Shiseido China First Invests in a Chinese Recombinant Collagen Company

Abstract: Shiseido’s first investment fund in China invested in a Chinese recombinant collagen ingredient company to further promote the high-quality development of the Chinese beauty industry.

On August 10, Beijing time, Shiseido released news that the company led the Series An investment in Chinese recombinant collagen raw material company Trautec, with an investment amount of nearly $14.8 million. It is understood that this is the first investment of Shiseido’s first investment fund in China, Ziyue Fund.

In May this year, Xiamen Ziyue, the entity of Shiseido’s first special investment fund in China, was officially established. According to public information, Xiamen Ziyue has a total registered capital of $74.1 million, of which Shiseido occupies 98%. As Shiseido China said at the establishment of Ziyue Fund, Ziyue Fund focuses on the investment opportunities of emerging brands and upstream and downstream related technology companies in the frontier markets of beauty and health, so the first investment was made to a biotechnology company.

According to public information, the company that received the investment from Shiseido, Trautec, was established in 2015 and is dedicated to the research, development and production of recombinant collagen-based biomaterials. The company claims to have achieved two major technological breakthroughs: the construction of a stable genetic expression system for recombinant type III collagen yeast and the development of a 30-ton stable fermentation and purification technology.

In terms of product development, according to the official website of Trautec, the company has developed recombinant type I collagen, recombinant type III collagen and recombinant type XVII collagen, all of which are recombinant humanized collagen. Qian Song, CEO of Trautec, said, “This round of investment by Ziyue Fund is a strong endorsement for Trautec, which accelerates the pace of R&D innovation and development of the international market.”

In the past two years, the recombinant collagen sector in China has been in full swing. According to Grand View Research, China’s collagen market size is $983 million in 2019 and is expected to reach $1.576 billion by 2027, with a CAGR of 6.54%, higher than the global market growth rate.

Currently, the market for recombinant collagen in China is occupied by Jinbo Bio, Giant Biogene, and Trauer Bio. From 2019 to 2021, Jinbo Bio’s revenue was $23 million, $23.8 million, and $34.5 million, respectively. During the same period, Giant Biogene’s revenue was $141.6 million, $176.3 million, and $229.8 million, respectively. Trauer Bio’s revenue is 303 million yuan, 303 million yuan and 240 million yuan respectively. Jinbo Bio and Giant Biogene have also been planned to be listed on the Beijing Stock Exchange and Hong Kong Stock Exchange respectively. It can be seen that the recombinant collagen market will continue to grow at a high rate in the next few years and the end-use applications in the medical beauty and cosmetic industries will be increasingly expanded.

Shiseido has been researching collagen ingredients for more than 40 years. For example, in 1983, Shiseido founded ELIXIR, a brand that specializes in collagen. It is now one of Shiseido’s main brands. At present, the best-selling product in ELIXIR flagship store on the Chinese e-commerce platform Taobao is Elixir Lifting Moisture Lotion and Emulsion with monthly sales of 2000+. The set is priced from $90.3. In this year’s Chinese 618 Shopping Festival, sales achieved $30,932 in ELIXIR flagship store on TikTok. Also, in 1996, the collagen supplement brand The Collagen was created, a women-only beauty brand under Shiseido that focuses on collagen supplement products.

Currently, functional skincare products are favored by more and more consumers due to their professional health backgrounds. The segments including anti-sensitivity, anti-aging, strong efficacy, clean beauty, and post-process are emerging. Thus it becomes a segmentation sector for forwarding deployment in Shiseido China.

According to an incomplete count, at least 15 synthetic biology companies have announced funding since 2022. Not only Shiseido, but also L’Oréal China has set up a fund this year with the aim of investing in innovative companies and emerging brands. Among Chinese companies, Bloomage Biotech and Winona’s parent company, BTN, have also set up private equity funds to focus on skin-related basic science.

It can be said that, for the moment, companies with scarce ingredients and technological R&D barriers have become the value plateau in the cosmetic industry chain while major Chinese and international beauty companies have entered the game.




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