Shiseido has invested in Apothékary through its venture capital arm to bring the wellness brand’s pre-series A funding round to $8 million.
Oversubscribed by 40%, according to Shizu Okusa, who was climbing the ladder in the financial industry with stops at World Bank Group and Goldman Sachs before founding cold-pressed beverage company Jrink in 2012 and Apothékary eight years later, angel and existing investors, including Anne Mahlum, founder of fitness concept Solidcore, and VC firm Stella Capital, joined Shiseido in the brand’s round. All told, Apothékary has accumulated slightly over $15 million in equity funding and $6 million in debt funding via Walden Mutual Bank.
Long Term Investments for the Future (LIFT), Shiseido’s VC fund with probiotic acne care brand Phyla and grooming brand Patricks in its portfolio, is backing Apothékary at a critical juncture for the brand, which branched out from direct-to-consumer distribution to enter retail at 400-plus Sprouts doors in September and has now landed on Ulta Beauty’s website, marking its debut in specialty beauty retail. Apothékary is Ulta’s first brand with alcohol alternative products, and it bolsters a wellness assortment that has been a priority for the chain.
Apothékary’s presence at Ulta is a key piece of the brand’s business puzzle as it aims to reach $30 million in sales this year, up 40% from last year, and its capital infusion is supporting its retail and headcount expansion. Apothékary’s team is currently at 60 people. The brand is available on Ulta’s app and its site in The Wellness Shop selection with the $39 beauty and wellness tinctures Blue Burn Metabolic & Weight Support, Take the Edge Off, Rosé-Tinted Glasses, Never Been Bitter, Wine Down and The Honest Youth.
“We’re so excited to bring Apothékary to Ulta Beauty, offering our guests a fresh way to embrace wellness as part of their everyday beauty rituals,” says Lisa Tamburello, VP of merchandising at Ulta, in a statement. “Apothékary’s plant-based tinctures are a unique addition to The Wellness Shop, especially as more of us are looking for natural ways to support balance and beauty from within. We foresee that our guests will love how these products make self-care feel both simple and meaningful.”
Okusa says, “We launched in Sprouts nationwide. That’s a very different kind of retailer to Ulta, but that’s where wellness is. It’s this intersection between supplements and vitamins and beauty. We’re taking a multipronged approach, really going at beauty, grocery and then Amazon. We’re eager to test out Ulta because it feels like a new customer angle because of customers coming in from beauty.”
Although wellness has been a challenging category for beauty retail, Ulta is dedicated to it and has been finding ways to make strides in it. As of December last year, it carried more than 140 wellness brands and 700 wellness stockkeeping units. On top of Apothékary, its wellness brand roster features Love Wellness, Foria, Moon Juice, Lemme, Olly and The Honey Pot Company, a period care and feminine wellness brand that arrived at Ulta in October. Earlier this month, the retailer introduced a fresh in-store wellness concept in about 70 doors showcasing brands like aromatherapy brand Neom and buzzy showerhead brand Jolie.
LIFT’s investment in Apothékary reflects two objectives for Shiseido: increasing its exposure outside of Asia and in wellness. The Japanese beauty conglomerate’s venture investments were previously focused on Asia with a VC fund it established in 2022 called Beauty Innovations Fund. Late last year, Shiseido acquired New York-based Dr. Dennis Gross Skincare as part of its effort to diversify its geography. Apothékary is based in Falls Church, Va., Phyla is based in San Francisco, and Patricks is based in Sydney.
In the initial nine months of this year, Shiseido’s operating profit dropped 26%, and it attributed China’s slowing economy as a big factor in the drop as well as a delayed recovery in its sales in the Americas. For the full year, the company lowered its forecast for operating profit to 35 billion yen or nearly $226 million from 55 billion yen or roughly $356 billion.
As it seeks to right the ship, Shiseido has articulated a vision of becoming a “personal beauty wellness company” by 2030. It’s not alone in investing in wellness through a VC arm to figure out the role it could play in the category. L’Oreal’s VC fund BOLD has invested in supplement and skincare longevity brand Timeline; Natura &Co’s VC fund Fable Investments has invested in sexual wellness brand Maude; and Unilever’s VC fund Unilever Ventures has invested in supplement brands Create Wellness, Nue Co., Perelel and Plant People, among various wellness brands.
Okusa says, “This goes into the conversation of everybody looking at beauty and wellness and those industries starting to really converge.”
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