200% Growth Per Year: Why Investing In Feminine Hygiene Was My Best Decision.

The feminine hygiene market is expected to reach 42.7 billion by 2022, an opportunity investors of all genders are starting to tap into. 

Tampon Tribe, a California-based startup producing organic cotton tampons, pads, and silicone-free menstrual cups, was our first investment in this market. Tampon Tribe’s founders reached out to our fund, because they wanted to expand into the Latin American market, and we created an expansion program.

How Plastic Bans Stimulate The Market

In May of 2019, Mexico City voted to ban plastic bags with a broadened restriction on other types of single-use plastics by 2021. Nearly all feminine hygiene products contain plastic and sometimes even artificial colors.

Most tampons and pads are made with plastic, from the applicators and strings to the absorbent synthetics—not to mention the packaging. Companies like Tampon Tribe offer an organic, plastic-free, and sustainable packaging alternative.

We assessed the Latin American market’s price points, looked at potential distribution channels, and chose three countries — Colombia, Mexico, and Brazil. After considering the time and effort necessary to receive approval from local authorities, we decided to start with Colombia.

I have no doubts that Tampon Tribe will be successful in Latin America: in the U.S., the company has great traction, with monthly revenues tripling in 2019. Many trends that start in the U.S. expand into Europe, Asia, and LatAm.

Our Investment Criteria

The feminine hygiene market presents a huge opportunity, and sustainable, organic, plastic-free products are a great niche. Millennial women are becoming more conscious about food and cosmetics and they expect cleaner, safer products. Companies like Tampon Tribe are offering a solution.

At 13 Ventures we greatly value the story behind the founding team. Both co-founders Jennifer Eden and Gaby Alves have years of experience working together, building and expanding businesses in foreign markets. Additionally, they listened to us and were responsive to our suggestions.

One of the things that I loved about the team was their commitment to organic and sustainable products. Eden and Alves source suppliers globally to ensure that all of the companies involved in the supply chain support the highest environmental standards in the industry.

Tampon Tribe had an effective direct-to-consumer approach. However, they also spotted untapped opportunities for growth through other distribution channels, such as co-working spaces, bigger companies, and gym chains.

Consumer Feedback Is The Key To Success

We analyzed the competition and found that even though Tampon Tribe’s product was of premium quality, its price point was on par with other organic products of its kind. As an investor, I always prefer to test the product myself first but, in the case of Tampon Tribe, it was impossible.

Instead, my female co-founder, relatives, and friends helped me with due diligence. To test Tampon Tribe products, we gave samples to almost a hundred people and got their feedback. Every woman who received samples was prepared to pay the premium associated with organic products and sustainable packaging.

Interestingly, some women said that they needed to use more tampons throughout the day, because organic products absorb less liquid than traditional ones. Organic products contain no chemical treatments, so instead of using 3-4 tampons a day, they had to use 4-6.

Our testers felt that the trade-off was worth it, especially considering toxic shock syndrome (TSS) is linked to the use of super-absorbent tampons and a tampon being in place for too long.

What’s Next?

Last year, Tampon Tribe’s monthly sales tripled, a remarkable growth of 200% per year. The team went through an acceleration program in California and is currently fundraising. In the meantime, their priority is expansion in the U.S. while the company prepares to land in LatAm.

There are many costs involved in entering a new market, and we don't want to rush in without the necessary capital infrastructure. Our role is to support their international expansion as soon as they raise the necessary additional funds.

Given the 13 Ventures current investment strategy, we are also looking to finance Tampon Tribe purchase orders from retail players to support their strong growth. The company is partnering with McCann, a global marketing services company with an integrated network of advertising agencies in over 120 countries, to boost its marketing and branding.

Diego Berrio is the founder and managing partner of 13 Ventures