Esqa: Unilever Pumps $4M in Indonesia’s TikTok-Famous Vegan Cosmetics Brand

Indonesian vegan cosmetics label Esqa – a TikTok favourite – has raised $4M in a Series B round led by Unilever.

Unilever Ventures, the VC arm of global FMCG giant Unilever, has led the Series B funding round of Esqa, investing a further $4M into the Indonesian startup.

It follows a $6M Series A round in 2022 – also led by Unilever, with participation from southeast Asian VC firm East Ventures – taking the total raised by the beauty business to $10M.

Based in Jakarta, Esqa is Indonesia’s first vegan cosmetics brand. As reported by DealStreetAsia, the company had announced the investment in a filing with the Singaporean regulator, Accounting and Corporate Regulatory Authority (ACRA).

But since such filings typically reflect the equity secured so far, the Series B round could potentially be a larger sum and contain other components as well, like debt.

Bestie-owned brand leans into highly active TikTok generation

Founded in 2016 by childhood friends Cindy Angelina and Kezia Trihatmanto, Esqa’s portfolio includes make-up products for the face, eyes, cheeks and lips. All offerings are Halal-certified too, catering to the fact that Indonesia is home to the largest Muslim population in the world.

Angelina and Trihatmanto were students at the Pepperdine University in Los Angeles for 10 years, before moving back to Indonesia in 2014 and finding vegan skincare essentially non-existent. The pair aimed to address the quality gap between international and local cosmetics brands, and offer affordable luxury.

“We believe that every woman is naturally beautiful and makeup is not supposed to change your look, but to enhance your natural beauty,” the co-founders say on the company website. “So we develop innovative products that are the cutting edge in the international makeup scene.”

They bootstrapped the startup with $20,000 to launch its first product, becoming profitable within two years. It has since expanded into a business with over 70 employees, more than 30 active products, and present in 47 local cities as well as in Vietnam, Singapore, and Malaysia.

“We managed to double our revenue every year, even during the pandemic when all makeup categories were down,” Angelina, who is the CEO, told Tech in Asia in May 2023.

The company’s true success, though, has come from social media, with about 765,000 followers on Instagram and TikTok combined. “We only started using TikTok in November [2022], explained Angelina. “In Q1 2023, our growth on TikTok has increased 6x.”

Since that interview a year ago, Esqa’s follower count on TikTok has jumped from 175,000 last year to 465,000, tapping into a Gen Z demographic that boasts the highest screen time in Asia-Pacific.T To double down on this growth, Esqa has opened a studio specifically for livestreams on TikTok, going live about six times a day, for up to three hours each time.

Esqa’s retail goals bolstered by Unilever’s latest investment

Esqa also has plans to focus on the brick-and-mortar channel, with plans to open five to 10 stores in big cities where its brand is already established.

“We open our own stores so that customers can have a full experience of the brand. Especially since Indonesian women’s skin is diverse. For makeup shades, they need to try them on in person,” said Angelina.

A 326-person survey last year found that nearly a quarter (74%) of Indonesians would buy cruelty-free personal care products. This was highest among respondents aged 17-25 (75%) and women (77%).

The poll also revealed that cruelty-free purchase intentions decrease with higher incomes – 77% of Indonesians earning Rp1.5M to Rp5.5M ($91.50-$335) a month are willing to buy such personal care products, but this dips to 55% for consumers with a monthly income above Rp10M ($610).

It further highlights Esqa’s focus on affordability and social media. Indonesia has the highest number of TikTok users globally, and estimates suggest that 42% of them are aged between 18 and 24.

This is what would have drawn Unilever too. The CPG behemoth has been under fire for watering down its climate goals amid investor pressure, but has been rolling out innovative packaging solutions across its portfolio of consumer brands.

Investing in Esqa, Indonesia’s foremost vegan cosmetics brand, will enable it to tap into a $19B global market that’s expected to grow by nearly 7% annually until 2032. “Esqa’s ability to innovate an exciting line of products spotting international trends while customizing to local needs has been instrumental to their early success,” Pawan Chaturverdi, a partner at Unilever Ventures, said after the Series A round.

The financing will help advance Unilever Ventures’ responsible partner policy, through which it has committed to invest in companies that “protect and preserve” the planet and “address holistic environmental sustainability, with emphasis on climate, water, waste, biodiversity, no deforestation and plastic”.