Established in 2013, Seoul-based LYCL consists of three entities: unpa.me, a review and content platform; palett.me, an influencer network platform; and unpa.Cosmetics, a beauty brand.
LYCL was one of the first K-beauty start-ups to join Beiersdof’s NIVEA Accelerator (NX) programme. Beiersdorf later acquired a significant stake in the start-up and became its second largest shareholder.
“We received our first funding from Beiersdorf during the NX program. It was really beyond our expectations in terms of the support we received and the collaboration projects. We received dedicated support to expand our offline distribution in Korea, we also co-defined our strategy to enter South East Asia with the Beiersdorf team in Thailand,” said LYCL VP Manhwi Han.
The support from the German personal care major helped to accelerate LYCL’s business by 130% in 2019.
On September 15, Beiersdorf announced that it was strengthening its existing engagement with LYCL by participating in the $5m Series B funding.
“We are thankful for the contribution as well as the valuable collaboration from an early stage onwards with NX. This follow-on investment shows the continuing commitment of Beiersdorf and the company’s confidence in our plan for success on a larger scale, especially beyond Korea,” said Jeon Jihoon, founder and CEO of LYCL.
Expanding beyond Korea
The start-up plans to use the majority of funding to engage in new product development, marketing and global expansion.
“Our key market is South Korea at this moment, but we see very positive response from Japanese consumers via cross-border e-Commerce. In addition to Japan, we are looking at China and SEA as our next target markets for growth,” said Han.
The firm plans to enter new markets through online channels first before moving forward with offline expansions.
It hopes to tap into new opportunities in live commerce, which has accelerated in popularity due to the novel coronavirus (COVID-19) pandemic.
“One opportunity we see now emerging in Korea is live commerce, which is the next stage in the evolution of digital media. We are now moving fast to capture this opportunity and develop new content for our own live commerce business.”
Additionally, the company is aiming to explore opportunities in the physical retail space.
“We have a very solid online business based on direct-to-consumer sales via our own website. But this year we have expanded more strategically into offline retailers to grow brand awareness. Our best-selling items from lip care and dental care sold over one million pieces already, but we see still additional room to grow,” said Han.
Pushing new product development
The company also plans to extend its product portfolio, specifically in skin care.
“In terms of new categories, we are now seeking the opportunity of the face care market with a dedicated product line-up. This will be certainly one key area of investment from our side,” said Han.
LYCL has recently collaborated with Beiersdorf to co-develop a new skin care brand, a project Han said was one of the companies’ biggest achievements to date.
“It’s the first time Beiersdorf is working with a start-up to develop a new brand, so it was really an exciting project. We have been partnering on consumer research with our beauty platform, as well as design, packaging development and digital content.”
Han did not reveal more details but said the brand will be launching in the coming weeks.