In India’s D2C beauty startup ecosystem, the trajectory has been fairly consistent.
Raise venture capital. Spend aggressively on influencer marketing. Expand distribution, especially offline. And eventually, find an exit.
It is a cycle that has shaped the rise of brands like Sugar Cosmetics, Mamaearth, and a wave of direct-to-consumer entrants that prioritised scale over profits.
Recode Studios is attempting to position itself outside that cycle.
“We are a profitable business,” Dheeraj Bansal, Founder and Managing Director of Recode Studios told OPEN Digital. “We’ve built the company with controlled capital. That’s why we chose the IPO route instead of VC funding. We want to retain ownership and grow sustainably.”
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It is a sharp departure from the dominant narrative. A bootstrapped beauty brand choosing public markets over private capital. A founder openly rejecting the idea of building for acquisition.
But as Recode prepares to list on the BSE SME platform, its story raises a more layered question.
Is this a fundamentally different model, or simply a smaller, more measured version of the same playbook?
Recode’s origins are not rooted in digital ambition.
The company was founded in 2018, built on offline distribution networks developed by Bansal’s co-founder Rahul Sachdeva, who had been working in the cosmetics trade since 2014. His experience spanned markets such as Madhya Pradesh, Chhattisgarh, Delhi NCR, and Chandigarh. Bansal himself came from an entirely different business, bicycle manufacturing, and entered cosmetics through an existing partnership.
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For its first two years, Recode operated as a traditional offline brand.
Then the pandemic disrupted everything.
“Our business was heavily offline-driven, and we were close to shutting down,” Bansal said. “That’s when we pivoted to online. We launched our website in June 2020, post the first lockdown. Since then, there has been no looking back.”
That pivot, born out of necessity rather than strategy, reshaped the company’s trajectory.
Today, around 70% of its revenue comes from online channels, including marketplaces like Nykaa, Amazon, and Myntra, along with its own website. Offline contributes the remaining 30%.
“We are a digital-first brand,” Bansal said.
The brand has also had moments of mainstream visibility. It previously appeared on Shark Tank India, a platform that has helped several consumer startups gain national recall, even if not all go on to raise capital or scale sustainably.
Yet, visibility alone does not build distribution.
Even as Recode leans into e-commerce, it is gradually expanding offline, entering regions like the Northeast and South India, including Assam, Telangana, Andhra Pradesh, and Tamil Nadu.
“Scaling online is much easier. It requires marketing investments but no physical infrastructure,” Bansal said. “Offline growth, on the other hand, is capital-intensive.”
If distribution defines reach, marketing defines survival.
Here, Recode aligns closely with the ecosystem it critiques.
The company spends around 20% of its revenue on marketing, with 12 to 15% going into influencer-led campaigns. That is a significant outlay for a company of its size.
“If we stop marketing, another brand will take our place,” Bansal said. “Influencer marketing is our primary channel, similar to how large brands use TV advertising.”
That dependence on paid visibility is not unusual. What is notable is that it exists despite the company’s positioning as capital-efficient.
Recode attempts to balance this through engagement-led strategies. It conducts makeup masterclasses for aspiring artists and taps into the growing ecosystem of independent makeup professionals in India.
“We teach techniques like foundation selection and eyeliner application. This builds strong engagement and trust,” Bansal said.
The company claims a repeat purchase rate of around 40% month-on-month on its website, suggesting that customer retention is holding up at current scale.
That scale, however, remains relatively modest.
Recode reported revenue of around ₹48 crore in FY25, with a profit after tax of ₹3.15 crore. It is now targeting ₹85 crore in revenue and ₹12 crore in profit for the current year.
“In the first quarter, we closed at around ₹20 crore in revenue, with a PAT of approximately ₹2.75 crore,” Bansal said. “By December, we expect to reach around ₹8.5 crore in PAT.”
The numbers point to aggressive growth, particularly on profitability.
But they also underline a structural reality.
Profitability at ₹50 crore is very different from profitability at scale. As companies grow, costs tend to rise faster than anticipated. Customer acquisition becomes more expensive. Offline expansion demands capital. Brand-building requires sustained investment.
Recode has so far operated below that threshold.
The question is what happens when it crosses it.
The company’s product strategy reflects a familiar pattern in Indian beauty.
Recode positions itself between mass domestic brands and premium global labels. Its products are priced slightly higher than Indian competitors, but significantly lower than international brands, often at 30 to 35% of their prices.
“For example, a moisturizer comparable to a premium global product priced at ₹1,800, while ours is priced around ₹600,” Bansal said.
Its portfolio spans over 100 SKUs, with strong traction in face and eye makeup. Key products include primers, setting sprays, kajal manufactured in Germany, and moisturizers.
“Our key differentiators are high pigment formulations, waterproof and smudge-proof performance, and better coverage with less product usage,” he said.
It is a value-performance play that works in a price-sensitive market.
But it is also widely replicated.
With outsourced manufacturing and benchmarked formulations, the barriers to entry remain low. The real challenge lies in building long-term brand recall.
That context becomes sharper when viewed alongside its IPO.
According to its Draft Red Herring Prospectus, Recode plans to issue up to 28.23 lakh equity shares, including a fresh issue of 25.04 lakh shares and an offer for sale of 3.19 lakh shares by promoter shareholders .
The company will list on the BSE SME platform , a route typically taken by smaller, emerging businesses rather than scaled consumer brands.
The document also flags that there is no existing market for its shares and no assurance of sustained liquidity or stable pricing post-listing .
In practical terms, this means higher volatility and greater dependence on retail investors.
It also places the company in a different league from larger, venture-backed peers it often compares itself to.
Recode’s promoter group remains tightly held, comprising family members and early stakeholders. The company itself was incorporated in 2021 and converted into a public entity in 2025 , even though the brand traces its origins back to 2018.
The business operates on an asset-light model, relying on third-party manufacturing.
These choices allow flexibility and lower capital intensity. They also make the business easier to replicate.
The company, however, is clear about its intent.
“If that were the goal, we would have gone the VC route,” Bansal said, referring to acquisitions. “We are pursuing an IPO because we want to retain ownership and build independently.”
It is a stance that sets Recode apart in an ecosystem built on exits.
Whether it can sustain that stance as it scales remains to be seen.
Because as the company grows, it will encounter the same pressures that define the category. Rising marketing costs. The need for deeper distribution. The challenge of standing out in a crowded market.
For now, Recode represents a disciplined version of the D2C playbook.
But discipline is easiest to maintain at smaller scale.
As it steps into the public markets and pushes toward its ₹85 crore target, the real test will not be whether it can grow.
It will be whether it can grow without becoming the very kind of company it set out not to be.
