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Pinkie, the New York-based maker of period pads for tweens and teens, raised a $1 million seed, founders Fiona Simmonds and Sana Clegg tell Richard.

Why it matters: The market for feminine hygiene, health and wellness products is expected to grow at a compound annual growth rate of mid- to high-single digits.

That accounts for a growing number of startups such as The Honey Pot Co. and new investment funds focused on the space from firms such as Amboy Ventures.

Details: Proceeds from the raise will be invested in marketing and product runs as Pinkie launches in 500 Target stores, the founders say.

Raising funds from male investors proved difficult — until the founders asked them to take the idea back to their wives and daughters for their opinion on market needs.

That's when the round began gaining more traction, to the point it was oversubscribed, the founders say.

What's next: Pinkie wants to launch a tampon product.

If it snags another national retail partner, Pinkie will look to raise a Series A, Simmonds and Clegg say.

How it works: Pinkie's pads are smaller in design to accommodate the bodies of adolescents, for whom adult-sized products are too large.

To date, CPG companies' answer has been to take an adult-sized pad and place it in a box marketed to tweens and teens — which doesn't solve the initial problem, the founders say.

Pinkie's pads are organic, plant-based and hypoallergenic, though there is a film made of plastic used for the back sheet to prevent liquid from leaking (the company hopes to develop an alternative).

Each pad comes with a slip-out baggie, which can hold the used product for easy disposal later on.

Of note: Though the founders began selling the brand via their website — and it is a top 50 seller on Amazon — they do not think of Pinkie as a DTC.

To test and then sell the products, the company made the pads available in private girls' schools.

The intrigue: Pinkie deposited its early seed money with Silicon Valley Bank not long before the bank collapsed.

In fact, the startup was going to announce its raise on March 10 — the day that the U.S. government took control of SVB.

Simmonds says she was at her daughter's birthday party when her husband alerted her to SVB's troubles, which triggered a panic-filled weekend.

Simmonds was ultimately able to access the cash and Pinkie began banking with Chase.

The bottom line: CPG incumbents will either have to "compete with us or come talk to us," Simmonds says.

1 big thing: Pinkie raises $1M for adolescent period products

A teen girl holds four different versions of Pinkie-branded period pads.

Permira, KKR and Famille C Participations, Clarins SAS' investment vehicle, join a long list of suitors vying for a piece of beauty brand Aesop, Bloomberg reports.

Why it's the BFD: Despite weaker consumer spending and inflationary pressures, the beauty and wellness segment has been resilient, Kimberly writes.

Catch up fast: L’Oreal, LVMH and Japanese beauty group Shiseido were previously reported to be considering a bid earlier this year.

CVC Capital and L’Occitane International were among the other bidders, per Bloomberg.

Flashback: Late last year, Aesop parent Natura & Co. said it was looking for ways to unlock value in Aesop, and considered a possible IPO or spinoff, but opted to go for a minority stake sale due to unfavorable capital markets.

Bank of America and Morgan Stanley have been working with the company since last year.

The deal could value the Australian beauty brand at more than $2 billion.

Natura acquired a majority stake in Aesop for AUD $68 million in 2012.

The intrigue: An Aesop stake sale could improve the company’s financial position, S&P Global Ratings said in a report.

Though the parent company posted higher-than-expected leverage metrics (a debt-to-EBITDA ratio of 4.7x at the end of 2022, compared with the agency’s forecast of 4x), S&P says its ratings on Natura & Co remain unchanged.

“This is because of a potential near-term sale of its subsidiary Aesop that the company announced that it is seeking in fourth quarter 2022, which could significantly reduce leverage,” the agency says, adding the company has made some progress toward improving cash flow and reducing expenses.

Natura, L’Oreal, Permira and Famille C Participations didn’t immediately respond to comment. KKR declined to comment.

2. The BFD: New suitors circle Aesop

illustration of a dollar bill with george washington wearing a blue clay face mask and cucumber slices over his eyes

🤖 Autonomous delivery robots have been spotted lining up outside a Manchester, England, supermarket, Axios What's Next reports today.

The robots, made by Starship Technologies, travel at up to 4 mph and use cameras and other sensors to navigate.

They can even wait until the street is clear of traffic before crossing the road, and they activate an alarm if tampered with.

👟 Designer Brands has a goal of doubling its sales from its owned brands to represent about one-third of revenue by the 2026 fiscal year, and it’s making progress thanks to acquisitions and partnerships, Modern Retail reports.

The company is tying a bow on an exclusive licensee agreement for Hush Puppies in the U.S. and Canada, and it has already added Le Tigre, Topo Athletic and Keds under its fold last year.

This comes at a time when the footwear industry is thinking about ways to expand its direct-to-consumer avenues.

Freshpet, a maker of refrigerated fresh pet food targeted by activist investor Jana Partners, is likely to put out feelers to potential strategic acquirers to get a sense of the current market.

But as Axios previously reported, due to public comments from would-be buyers, Freshpet needs to prove it can grow profitably.

Jana continues to call on the company to sell itself, and that may eventually happen, but the timing doesn't look good right now.

3. Retail therapy

Illustration of a therapy couch with a pillow made of money.

• Deerpath Capital Management raised $1.5b for its fifth senior debt fund focused on midmarket companies. www.deerpathcapital.com

• PhonePe, an Indian payments and financial services firm, raised $200m from Walmart. https://axios.link/3ZTlXni

• Nimble, an SF-based autonomous logistics and AI robotics startup, raised $65m in Series B funding. Cedar Pine led, and was joined by insiders DNS Capital, GSR Ventures and Breyer Capital. www.nimble.ai

• Bullish raised $50m for its second fund focused on early-stage U.S. consumer startups. www.bullish.co

• Parker, a provider of corporate credit cards to e-commerce businesses, raised $37m in equity funding led by Valar Ventures and $70m in debt from Triple Point Capital. https://axios.link/3Ltl0h9

• Reebelo, a refurbished consumer electronics marketplace, raised $29m in new Series A funding (round total now $50m). Cathay Innovation led, and was joined by Moore Strategic Ventures, Gandel Invest and antler. www.reebelo.com

• LongueVue Capital invested in RBW Logistics, an Augusta, Ga.-based provider of warehousing, and fulfillment services. www.rbwlogistics.com

4. Retail transactions

• Gabe Kleinman joined Emerson Collective as an operating partner on the venture capital team. He was previously at Obvious Ventures. www.emersoncollective.com

• Lindsey Press joined HGGC as global head of investor relations. She previously was with Silver Lake. www.hggc.com

• John Hayes, former chairman and CEO of Ball Corp., joined Clayton, Dubilier & Rice as an operating advisor. www.crd-inc.com

• Laxman Narasimhan has officially started his post as CEO of Starbucks, nearly two weeks earlier than slated. https://axios.link/3lpEZT5

5. It's Personnel

Welcome back, Retail readers. Happy Monday.

📦 Situational awareness: Amazon to cut 9,000 more jobs, CEO Andy Jassy said in a memo to staff.

🍕 What we’re eating: One of the things Kim missed while traveling was the pizza rossa with fresh mozzarella at Jersey City’s Bread and Salt.

🙏 Big thanks to newsletter editor Claire Rychlewski and copy editor Mickey Meece for today's edits.

Thank you for reading Retail Deals! We'll see you again tomorrow.

March 20, 2023

1 big thing: Pinkie raises $1M for adolescent period products