The Rise of Rhode: Hailey Bieber’s Billion-Dollar Venture
Hailey Bieber’s beauty brand, Rhode, has made headlines with a groundbreaking deal: E.l.f. Beauty is acquiring the brand for an impressive $1 billion. This announcement follows Rhode’s decision to explore deal options just a month earlier, showcasing Bieber’s rapid ascent in the beauty industry. In an interview, she expressed her excitement about the partnership, highlighting how E.l.f. Beauty’s values align with her vision for Rhode. “They support founders and want to help push the founders’ vision,” she stated, emphasizing her readiness to elevate the brand to new heights and expand its presence globally.
E.l.f. Beauty is no stranger to working with founder-led brands, having previously acquired Naturium and collaborated with Alicia Keys on her Keys Soulcare line. This experience proved appealing to Bieber, who described the process of finding a suitable home for her brand as daunting. “This is my baby, and to find a home for it is really not an easy process—it’s very scary,” she admitted. However, upon meeting the E.l.f. team, she was comforted by their shared commitment to community and team-building, which she believes is crucial for Rhode’s growth and success.
The deal represents E.l.f.’s most significant acquisition to date. It comprises $800 million in cash and stock, along with a potential $200 million earnout based on Rhode’s future performance within three years. To facilitate this investment, E.l.f. has secured $600 million in debt financing. The acquisition arrives at a moment when E.l.f. has been experiencing some challenges, particularly due to tariffs impacting its products manufactured in China. Despite these hurdles, the company had previously been a standout performer on the New York Stock Exchange, achieving over $1 billion in net sales last year.
The skyrocketing success of Rhode is noteworthy; since its launch in 2022, it has become the top skincare brand by earned media value. Its impressive net sales reached $212 million in just over a year, all while offering a curated selection of ten essential products. The brand’s growth trajectory has been fueled by viral social media trends, most notably Bieber’s popular “glazed doughnut skin” aesthetic, which has captivated a wide audience. Rhode’s expanding product line now includes not just skincare, but also cosmetics and a partnership with Sephora that will enhance its presence in North America.
As part of this acquisition, Hailey Bieber will remain deeply involved with Rhode, taking on the role of chief creative officer, where she will oversee product innovation and marketing strategies. In this capacity, she aims to continue driving forward innovative ideas that keep the brand fresh and engaging for its audience. The leadership team at Rhode will also continue to operate from Los Angeles, ensuring consistency and a strong foundation for future endeavors. E.l.f. Beauty’s CEO, Tarang Amin, shared that every brand in their portfolio has seen growth, reinforcing their strategy centered on innovation and disruption in the beauty industry.
While E.l.f. has made waves in the acquisition space, Amin emphasized the company’s primary focus on organic growth within its existing brand portfolio. The Rhode acquisition marks a significant milestone, reflecting E.l.f.’s commitment to embracing innovation and pushing boundaries. With previous strategic moves like acquiring Naturium, E.l.f. has effectively doubled its skin care market share and plans to further cement Rhode’s growth alongside its other successful brands. The eyes of the beauty world are now on this partnership, eager to see how Hailey Bieber and E.l.f. Beauty will shape the industry’s future.