The Australian Business Growth Fund (ABGF) has taken a $10 million equity stake in sun protection garments company Solbari.
The new investment will be used to scale up the company focusing on targeting younger people and increasing wholesaling which currently accounts for about 10% of the business.
Established ten years ago, Solbari has achieved rapid growth over the last three years, growing from 10 employees to 25. The ABGF funding is expected to enable the company to grow to about 40 employees over the next three years.
The concept for Solbari resulted from personal experience. Relocating to Melbourne from Europe in 2011, finance sector executive Johanna Young was surprised by the prevalence of skin cancer in Australia. When she researched the issue, she discovered the best way to avoid skin cancer was wearing appropriate clothing but was shocked to discover a typical white cotton t-shirt offered protection only equivalent to SPF5.
While volunteering at a Cancer Council retail store, Young heard accounts of how difficult it was to obtain sun protective garments that were light, breathable and stylish.
That convinced her to give up her job and establish Solbari.
“I realised the critical need for accessible, well-made and reliable sun-protective garments. It became clear that there was an untapped opportunity to bridge the gap between style and safety in the realm of skin protection,” she said.
Today, led by Young as chief executive, Solbari offers a range of clothing, swimwear, sun hats and accessories ranked at the highest sun protection level of UPF50+ (equivalent to the protection of SPF50+ sunscreen).
The company is one of few brands endorsed for sun protection by dermatologists and accreditation authorities.
Sales have been made to more than 300,000 customers in over 160 countries.
ABGF co-head of investments Ghazaleh Lyari said: “Investing in Solbari was particularly compelling to ABGF due to its specialisation in sun-protective offerings focused on addressing a customer cohort with health concerns; the products are not considered as discretionary spending but rather essential items.
“Moreover, the versatility of this business model positions it with a diverse potential for growth, opening the door to strategic partnerships that include retailers, corporates with stringent Ocupational Health and Safety requirements and organisations catering to the specific needs of employees including council workers, construction workers, sports clubs and educators.”
ABGF, is a public-private partnership set up by the federal government and six leading trading banks with initial capital of $540 million. The fund was established to bridge the gap between late-stage venture capital and private equity investment, particularly for businesses that require patient capital. The fund only makes minority investments and seeks to enable founders to retain control while accessing growth funding.
The then Liberal federal government committed $100 million to the fund in late 2019 alongside $100 million commitments each from ANZ, CBA, NAB and Westpac banks and $20 million each from HSBC and Macquarie banks.
Image: A Solbari UPF 50+ t-shirt.