Billion-dollar acquisition of Hailey Bieber's beauty brand.
In a significant move in the beauty industry, Hailey Bieber has sold her skincare brand, Rhode, to e.l.f. Beauty for a reported $1 billion. The deal, announced on Wednesday, will see Rhode join e.l.f. Beauty's portfolio, which includes brands like e.l.f. Cosmetics and Keys Soulcare.
The sale marks a significant milestone for Bieber, who co-founded Rhode in 2022. The brand, known for its minimalist aesthetics and natural beauty focus, generated $212 million in revenue last year. "We can't wait to bring Rhode to more faces, places, and spaces," Bieber said in a statement.
Despite the sale, Bieber will remain with the company as the Chief Creative Officer and Head of Innovation. Sharing her thoughts on Instagram, Bieber expressed her excitement about taking on an "even bigger role" in the company. The 28-year-old model also shared that she would continue to serve as a strategic advisor to e.l.f. Beauty.
The acquisition is a strategic move for e.l.f. Beauty, whose CEO, Nick Vlahos, noted that Bieber's "rapidly growing beauty brand" aligns perfectly with their vision. Rhode plans to launch a physical in-store partnership with Sephora across North America and the U.K. by the end of 2025, aiming to expand its global reach and accelerate growth.
The success of Rhode reflects a broader trend in the industry, with celebrities increasingly leveraging their influence for lucrative business models. For instance, Kim Kardashian's shapewear brand, Skims, is now valued at $4 billion. With this deal, Rhode becomes one of the most valuable celebrity-owned companies.
The agreement includes $800 million payable at closing, with $600 million in cash and $200 million in newly issued shares of e.l.f. Beauty common stock. There is also a potential earnout of $200 million, contingent on the brand's future growth over three years. The deal is expected to close in the early fiscal year 2026, marking the preliminary peak of an impressive career trajectory for Hailey Bieber, transitioning from model to billionaire.
The Commission has also been consulted on the draft budget related to the $1 billion acquisition of Hailey Bieber's skincare brand, Rhode. This deal, driven by a strategic vision, will not only expand Rhode's presence in the beauty industry but also open avenues for finance and entrepreneurship, potentially attracting investors interested in the fast-growing celebrity-owned businesses. The financial implications of this transaction, including the potential earnout of $200 million, will impact the financial outlook for e.l.f. Beauty.
