GlamBox Acquired by KSA Consortium
A Saudi Arabia-based consortium of investors has acquired the beauty subscription ecommerce company, GlamBox Middle East. They had previously raised over $4m in venture capital funding from regional investors including STC Ventures, MBC Ventures, R&R Ventures, and KSA strategic investors.
The Saudi consortium, which has acquired GlamBox, has diversified interests in media, retail and hospitality and aims to drive the company’s next phase of growth in Saudi Arabia, the GCC, and beyond. Apostolos Binomakis of Iliad Partners advised the sellers on the transaction as an independent advisor, with the shareholders including the founders, STC Ventures, MBC Ventures and R&R Ventures selling their stake to the new owners.
Co-founders and angel investors Shant Oknayan, Fares Akkad, Christos Mastoras, and Marc Ghobriel launched the Dubai-based startup in 2012. We talked to them about their journey since GlamBox was launched in 2012, including the challenges they faced, the acquisition, and what it means for the future of GlamBox.
Since 2012, GlamBox has expanded geographically in both UAE and KSA initially offering women’s subscriptions. Earlier this year they introduced men’s subscriptions plus ventured into traditional ecommerce. GlamBox established a strong brand in the market and was selected as a Top MENA Startup by Forbes Magazine in 2015, 2016 and 2017 amongst other awards.
GlamBox has partnered with over 200 brands and distributors in the region who keep returning to work with them as an important marketing and sales channel. The team notes that “GlamBox now has full operations in 2 countries, its consumer base keeps growing at lightning speed (5x just in the past year!) and an experienced, well-oiled team led by a strong CEO.”
Where did the idea of GlamBox come from? What gap were you seeking to fill?
We have been involved in the digital space - as entrepreneurs, consultants and executives at large tech and media companies – throughout our careers; we’ve been living and breathing digital all along.
It was at Arabnet Beirut in 2011 – inspired by the participating startups and energized by the overall excitement in the entrepreneurship space - that we decided to “put our money where our mouth is” and launch our own venture. We did our due diligence in terms of hot concepts doing well in the US and Europe and whether there would be a demand for that here in the Middle East while also assessing market and operational dynamics.
We noticed that the beauty subscription business was getting strong backing from the VC community in the West and that the beauty industry was particularly large and fast growing here in the Middle East with very limited online supply. We saw a gap in subscription e-commerce for women in the region, hence, GlamBox was born to service that need in the market.
What challenges have you faced during your journey? How did you overcome them?
We faced all the challenges that an e-commerce startup founded in 2012 in the Middle East would face – nascent business environment for startups, complex cross-border logistics and regulations, funding constraints, lagging payment solutions, hiring strong talent willing to take the leap of faith with us etc., compounded by all the usual operational challenges in building a startup from the ground up.
But we overcame them by focusing on operational execution, while in the meantime the MENA startup ecosystem around us developed significantly in the last few years, making conditions more favorable for us, and all startups.
One of the challenges many startups face is scaling to other markets especially in dealing with bureaucracy. What was the process/difficulty in expanding to new markets?
The KSA market was a very tough one to crack. It is the largest beauty market in the region with very appealing online consumer dynamics, but there were challenges in entering that market, establishing a strong presence and then scaling the business there. We were fortunate to partner with strong KSA-based investors whose valuable help was immensely valuable in opening doors and supporting the business in KSA. On our side, we spent a lot of time on the ground, teamed up with local partners, and hired a team locally, which was key.
What components do you think helped contribute to the success of GlamBox?
The foundation was the strong team that believed in GlamBox and its mission. It’s their hard work and resilience that have shaped GlamBox’s success. We as founders had the vision to seed fund and launch the start-up and empowered the team to build our e-commerce capabilities and deliver a service that delighted our subscribers. It is telling that the CEO and the team grew the business 5x in the last year alone. The investors and partners who supported us throughout our journey further enabled this success.
We are proud to have successfully completed a full lifecycle of a startup in the Middle East – ideation, seed funding, building a team, launch, VC funding over 2 rounds, building a great product, scaling the business, international expansion and finally exit via acquisition within 5 years.
What advice would you give to up and coming startups and aspiring entrepreneurs?
It’s a great time to be an entrepreneur in the region right now. There is more opportunity, support, talent and funding than ever before. But being a founder and an entrepreneur is not easy – there are many challenges to building a startup. To succeed, you need a strong team, resilience, and there is no substitute to operational execution – making it happen. So our advice is: pick the right team, roll up your sleeves, be persistent and make sure to learn along the way and continuously integrate those learnings personally and into the business.