Australian clean beauty brand Frank Body has its sights set firmly on conquering the Chinese market after clinching a deal with Shanghai-based private equity firm EverYi Capital, valuing the brand at around $100 million. EverYi Capital will hold a stake in the business and offer on-the-ground support to help the brand expand its footprint in Asia over the next three years. A partnership with Australian retailer Mecca, who recently entered the region through Tmall, will support the move and
and Frank Body will set up a local team in Shanghai.
“Taking a global view is really in our DNA as a brand … on our fourth or fifth day in business, we received an order from Sweden. So, the idea of selling Frank Body internationally was ingrained in us from the very beginning,” Frank Body co-founder and CEO Steve Rowley told Inside FMCG/Retail.
He highlighted the importance of having a local trusted partner on the ground to ensure that the brand is relevant and translated appropriately for the Chinese consumer.
“Chinese consumers are most knowledgeable, particularly in beauty, in the way they’re looking at ingredients, understanding the products that they’re putting on their skin.
“We believe that the ingredients that go onto your skin should be as safe as the ones that you’d be putting in your mouth.”
Rowley expects China will be one of Frank Body’s core markets in the future and that the brand’s core values around ethics, accessibility and affordability will be a hit with Chinese consumers. And now that China has removed a mandatory requirement for animal testing on general imported cosmetics, there is no stopping the brand’s advancement in the region.
“We’re a hard no on animal testing so this shift is welcome to us. I don’t know if anyone saw this coming nine months ago when we started discussions … but we hoped at some point there would be a shift in requirements.”
International growth
Frank Body has been going from strength to strength internationally, with the US now the brand’s biggest market, generating approximately 50 per cent of 2020 fiscal year revenue through direct-to-consumer sales and partnerships with major retailers such as Ulta, Target and Urban Outfitters. A US targeted Series B investment round is in the pipeline later this year.
“We mean something quite different to the US consumer than what we do to the Australian consumer. In the US, we are very strong in body care. It’s quite different here in Australia. Skincare, particularly through our e-commerce channel, is really a key driver of consumer engagement with the brand,” Rowley said.
Earlier this year, Frank also launched into 350 Boots stores in the UK and now has two team members on the ground.
“[In the UK] we’ve been quite strong in the alternative e-commerce players, the likes of Asos, Cult Beauty, The Hub Group, for quite some time. Now partnering with Boots, we’re going through that same journey that we did with Ulta, it’s at least a three-year-journey to really refining [that offer] and sitting comfortably within that retail space.”
The business, which was set up by five friends at a coffee shop back in 2013, will continue to be independently owned and all the co-founders still retain a controlling interest. EverYi Capital managing partner Susan Shui-Shien Lin will join the co-founders and Unilever Ventures on the board, which the brand said will always have a minimum of 50 per cent female representation. Manufacturing and innovation of products will continue from both Australia and the US.
“It’s a really exciting next stage for Frank Body, I feel like the hard work is just beginning as we try to enter this truly magnificent market,” Rowley added.