French cosmetics giant L’Oreal said on Monday it had chosen to invest in five tech start-up firms in the beauty products sector along with partner Founders Factory, as L’Oreal steps up its ventures in this area.
In 2012, L’Oreal set up an internal start-up unit in Silicon Valley and in May last year it invested in Founders Factory, a digital incubator, co-founded by Brent Hoberman, former chief executive and co-founder of lastminute.com.
L’Oreal and Founders Factory announced on Monday they had chosen the companies InsitU, Preemadonna, Tailify, Veleza and Cosmose for their incubator fund, to help the companies develop.
All five companies use Internet and mobile technology to promote their products, with Veleza and Cosmose founded by Lithuanian and Polish entrepreneurs respectively.
L’Oreal made more than 5% of its sales online in 2015. Its digital team, which counted some 150 people five years ago, now totals more than 1,000, with hundreds hired in 2016.
In 2015, L’Oreal spent 25.5% of its advertising budget on digital communications and the proportion is expected to grow as more consumers, particularly in regions such as the Middle East, use the Internet for beauty tips and purchases.