Where We’re Investing Now: Specialized Scent
We use fragrance to enhance our homes, set a mood, and calm our minds. Recently, fragrance has evolved into a vibrant form of self-expression: Gen Z is setting trends on social media by discovering and mixing scents into unique blends. More and more products and brands are emphasizing scent, and tech is opening new pathways to creating, testing, and personalizing, resulting in a remarkable surge in the global market — A worldwide valuation of $53.7 billion in 2023 and a projected annual growth of 5.9% through 2030. In the United States alone, the fragrance market is $8.7 billion.
Historically, scent-based commerce has been dominated by established incumbents and a tired retail experience. However, recent advancements in AI and data are paving the way for a new, more enjoyable, and more accurate shopping experience. This is the moment to break the old guard.
One of our standout investments in the field is Scent Lab, a disruptive brand that has reimagined the fragrance discovery process through a personalized algorithm. Launched in November 2022, Scent Lab quickly garnered attention for its tech-enabled solution, which uses AI to connect customers with their ideal scents at an affordable price. By bringing the consumer into the curation process, Scent Lab is very accurately able to match compatible fragrances from future collections to their customer’s preferences. Intending to become the “scent center” for young consumers, the business is initially focusing on candles but plans to expand its discovery platform to encompass a myriad of other perfume and fragrance opportunities. Scent Lab is off to a great start and has seen significant love from Gen Z.
Our fund’s interest in fragrance investment stems from a wider interest in innovative new brands and business models, and Scent Lab is a fantastic example: by accurately assessing and remembering customer preferences, this model removes the need to go to a physical store to shop. We are also very excited to see fragrance and the wider wellness movement merge, as people begin to turn to olfactive means for stress relief and mood control. This can take many forms, from opting for a personalized candle or essential oil to create a soothing effect on your living space to choosing personal care products with scents that perform actual functions, like energy stimulation.
As a fund, we are eager to help reshape the scent landscape through early-stage investments in pioneering olfactory companies. Is your company innovating in fragrance and aroma? Get in touch — we’d love to hear from you.
By Investment Principal Jenna Jung
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Where We’re Investing Now: Gen Z
