IgniteXL Ventures Closes $10M Fund To Back Diverse Beauty And Wellness Founders
Beauty and wellness-focused venture capital firm IgniteXL Ventures has raised $10 million for a fund backing seed-stage disruptive brands and service providers from diverse founders often underserved by venture capital.
Led by solo general partner Claire Chang, a Silicon Valley veteran and experienced angel investor with deep connections to the K-Beauty segment in her native South Korea, IgniteXL’s portfolio already contains 21 buzzy emerging brands, including gen Z skincare specialist Bubble, sexual wellness company Dame, multipurpose beauty product maker Alleyoop, and editorial destination and affiliated inclusive skincare brand Very Good Light and Good Light. With its $10 million fund, IgniteXL expects to write checks ranging from $100,000 to $250,000 for initial investments in brands and service providers.
Chang has worked with over 200 early-stage startups, but, unlike other beauty and wellness investors, didn’t rise up the ranks in the industry. She views her pedigree as a point of differentiation and an asset for brands. “I’m learning through our founders how the beauty industry works,” says Chang. “What I bring to the table is what I’ve seen in Silicon Valley. I’ve been in this Silicon Valley startup ecosystem for over 20 years, and have seen technology and its application to almost all industries. Technology is now being applied to disrupt this $5 trillion beauty and wellness market, and that’s where we’re excited to be working with founders who recognize this transformation and address the needs of the consumer.”
Chang moved to the United States from Seoul when she was 12 years old and forged a career at international startups through a Korean government-run accelerator before starting her own global accelerator in 2014. In 2018, IgniteXL launched Silicon Valley’s first-ever beauty tech accelerator, SV Beautytech. Chang maintains strong ties to Asia, and those ties are advantageous for IgniteXL’s portfolio brands. The Asia-Pacific (APAC) region is the largest beauty market in the world, accounting for 43% of global cosmetics sales in 2020, according to Statista.
Chang discloses that among IgniteXL’s limited partners or LPs are the cosmetic manufacturers Cosmax and CTK. “They’re both leading the world,” she says. “We leverage that resource, but there’s also the market opportunity expansion of Asia. McKinsey called Asia the future growth engine. If you do not include Asia as part of your global strategy, you are missing out on half of the consumption market.”
Chang is excited to be a woman of color investor in the white male-dominated venture capital world. A study by Women in VC shows that venture capital firm partners are more than 95% male in the U.S. In a beauty and wellness industry in which brand founders and consumers are overwhelmingly female, entrepreneurs find themselves pitching investors with little understanding of their products or the problems they’re trying to solve.
Chang points out women’s health and wellness is an area that’s particularly underserved and has substantial potential for growth, especially in the field IgniteXL specializes in at the intersection of technology, beauty and wellness. “There’s just so much to be unpacked,” she says. “This is happening because there are more female fund managers that are coming into market to back female founders addressing these issues.”
As an example, Chang highlights IgniteXL portfolio brand Dr. Elsa Jungman, a science-driven clean skincare startup that recently launched an at-home skin microbiome test, as capitalizing on the merging of technology with women’s health and wellness. “Elsa’s learning more about how women’s skincare needs vastly change as you are going through the perimenopause and menopause,” says Chang. “There are so many changes that are happening in your body. We’re just in the beginning stage of understanding all this. Even my primary care doctor has very little understanding of what happens in menopause.”
Another portfolio brand, Wild AI, helps female athletes optimize their workout routines based on their menstrual cycles as well as their life stages into post-menopause. “These new incumbents have no qualms talking about their cycles,” says Chang. “There’s nothing that needs to be taboo about this. I think that’s very promising.”
Formed at the start of the pandemic, IgniteXL has attracted a global cadre of prominent venture capital investors and strategic LPs. In addition to Cosmax and CTK, Han Kim of Altos Ventures Management, Perry Ha of Draper Athena and Allen Miner of SunBridge Group are partners in the fund.