◎ Company overview
Solidu - solid cosmetics brand
Ethical, innovative & waterless beauty products packaged in 100% backyard compostable boxes.
Female-founded Solidu creates zero-waste products which are environmentally ethical alternatives to everyday bottled lotions, shampoos and shower gels.
The problem
Current cosmetics brands use plastic containers contributing to more than 120 billion units of packaging every year globally that the personal care and beauty industry produces —most of which are not truly recyclable. Each shampoo bottle takes 500 years to biodegrade.
The solution
Ethical, biodegradable solid cosmetics products. They don't use microplastics, silicones or other ingredients that don't readily biodegrade. Zero-waste products integrated into manufacturing process, from the water-free product and biodegradable packaging.
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Each ingredient is carefully selected by scientists on the manufacturing and R&D team (2 FTEs), which focuses premium quality, sustainability, and efficacy first.
- Self-funded and bootstrapped to €1.3m in sales revenue since 2019 (first manufacturing unit was 20sqm)
- Ongoing relationship with major retail partners: Zalando, Eurovaistine, Von Maur & Others
- Impact focussed: 250,000 plastic bottles prevented to going into landfills
- The only EU cosmetic brand with backyard biodegradable packaging
Product line includes:
- natural cold-process soaps
- shower bars
- nourishing body butters
- Solid shampoo & conditioners
- Essential oils/ Drops
The Products
At the core, products are made by eliminating water, resulting in the volume of the product is reduced up to 80%. This means that clients only pay for the concentrated goodness, and it also allows to reduce transportation costs and emissions by up to 75%.
Snapshot
- Currently 48 products (including variants)
- Solid bars only contains active ingredients
- Travel-friendly: no restrictions
- Longer lasting than conventional shampoo (30 to 50 washes)
- No packaging waste, no harmful ingredients, no excessive water
- Not tested on animals
The Packaging
Solidu boasts to be one of the only EU solid cosmetics brands with backyard biodegradable packaging.
Snapshot:
- Packaging is biodegradable after 45 days (household)
- Completely plastic free and paper free
- Produced from starch, bamboo, and charcoal
- Bamboo offcuts from the production of bamboo chopsticks (no virgin bamboo)
- Material is dyed with charcoal without using synthetic dyes.
- Driven founder: started in 20sqm kitchen, done €1.3m in sales since 2018
- Big market: sustainable, ethical beauty set to be is $54.5 billion in 2027
- Solid sales growth: B2B - €400k, B2C - €190k, 180+ B2B clients
- US market growth: signing contract with client that has 43,000 retail locations
- Clear impact: each bar sold = 28.4 g of non-recycled plastic & 239.5 g of water saved
- ◎ Company overview
- 🚀 Current traction
- ♻️ Impact thesis
- 💸 Investment opportunity
- 📊 Financial overview
- 🌍 Market size
- 🏋🏼♀️Risks & Challenges
- 🥷🏽 Competitors
- 💬 Testimonials
- 🧲 Team
🚀 Current traction
Successfully perfected the product with 100,000+ paying customers. Over €1.3m in sales since 2018 (€460k in 2021), which has resulted in 250 000 plastic bottles prevented from ending up in landfills.
Distribution channels built in 24 countries, and a solid cosmetics market leader in Lithuania. Ongoing contracts with major retailers: Eurovaistine, Douglas, Amazon, Zalando, Von Maur, and others. Loyal customer base established on social media, with tens of thousands of followers, decent presence in the US. Solid team of 7 FTEs. Awards at international trade shows.
Sales channels and figures
Wholesale/B2B
B2C
- 182 retail B2B clients (€400,000+ in revenue from B2B sales since Jan 2021)
- 26 active suppliers (€210k+ procured since Jan 2021)
- Active in 25 markets
- Acquisition channels
- Trade shows (2% success)
- Cold Calling (5% success)
- Direct Online Platforms (15-25% success)
- Proactive Outreach (80% success)
Total 🇪🇺 sales (from 2021): €299,016
Total 🇺🇸 sales (from 2021): €116,1312
- Strong relationship with distributor located in Florida (order volume TD: €90,000)
- Luxury Department Store retailer located in Iowa with 35 stores
- 5+ independent retailers in California, Colorado, Missouri, Virginia, Massachusetts, Illinois, Texas
- Warehouse facilities located in North Carolina
- Active marketing agencies to grow both B2B and B2C sales
- Total sales in the US
Start with B2C in Jan 2022 to compliment B2B sales, will total sales of €190,000+ since 2021. Managed to achieve the following results:
Total 🇪🇺 sales (from 2021): €182,468
Total 🇺🇸 sales (from 2021): €6,807
| Name | Amount (2022) | Amount (2021) |
|---|---|---|
2491 | 4683 | |
9023 | 12712 | |
€31318.7 | € 52,495.84 | |
€60284.37 | € 113,392.92 | |
3.6 | 2.7 | |
€24.20 | € 24.21 | |
€12.57 | € 11.21 |
Product & Tech
The type of solid shampoo manufactured by SOLIDU uses the best ingredients and to ensure their efficacy, versus commonly seen “soap” or “melt & pour” solid shampoos. Because this manufacturing process is less common, fewer similar brands are available on the market. Company has spent €30k on manufacturing equipment and current manufacturing capacity is 50,000 bars/month. All manufacturing is done at the lab in Vilnius. There is registered IP on the shape of the mould for bars.
- 250k+ units sold since 2018
- Current product & variations: 35
| Product Group | Qty | Sales with tax | Avg product price |
|---|---|---|---|
1437.00 | €26,855.50 | € 18.69 | |
1908 | €12,616.88 | € 6.61 | |
419.00 | €363.42 | € 0.87 | |
26732 | €181,064.07 | € 6.77 | |
9102.00 | €10,013.56 | € 1.10 | |
1355.00 | €2,955.22 | € 2.18 |
Awards
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Growth indicators
💪🏼 Expand on success in the US to generate annual revenue of $350k in 2023 and $1.3m in 2024 💪🏼 Grow from €450k yearly revenue to €2M yearly revenue within 24 months
💪🏼 "Convert" 400,000 customers to sustainable beauty habits
💪🏼 Prevent 1M plastic bottles from ending up in a landfill 💪🏼 Establish 100 new sales points working with several large retail clients in 2022
With demand of solid cosmetics still growing and few manufacturers working in the field, we are uniquely positioned to develop new sustainable products, new solid cosmetics brands or private label projects.
♻️ Impact thesis
Challenge
Solution
Metrics
💸 Investment opportunity
Solidu is raising a €600,000 for this pre-seed round to expand on existing product line, manufacturing process and geography. They have secured €400,000 from a Hungarian Impact VC and as part of this round €75,000 was secured from angel investors in Jan 2022, which converts on this priced round.
Previous funding:
2018 - founders capital €50,000
2020 - government loan €50,000
2022 - Convertible note €75,000 (will convert on the closing of this current round) from angels (Per Moller (Partner at 70 Ventures), Alex Gibb (partner at Katalista Ventures)).
- Expand retail footprint: Introduce SOLIDU to 500 retail outlets (current 100) within the EU and USA
- Digital Marketing: Increase brand awareness through our webshop and digital marketing. Target ROAS (US only): >2, CRR: 25%, target AOV: €50 (current €25)
- Geography: Focus on expansion and being established in USA, Baltics, CEE.
- Manufacturing: Upgrade manufacturing facilities & reduce manufacturing FTEs salaries by 70% COGS by 30% or manufacturing capacity by 100,000 bars/month
- Increase Revenue: Grow from €450k yearly revenue to €2M yearly revenue within 24 months (global).
Next possible round: Q1 2025
📊 Financial overview
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🌍 Market size
The trend is growing in the cosmetics industry year after year. According to Future Market Insights (FMI), waterless cosmetics sales are set to grow at a 13.3% CAGR between 2021 and 2031. Sustainable, ethical beauty is set to surge: the global market value for natural cosmetics and personal care is projected to increase from US $34.5 billion dollars in 2018 to roughly US $54.5 billion dollars expected for the year 2027
The USA skincare market is the largest in the world, amounting to US $20 billion. The market is expected to grow annually by 4.18% (CAGR 2022-2026).
The market segment is not saturated yet, so there is ample opportunity to be the first of its kind in many retail locations. Consumer awareness about the environmental issues is growing, as is the willingness to choose better solutions, with both millennials and Gen Z expecting a beauty product to offer more than just the traditional functions & benefits.
More than a quarter (28%) of consumers said they’re spending more on environmentally friendly products than ever before. For millennials, the percentage is even higher at 41%. The same goes for consumers with household incomes of $100,000+ (40%)8
TAM = (global cosmetics market) USD 507.8 billion SAM = (global natural cosmetics and personal care market) USD 34.5B
🏋🏼♀️Risks & Challenges
Click on the arrow to expand on the challenge
Prices not able to compete in the market. Currently not able to compete on price, as large players will be able to produce a cheaper product. Therefore, too many competitors arising, and more large companies putting focus on this market segment might create a threat. The strategy is to cultivate brand-loyalty instead of competing on price alone, and to communicate our story and values to stand out in the beauty market. If the market changed drastically and price point became a problem, the plan is to launch more brands that would be cheaper, and could address the market segment that SOLIDU brand is not able to. Current price range is €3.99 - €29.99
Inability to scale manufacturing. With fewer companies doing it, working in a solid cosmetics field has its advantages. However, it also has its own problems, making it more difficult to source equipment. Fortunately, Solidu has partnered with a local maker-space that help us with technological solutions, which can then be taken to larger equipment manufacturers. However, they might face problems with scaling all of the current SKUs - high time and cost needs wouldn’t be viable. To avoid this, they ready to adjust the manufacturing processes or to get rid of less scalable SKUs if necessary.
Raw material shortages. COVID-19 has been a good indicator of how fragile their global supply chains are. Raw material shortages might set SOLIDU back and leave them, unable to fulfill their obligations. Price changes might lead to increased COGS. Losing the key raw materials, like packaging for example, might damage their brand image. To be more resilient, they are always ready to look for creative solutions and can even re-formulate if needed.
Loss of key staff. People is what makes SOLIDU excel as a company and a brand. Loss of the founder or of any key staff members would set the company back, and with difficult hiring climate it might have long-term effect on SOLIDU. The company is dedicated to create a warm, flexible and empathetic work environment, cultivate trust and sense of ownership. To further improve the situation, they will create employee stock options and to make sure that salaries are competitive in the job market of the post-pandemic world.
Need for customer education. Often the first solid product that a customer tries and able to leave a long-lasting impression. However, to get new customers and to convert into loyal fans, more needs to be invested into customer education, as opposed to more conventional beauty products. This might be a hurdle and require more time and investment to acquire new customers. However, as the segment grows, this becomes less of a problem. With more solid and waterless brands, the burden of customer education can be shared, and all can benefit as a result (as well as the oceans and landfills!).
🥷🏽 Competitors
There are 3 two main factors to consider when understanding the competitive landscape for solid cosmetics:
- the industry is still in its infancy as most of the major competitors only started to actively sell solid cosmetics in the last 3-5 years
- being a beauty consumer product, means there is no ‘winner takes all’ mentality. One client can purchase multiple products across a few competitors
- with an increase in the number of solid cosmetics brands, the burden of customer education can be shared.
The table below is a deeper understanding of each competitor (in addition to this there is a 50 brands to watch list that Solidu founders are tracking).
| Name | Logo | Orignated | Geography | Revenue | Price range | SKUs | Distribution |
|---|---|---|---|---|---|---|---|
🇩🇪 | EUUKUSAAustrialia | €7-8 per shampoo bar | 60+ | Offline: 98 physical shops in the UK (Sainsbury's, Ocado, Oliver Bonas and smaller similar shops), Online: eshop, Amazon & Asos, 6 ecomm stores in Lituania | |||
🇬🇧 | EUUKUSA | £100,000 | €11 per shampoo bar | 60+ | Offline: beauty & cosmetics stores, in Lithuania sold at "Pas Giedrę"
Onilne: Own e-shop, other plastic-free/eco-frinedly e-shops (e.g.www.theplasticfreeshop.co.uk), | ||
🇩🇪 | GermanyLithuania | €348,000 | €10 per bar | 20+ | Offline: In Germany, sold at more than 120 physical shops.
Online: radiusdent.lt; eurovaistine.lt; pigu.lt; klipshop.lt; gintarine.lt; livinn.lt; | ||
🇫🇮 | FinlandNetherlandsBelgiumLithuania | €500,000 in 2017 | €15 per bar | 81 | Offline: own physical store in Riihimäki, retail outlets in the beauty, eco, and salon categories throughout Finland and EU
Online: Own e-shop in Finland and Netherlands, | ||
🇧🇷 | BrazilUSA | n/a | $14-15 per bar | 23 | Online: Webshop in Brazil and USA, Amazon | ||
FranceEU | €1.81m | €10 per bar | 100+ | Offline: 3,000 retailers in France
Online: Webshop in French and English | |||
🇬🇧 | 49 countries | $1bn | €10-11 | 100+ | Offline: 951 stores globally
Online: own webshop | ||
🇳🇿 | 16 countries | €30 - 50m | €13-15 per bar | 40+ | Offline: Woolworths Australia (950 stores) 1000+ of stores in 22 countries.
Online: own e-shop, Amazon, Holland & Barrett, Boots
| ||
🇺🇸 | $1.16m | €11-13 per bar | 10 | Offline: Available at 11k stores across USA.
Online: Own e-shop, beauty stores, travel & camping stores |
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💬 Testimonials
🧲 Team
Info about team summary
We have highly qualified, highly motivated key people on the team ready to make a dent in the plastic-filled world of cosmetics. The team is a strong women-led team of 7 FTE’s (1 male) and consultants.
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| Name | Position | Team | FTEs |
|---|---|---|---|
Head of manufacturing and R&D | Leadership | ||
Business Development Lead | Leadership | ||
Founder & Managing DirectorCFOCTO | Leadership | ||
Head of manufacturing and R&DSourcing & Procurement | Manufacturing | ||
Sales Rep | Sales Team | ||
Packing & Fulfilment | Sales Team | ||
Marketing & Social Media | Marketing Team | ||
Head of design | Consultants |
Disclaimer: This memo and all documents presented and attached here is confidential and intended for Fundie Ventures and its affiliates. It is strictly forbidden to share any part of this document with any third party, without a written consent.
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update: 21.10.2022