaa, the brand name she founded, which now has a market capitalization of $11 billion, is derived from the Sanskrit word “Nayaka,” which means someone in the spotlight.
From a senior manager of a private bank to deciding to quit starting a business at the age of 49
And a year before her 50th birthday, at the age of 49, she quit her job to start a business.
Businesswoman Nayar said: “You have to become the main actor in the movie of your life”. And in 2012, she founded the fashion and beauty business Nykaa. She invested $2 million in the early years of her startup, with her husband, Sanjay Nayar, the Indian CEO of US-based private giant KKR. (She and her husband studied together at the prestigious Indian Institute of Management in Ahmedabad.)
One of her first teachers was billionaire KKR co-founder – Henry Kravis. “He was the first major shareholder to support me, encourage me to start my business,” Nayar said. “Hery wanted to get shares in the first round of funding, but I wanted to keep it for local investors.” Kravis eventually purchased shares from another selling investor, and Kravis’s company Kravis Investment Partners LLC now owns 1.1% of Nykaa.
So far, it’s been a pretty successful startup journey. Nykaa has sold 4,000 brands, from sprays and lotions to dresses. All are available online and distributed in 102 stores in 45 cities in India. The company recorded a profit for the first time in the financial year ending March 2021. Eight months later, Nykaa went public, one of the rare cases of startups turning a profit before an IPO. That helps explain why Nykaa’s November listing was such a huge success: a $13 billion IPO was registered with a valuation in excess of 82 times. Though the stock has tumbled since then, Nayar is still worth about $5.9 billion, thanks to a 53 percent stake she owns with her husband and 31-year-old twins, Anchit and Adwaita. The twins run Nykaa’s fashion and online businesses.
Childhood imbued with “entrepreneurial spirit”, dare to take risks
Nayar grew up in Mumbai. As a young adult, her father moved from Karachi to Mumbai and became a teacher of Sanskrit. He then founded a bearing business. From a young age, she was encouraged to join the business by her father.
“He expected me to roll up my sleeves and get into the business – even if that meant packing large orders,” she recalls: “My father was a very different thinker. Growing up I always felt I could take risks – because I saw him take risks.”
Her father used to challenge her to pick stocks and study the price-to-revenue ratios of listed companies – ever since she was in high school. She then went on to earn an undergraduate degree in commerce from Sydenham College in Mumbai and a postgraduate degree in management from IIM, Ahmedabad.
Her first job at the age of 22 was as a management consultant at the accounting firm AF Ferguson. She then moved to Kotak Investment Banking, where she was in charge of Kotak’s securities operations in the US and UK.
Incubate a start-up career
Nayar’s entrepreneurial aspirations were incubated from 2008 to 2012, when her twin children were studying in US universities at Columbia and Yale. While visiting her son, she became a loyal customer of Sephora, especially because the Sephora staff helped her find products that were right for her instead of trying to get her to buy products that Nayar would never buy. needed.
She feels India needs “a Sephora”. Around this time, she prepared for her entrepreneurial journey. From 2009 to 2011, she considered ideas in the fields of healthcare (managing a nursing home) and hospitality (long-term stay in a luxury home) before focusing on beauty and cosmetics.
But Nayar realized she had to create an online beauty market in India from scratch. Nayar was ready for any challenge despite her lack of experience in beauty, technology or retail. Despite the difficult early years as a startup, Nykaa’s orders eventually picked up. The number is so large that the support department is not strong enough to handle the job. Three chief technology officers quit in the first four years.
The journey to create a billion-dollar business
When Nayar first turned from banking to beauty, she created an online cosmetics business with international brands such as Bobbi Brown and Charlotte Tilbury. Two years later, the first Nykaa store was opened in Delhi.
The following year, she launched local cosmetic brands for highlighters, foundations, nail enamels and the like – contracting manufacturers in India and sometimes pricing Nykaa brands lower than foreign imports.
In 2017, she moved into the apparel industry through the Nykaa Fashion brand. Currently, Nykaa also sells men’s beauty products (such as beard oils and fragrances) and home furniture, and runs a B2B business that sells to retailers.
The businesswoman said: “We are still working with brands to make luxury items more affordable for Indian customers. We want to put choice in the hands of consumers. use.”
During the first nine months of fiscal year 2022, Nykaa recorded nearly one billion visits to beauty and fashion websites and mobile apps – a 78% increase year-over-year. . The platform also processed more than 23 million orders during that period – an 80% increase.
Nayar emphasized, both of the company’s key areas – beauty and fashion – are ready to grow: “Fashion is the key area of the company during the Covid 19 pandemic. When the stores are closed. As the physical store closed, a lot of fashion products in India were sold online. Nykaa profited greatly from online fashion shopping.”
Currently, Nayar is allocating the $721 million raised in the IPO to expand the system of new warehouses and stores.
(According to Forbes)
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