Gobi Partners leads $2m Series A in Malaysian cosmetics e-commerce platform Hermo

Malaysia's leading cosmetic e-commerce platform Hermo.

Shanghai-based venture capital firm Gobi Partners has led a Series A investment of $2 million into Malaysian cosmetics and skincare e-commerce platform, Hermo.

In a statement, Gobi Partners said that this round of financing will be primarily used to strengthen Hermo’s product base, bring on new team members, enhance marketing efforts, and establish regional offices outside of Malaysia to drive market expansion and supplier relations.

“Hermo will focus on building its presence in the Indonesian market and continue to drive operations momentum in Singapore. The company plans to work closely with suppliers to directly source products,” the statement read.

“This will allow Hermo to guarantee supplies, improve margins, and ultimately provide better products, discounts and deals for consumers. Leveraging the company’s three years of operations, Hermo will also utilise big data to better work with brands and improve product offerings,” it said.

Prior to this round of financing, Hermo received angel and seed investments from Singapore-based Crystal Horse Investments and local Malaysian angel investor Tan Swee Yeong. The amount raised in these fundings totalled MRY450,000 ($100,000).

Hermo has over 3,000 active stock keeping units at the moment, with over 150,000 monthly active users;

From October 2014 to September 2015, Hermo’s revenue reached MYR10 million –  a three-fold year-on-year growth.

The e-commerce business was set up in February 2012, co-founded by Ian Chua, PS Chong and Ian Mok. Chua and Chong had recognized similar models in China such as VIPShop and Jumei, and believed that Southeast Asia was ripe for a homegrown premium cross-border cosmetics platform.

Hermo is a leading platform within its vertical, ranked on Alexa as the top beauty e-commerce site in Malaysia.

The e-commerce business targets premium-grade cosmetics products, offering competitive prices and focus on after-sales services. Currently, it has direct relationships with major international brands, including partnership with L’Oreal.

It noted that Korean brands are most popular among users, though the reception towards Japanese, Taiwanese and Chinese brands is also strong.

Its user base is currently 95 per cent female, and nearly 50 per cent of orders are completed on mobile.

“As Malaysia’s leading beauty vertical, we are excited to bring on Gobi Partners as our investor. Moving forward, we will expand regionally to meet the needs of more women in Southeast Asia. We believe that Hermo will be able to help more brands reach consumers as mobile technology gains momentum in the region, filling gaps between supply and demand in this market,” said Chua, who is also chief executive officer of Hermo.

Partner at Gobi Partners, Kay-Mok Ku said Hermo has differentiated itself from other e-commerce companies in that it has achieved profitability for over a year now.

“It is also focused on Asian beauty products that are in great demand in Southeast Asia,” said Kay-Mok Ku, Partner at Gobi Partners, “In particular, we believe that Hermo will continue to benefit from the Korean Wave. We will work with them to establish improved supply chain relationships with suppliers and manufacturers from Korea and other major cosmetics markets.”

Also read:

Malaysia’s Mavcap partners China’s Gobi for $50m fund, focuses on SEA, China

Eko raises $5.7m for messaging platform in Series A round led by Gobi Partners

Malaysia’s Offpeak gets $800k Series A from Gobi Partners

Singapore’s ProperHands raises $177k seed round from Crystal Horse & Tri5

Malaysia’s Cradle to co-invest $7m in four firms

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.