New Delhi, July 4 -- Beauty and personal care company Good Glamm Group is in talks with its lenders to restructure its debts even as it struggles to secure cash to cover operational costs and pay its employees and vendors, its chief executive admitted.
The company has held "several restructuring discussions" in conjunction with its lenders, CEO Darpan Sanghvi said in a social media post. He didn't provide any details and a company spokesperson declined to comment on VCCircle's queries.
The admission came after Good Glamm faced the ire of former employees and vendors, who took to social media to vent out their frustration with the company's lack of progress on clearing salary and other payment dues.
The cash-strapped company has delayed salaries and payments to former employees who were laid off since April, while some vendors on social media have complained of payment delays since January.
Sanghvi admitted the delays and blamed the scarcity of funds to the falling apart of a deal with a company to sell one of its businesses last year. Sanghvi said the CEO of the said company stepped down "at the last moment". This triggered a "chain of financial strain" resulting in salary delays and operational payment disruptions, impacting business and generating cash flows hard. As a result, Good Glamm is finding it difficult to raise money, he added.
"We've been sending regular updates via email, but the progress is slow, and that has understandably compounded the collective frustration," Sanghvi said in the LinkedIn post.
According to media reports in recent months, the company has been in talks with investors to raise between Rs 150-200 crore at a significantly lower valuation. Good Glamm, which became a unicorn in 2021 after investments from Warburg Pincus and Prosus, owns a portfolio of beauty and personal care brands. Its last reported funding round was in March 2024, when it raised $30 million from existing investors.
In a bid to build a 'house of brands', Good Glamm embarked on an inorganic growth route in the past few years, acquiring companies like The Moms Co, Organic Harvest, and Winkl. Its pivot to an omnichannel model, increased spending on marketing and visibility of products among other things, resulted in cash burn and mounting losses, as per media reports.
Board members from Accel India, Bessemer Venture Partners, and Prosus Ventures have also resigned in recent months, underscoring deeper investor concerns.
To secure cash to fund operations and cut losses, the company laid off several of its employees and has been divesting some of its brands in recent months. Some of the companies have been sold for a fraction of the cost Good Glamm had acquired them for. These include digital media platforms MissMalini and ScoopWhoop, and feminine hygiene brand Sirona.
Published by HT Digital Content Services with permission from VC Circle.