From idea to reality
Uncover was founded by Mehta, Jade Oyateru, and Catherine Lee. Mehta has a background in private equity in Africa, while Lee is a Korean living in Kenya and an economist and filmmaker. Oyateru, originally from Nigeria, has worked for companies such as Unilever and Nestlé as well as e-commerce platforms Kasha and Jumia.
After years in the private equity industry, Mehta became inspired to pursue her own entrepreneurial endeavours, rather than just supporting the growth of other businesses. To achieve this, she enrolled in the Antler business accelerator programme in Nairobi, where she met her co-founder, Lee.
The idea for Uncover came from Lee, who identified a gap in the market for skincare products specifically tailored for African women. She proposed building an African brand that leveraged technology from South Korea, which is considered a leader in the global skincare industry.
Mehta was drawn to the idea, as she had her own traumatic skincare experience several years earlier. She always had acne-prone skin and hyperpigmentation and consulted with a top dermatologist in Nairobi but was given a tube of medication with no instructions and the treatment resulted in her entire face being burnt. This gave her confidence a massive knock and Mehta was motivated to build a trusted skincare brand that is anchored in not only health and safety but also efficacy.
In June 2020, the team presented their business proposal to an investment committee at Antler, and subsequently received $100,000 in funding. Oyateru joined the business right after the Antler investment. They spent the following six months establishing supplier relationships in South Korea, reaching out to retailers, working on packaging, developing marketing content, and making their first hires. “Those early days were absolutely crazy. I think we were working like 14-16 hours a day,” Mehta notes.
Mehta explains that the company was cautious in the rollout of its first products. Initially, the plan was to test the market with third-party items from Korea for a year, before developing the Uncover branded products. However, it quickly became clear that the ultimate goal was to build the company’s own brand, rather than becoming just another distributor.
The decision was made to enter the market with sheet masks, an affordable item that retails for about $2 each. Sheet masks are a type of skincare product that are made of a cotton fabric soaked in serum, which is placed on the face to provide various benefits depending on the ingredients in the serum. This allowed Uncover to build a community of women around the product and establish a customer base before introducing more expensive items.
Uncover launched its sheet masks in December 2020, followed by pimple patches, to treat acne, one year later. Nine months after that, it introduced the Baobab Glow-C Serum. The company’s current range also includes Rooibos Glow Toner, Argan Hydrating Moisturiser, Green Tea Revitalising Cleanser and Aloe Invisible Sunscreen.
Uncover outsources its manufacturing to a contract manufacturer in South Korea, but maintains an active role in product development. It works closely with a formula scientist based in the United States, who has experience at L’Oreal. All products include at least one African-grown ingredient, such as baobab, rooibos or argan. Additionally, before any products are released to the market, they are tested on women on the African continent to ensure they are suitable for the local market.
Packaging and branding
Uncover faced some challenges in finding the right packaging and branding approach. Initially, the company worked with a well-known agency in Nairobi but after two weeks didn’t feel that they understood their vision. Eventually the Uncover co-founders decided to move on, although it meant losing some money.
They then hired an agency in the UK for a “ridiculous amount of money”. However, despite numerous tries, this agency too couldn’t get it right. The agency’s interpretation of what Africa is was too cliché. For instance, Mehta says they put baobab trees and Masaai prints on the packaging. That relationship also ended after four months.
The fledgling skincare startup was now $10,000 in the red on design expenses but still didn’t have any packaging. Feeling stuck, the company turned to a graphic designer intern they found on Instagram who at the time recently joined their team for social media. They assigned her the challenge of developing the packaging, and her ideas ended up being the foundation for the final design. Once they had the concept, they then gave it to an expert packaging designer to finalise.
The company’s products are positioned to be affordable to the middle-income segment of the population. It sees itself as “masstige”, meaning affordable to the mass market but perceived as prestigious. The products are slightly more expensive than brands like Nivea and Garnier, but cheaper than high-end luxury labels.
Building a community and knowledge platform
Mehta highlights the strategy of building a digital community and a knowledge platform as key aspects of the business. In addition to launching a six-step online skincare quiz and offering a teleconsultation service through its e-commerce platform, the company also produces skincare-related educational content which are distributed through its social media channels, blog and email newsletter. This focus on community and education has allowed Uncover to increase brand awareness and drive customer retention.
Uncover began by distributing its products through a select group of stores, both online and offline, chosen after conducting a survey on where women typically shop for skincare products. These included East Africa’s largest pharmacy chain, Goodlife, health and nutrition retailer Healthy U, as well as two specialty beauty stores. The company also partnered with online retailers, Jumia and Mydawa. Initially, the larger retailers operated on consignment while others only purchased a small number of units for testing. Over time, these consignment arrangements evolved into outright sales and order sizes increased.
The company launched its own e-commerce platform in March 2021 with the aim of having direct interactions with customers. To handle order fulfillment, Uncover has its own warehouse and partners with Sendy, a third-party delivery service that functions like the “Uber for deliveries”. The e-commerce store has been a significant contributor to the company’s revenue, accounting for approximately one-third of its total business.
Uncover has implemented a data-driven approach in managing its business. While still at the Antler accelerator, before it had launched any products, the founders conducted a survey to gather information on primary skincare concerns and shopping habits from nearly 1,000 women. This survey revealed that less than half of the women were using sunscreen, 40% had acne and were making it worse through harsh scrubs and exfoliation, and only a quarter were adhering to a basic skincare routine.
Additionally, data from its online skin quiz is used to not only suggest products to customers to address their specific skin issues, but also to create a comprehensive customer profile. Uncover also utilises data collected from its e-commerce platform, along with other sources, to inform product development, marketing strategies, messaging, and other business decisions. When deciding on a tagline for its products, Uncover conducted surveys to gather customer responses on different options presented to them. It followed a similar process in terms of its packaging design.
Expansion to Nigeria
Uncover will soon expand to Nigeria, which will allow the company to tap into the second biggest skincare market in sub-Saharan Africa after South Africa. Co-founder, Jade Oyateru, is Nigerian, making it a natural next step. The expansion will also bring economies of scale and increase volumes, allowing the company to benefit from improved unit economics.
Working capital and competitive hurdles
Mehta says one of Uncover’s biggest challenges is managing working capital, specifically the issue of paying suppliers upfront and then having to wait 30 to 60 days for shipments to arrive. To address this, the company is currently in the process of negotiating terms with suppliers. Additionally, growing sales from its own online store is helping with cash flow as it allows Uncover to receive payments immediately.
The CEO also highlights competition from international players with larger marketing budgets as a challenge for Uncover.
credit – howwemadeitinafrica.com