falguni nayar: Nykaa would have grown faster in early days with a tech-savvy cofounder, says CEO Falguni Nayar

Bangalore: According to its founder Falguni Nair, Nykaa may have benefited from being a tech-savvy cofounder in its early days.

“If I were to start again I would definitely have a technical person as cofounder,” she said. “It would have saved me a lot of early-stage trouble and certainly would have allowed for better acceleration in the early years.” Nair, who took Nykaa public in November 2021, admitted that the company was a late bloomer on the tech front.

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She was speaking to Deep Kalra, Founder and Executive Chairman, MakeMyTrip India at Tycon Delhi-NCR’s Unstoppable India, a virtual two-day conference for business leaders and entrepreneurs.

Even though e-commerce companies create multiple platforms to cater to different groups of customers, Nair said that his company does not see much difference in consumption patterns between users in metro cities and rest of India.

“I personally feel that consumption in metros and Tier-I is influenced by the level of income. Tier-1 cities are made up of multiple sectors with high income and low income,” she said. “To my surprise, the purchasing power in many small towns in India is very diverse. Small towns have all levels of income.”

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She said pockets of prosperity are everywhere and customer knowledge is more uniform. “There is a very high risk for global events (for people in Tier-II and Tier-III cities),” Nair said.

“You take any phenomenon – clean beauty or natural beauty for example. None of them is just an urban phenomenon. You get acceptance across the country,” she said.

Nykaa had a blockbuster IPO in November, which raised over Rs 5,000 crore, but its stock fell amid a wide rout of technology firms globally. Nykaa, which started at a share price of Rs 2,205, declined to Rs 1,291 by the end of February, before rising again above Rs 1,500 in early March.

Nair said that Covid-19 posed the biggest threat to Nayaka’s business and they had to make some difficult decisions to stabilize the ship. “We were looking at a loss of Rs 42 crore in April (2020), when Nykaa did not face a loss of more than Rs 25 crore in a full year,” she said. “We have reduced our marketing costs. tax, which comprises 5.6% of our revenue, by half.”

In the third quarter of FY22, Nykaa’s revenue grew 36% to Rs 1,098 crore, while its profit fell 59% to Rs 28 crore.

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