Good Glamm CEO Sanghvi blames 'too much, too fast' strategy for collapse

Business Standard

4 days ago

Darpan Sanghvi, Chief Executive of embattled beauty conglomerate Good Glamm Group, said the startup's rapid expansion strategy backfired when the company tried to do 'too much, too fast, too big' simultaneously. This created a "momentum trap" that ultimately damaged the once-promising unicorn, letting down employees who believed in his vision of building a digital consumer-goods empire in two years instead of 10.
'Momentum is intoxicating. Until you drown in it,' said Darpan Sanghvi, group founder and CEO of Good Glamm Group, in a LinkedIn post on Friday. 'We did: 1) Too Much. 2) Too Fast. 3) Too Big. These were the three levers we pulled – each powerful, each risky. Any two of them, we might have survived. We might have even thrived. But all three, together, at once? That was the point where momentum stopped being fuel and became fire.'
Once a high-flying unicorn, last month Sanghvi revealed that Good Glamm Group is being dismantled as lenders move to sell off individual brands. Built on an aggressive acquisition spree—11 deals in rapid succession—the company struggled with integration, rising debt, cash burn, and founder exits. Operational chaos and missed salary payments signaled deeper financial distress. Sanghvi has publicly taken responsibility for strategic missteps. The breakup marks a cautionary tale of over-expansion in India's consumer tech sector.
"You tell yourself you'll fix the leaks after the next milestone. But the milestones keep coming, and so do the leaks. Soon, you're running from fire to fire, never realising that the whole building is getting hotter,' said Sanghvi.
The Mumbai-based company, founded in 2015 by Darpan Sanghvi and later joined by Priyanka Gill, Naiyya Saggi, and Nowshad Rizwanullah, has raised a total of $342 million from investors like Warburg Pincus, Prosus, Bessemer Venture Partners, Accel, L'Occitane, and Amazon, according to data from Tracxn. As of April 2024, its valuation stood at $1.25 billion.
'Every headline, every funding round, every big launch is a shot of adrenaline. And you start believing you can do more and more and more,' said Sanghvi.
The company's troubles stem partly from an aggressive acquisition strategy that failed to deliver expected returns. In recent years, Good Glamm Group acquired several companies, including The Moms Co, Sirona Hygiene, BulBul, Organic Harvest, Vidooly, MissMalini, and ScoopWhoop. However, industry sources said that the company's 'inorganic strategy' has not yielded the expected benefits.
'When you're in [the fog of war], the noise is deafening, the pace relentless, you don't see the cracks forming, and you're making calls with incomplete information,' said Sanghvi.
The cash crunch had already forced significant cost-cutting measures. In 2024, Good Glamm Group reduced its workforce by 15 per cent, or 150 employees, as part of a restructuring exercise. At that time, the company employed approximately 850 people, down from about 1,000 before the layoffs.
'You lose the stillness to think. You lose the ability to celebrate wins without feeling the shadow of the next challenge. You lose sight of the craft, the joy that made you start,' said Sanghvi.
The company's financial performance reveals the scale of its challenges. While it achieved a 2.5x increase in revenue in FY23, reaching Rs 603 crore, up from Rs 240 crore in FY22, it also reported massive losses of Rs 917 crore during the same period. The company has not yet filed its annual report for FY24, raising additional concerns about transparency.
The group's crisis reflects broader challenges facing Indian startups that pursued growth-at-all-costs strategies during the funding boom. The beauty and personal care market requires substantial marketing spend to build brand awareness, contributing to high cash burn rates that become unsustainable when funding dries up, analysts say.