French Beauty Giant L’Oréal Backs China’s LAN in Skincare Play
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A LAN product display. Photo: LAN
L’Oréal Group has taken a minority stake in Chinese skincare brand LAN, the French cosmetics giant said Friday, marking the first skincare investment by its China-focused venture capital arm, Shanghai Meicifang Investment Co. Ltd.
The deal was backed by L’Oréal’s global strategic venture fund, BOLD. LAN is owned by Hangzhou Lanxi Cosmetics Co. Ltd., founded in 2019, and is best known for its “nourish skin with oil” concept. The brand’s offerings — ranging from facial essence oils to cleansing oils and serums — are priced mostly under 200 yuan ($28). L’Oréal noted that LAN develops all of its products in-house.
Prior to the deal, LAN had completed two funding rounds, attracting capital from investors such as Tiantu Capital, Source Code Capital and NX Fund.
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- L’Oréal Group acquired a minority stake in Chinese skincare brand LAN, its first skincare investment via its China-focused venture capital arm, Meicifang.
- LAN led China’s facial essence oil sales by volume in 2023 and 2024; the sector is projected to grow from 5.29 billion yuan in 2024 to 13.9 billion yuan by 2029.
- China’s beauty sector is rebounding, with L’Oréal and Estée Lauder both reporting sales growth in the region.
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Who’s Who
- L'Oréal Group
- L'Oréal Group, a French cosmetics giant, has invested in Chinese skincare brand LAN through its China-focused venture capital arm, Shanghai Meicifang Investment Co. Ltd. This marks Meicifang's first skincare investment. The deal, backed by L'Oréal's global strategic venture fund BOLD, aligns with L'Oréal's strategy to tap into China's consumer market by targeting high-growth niches.
- LAN
- LAN is a Chinese skincare brand specializing in oil-based products like facial essence oils, cleansing oils, and serums, mostly priced under 200 yuan. Founded in 2019, it's owned by Hangzhou Lanxi Cosmetics Co. Ltd. L'Oréal Group's China-focused venture capital arm has taken a minority stake in LAN, marking its first skincare investment. LAN ranked first nationally in facial essence oil sales volume in both 2023 and 2024.
- Shanghai Meicifang Investment Co. Ltd.
- Shanghai Meicifang Investment Co. Ltd. is L'Oréal Group's China-focused venture capital arm, established in 2022. It recently made its first skincare investment by taking a minority stake in the Chinese brand LAN. Previously, Meicifang invested in fragrance brands Documents (8.33% stake in 2022) and To Summer (10% stake in 2024).
- Hangzhou Lanxi Cosmetics Co. Ltd.
- Hangzhou Lanxi Cosmetics Co. Ltd. founded the Chinese skincare brand LAN in 2019. It is known for its "nourish skin with oil" concept, offering products like facial essence oils and serums. L'Oréal Group's venture capital arm, Shanghai Meicifang Investment Co. Ltd., has taken a minority stake in LAN, marking its first skincare investment. LAN has also secured funding from other investors and ranked #1 nationally in facial essence oil sales volume in 2023 and 2024.
- Tiantu Capital
- Tiantu Capital is an investor that had previously provided funding to the Chinese skincare brand LAN. Before L'Oréal's recent acquisition of a minority stake, LAN had completed two funding rounds, with Tiantu Capital being one of the participating investors alongside Source Code Capital and NX Fund.
- Source Code Capital
- Source Code Capital is identified as one of the investors who participated in previous funding rounds for LAN, a Chinese skincare brand specializing in "nourish skin with oil" products. This indicates their early support for the brand before L'Oréal's minority stake acquisition.
- NX Fund
- NX Fund is an investor that previously provided capital to the Chinese skincare brand LAN. This investment took place prior to L'Oréal Group's recent acquisition of a minority stake in LAN.
- Documents
- Documents is a fragrance brand in which L'Oréal's China-focused venture capital arm, Shanghai Meicifang Investment Co. Ltd., took an 8.33% stake in September 2022. Meicifang has also invested in another fragrance brand, To Summer.
- To Summer
- To Summer (观夏) is a fragrance brand in which L'Oréal's China-focused venture capital arm, Shanghai Meicifang Investment Co. Ltd., took a 10% stake in February 2024. This investment is part of L'Oréal's strategy to tap into high-growth niches within China's recovering consumer market.
- Forest Cabin
- Forest Cabin (林清轩) is a beauty brand that reported its 2024 market size for facial essence oils to be 5.29 billion yuan, projecting growth to 13.9 billion yuan by 2029. It holds the top spot in retail sales value with a 12.4% market share.
- Estée Lauder
- In China, Estée Lauder achieved a 9% sales growth, reaching $532 million, marking its quickest regional gain. CEO Stéphane de La Faverie noted that consumer confidence in China is improving, with the market stabilizing and showing modest acceleration.
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What Happened When
- 2019：
- Hangzhou Lanxi Cosmetics Co. Ltd., owner of LAN, was founded.
- September 2022：
- Meicifang invested and took an 8.33% stake in Documents, a fragrance brand.
- 2023：
- LAN ranked No. 1 nationally in facial essence oil sales volume.
- February 2024：
- Meicifang invested and took a 10% stake in To Summer, a fragrance brand.
- 2024：
- LAN ranked No. 1 nationally in facial essence oil sales volume.
- 2024：
- An IPO filing by Forest Cabin pegged the market size for facial essence oils at 5.29 billion yuan and projected a compound annual growth rate of 21.3% to 2029.
- Third quarter of 2024：
- L’Oréal reported mid-single-digit growth on the Chinese mainland, driven by its luxury cosmetics segment and new product lines.
- Third quarter of 2024：
- Estée Lauder posted 9% sales growth in China to $532 million, its fastest regional gain.
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