Shiseido’s investment grew the round to $8 million, exceeding the original target amount by 40%, according to Apothékary. The brand offers functional tinctures and powders made with plant-based ingredients that support skin, digestion, cognition and sleep and energy, in addition to non-alcoholic products.
“This round itself was originally supposed to be a $5 million equity round. We closed about $4.6 million of that in January,” Shizu Okusa, founder, Apothékary, told FoodNavigator-USA.
In total, Apothékary raised more than $15 million in equity funding and $6 million in debt funding from Walden Mutual Bank. This year, the company’s goal is to grow revenue by 40% to reach $30 million.
Apothekary will focus on long-term funding strategies to sustain profitability
Shiseido’s involvement, which began after Apothékary rebranded in January 2023, was a natural fit due to Shiseido’s expertise in the beauty space, and the shared cultural connection with Okusa’s Japanese heritage, Okusa said.
“[Shiseido] continued to impress me with the resources that they have, and the experience and the skills sets, the distribution, the team. And we are at a stage in the business where we are able to be a bit more flexible in the types of capital that we bring in,” beyond venture capital, Okusa said.
Venture capital typically expects very high returns on investment, e.g. 50 times more, within a short time frame, which is not ideal for Apothékary's business, Okusa explained.
Rather, Apothékary is relying on profits from the business and credit lines and leveraging patient capital or family offices that have no immediate need for returns, she added.
Retail expansion highlights the growing functional wellness space
With tinctures that support skin health like The Honest Youth and Rosé-Tinted Glasses, Apothékary's retail partnership with Ulta.com places the brand in front of new customers seeking ingestible ingredients that double as alcohol alternatives, reflecting the growth of the non-alcohol channel post COVID-19 pandemic, Okusa said.
“Apothékary's plant-based tinctures are a unique addition to [Ulta’s] The Wellness Shop, especially as more of us are looking for natural ways to support balance and beauty from within,” said Lisa Tamburello, VP, merchandising at Ulta Beauty.
The partnership with Ulta also inspired Apothékary to explore investors who could bring strategic value in the beauty space, Okusa added.
In October, the company also announced its tinctures will be available in 400 Sprouts Farmers Markets, aligning with the retailer’s growing supplement department in the non-alcoholic space.