Wellness is the next frontier for beauty investors.
After Unilever acquires Nutrafall at an estimated $1 billion valuation and Compass Diversified acquires Honeypot in a deal with an enterprise value of $380 million, investors are looking for next opportunities in the space. I’m looking for.
reason? While the traditional beauty market is saturated and competition is fierce, the fusion of beauty and health is attracting investor interest. In particular, she is paying attention to supplements and women’s health at an unprecedented pace.
“There is a huge opportunity for M&A in this space,” said Eliza Becker, vice president at VMG Partners, whose portfolio includes Goli supplements and Ancient Nutrition powder.
This trajectory is attracting attention from various brands.
“Until recently, we were literally being turned down because we didn’t have a strong enough exit track record in this space,” says Nadia Okamoto, founder of menstrual care brand August. “As we’ve seen with The Honey Pot and the Knicks, exits are supporting the entire industry. … We’re communicating that to potential investors and saying, ‘This is what the multiples look like in this space.’ You can say that.
As always, traditional strategies are being looked at as to who is interested from an acquisition perspective. Among them are hair care, skin care, top-notch beauty, and health and well-being. This follows several significant acquisitions over the past few years in the supplements category, including Nutrafol, Olly, Liquid IV, and SmartyPants Vitamins.
We are also looking for new players. Recent pharmaceutical spin-offs such as GSK’s Haleon and Johnson & Johnson’s Kenvue are expected to play a key role, and private equity is also understood to be actively pursuing the field.
Then there are international strategic companies, especially those based in Asia, and players on the left who want to have a deeper footprint in the US market. New York-based Forum Brands, formerly an Amazon aggregator, acquired period care brand Lola in January 2024.
“While both strategic and private equity investors are actively participating in this category, many of these businesses are in the early stages of growth, consolidation and “Private equity activity is increasing given the service component.”
For private equity, the scalability of these brands is incredibly attractive.
Lisa Wu, partner at Norwest Venture Partners, an investor in supplement brand Ritual, said:[Buyers are] I’m looking for a brand. They want scale. They want regular and resilient demand. ”
When it comes to hot targets, supplements and women’s health that drive repeat purchases are high on investors’ wish lists.
Ritual, which makes significant contributions to women’s health and has raised $65 million to date, is believed to be gaining interest and could be ripe for an acquisition. The brand is sold at Target and Whole Foods and has formulations that address many of the key concerns identified across women’s health, including prenatal and postnatal.
Similarly, microbiome health company Seed, known for its ingestible DS-01 Daily Synbiotic, is said to be in the market with Jefferies managing the deal, although both companies declined to comment. According to sources, the intestinal health field in which Seed participates will attract particular attention in the future. A Mintel report predicts that the US digestive health market will reach $6.5 billion by 2027.
Other notable supplement names include adaptogen beauty and health company Moon Juice and vitamin product line Ham Nutrition, both of which have secured funding in the past and have significant retail footprints. is left behind.
At the same time, women’s health is a particular hot topic as brands aim to fill research gaps in this area. According to McKinsey, investments that address women’s health disparities “could boost the global economy by at least $1 trillion a year by 2040.” While this category is broad in nature, current hot spots include menstrual care, vaginal health, fertility solutions, and maternal and prenatal and postnatal products.
Sources say it’s still early days, but potential future targets include cycle sync brand Rael, which raised $35 million in 2022. Also targeted is Love Wellness, a supplement and personal care brand developed by Roe Bosworth and currently sold at Target, Walmart and Ulta Beauty, and OPositiv, an ingestible women’s health product line. You can purchase it at
Experts predict that when it comes to menopause, especially as new research results are published, a wave of new product innovations will eventually expand the sluggish field. Additionally, as Millennials age into the category, the discourse will grow in a way that leads to sales.
“There will be a surge of millennials turning 40. They won’t be satisfied with the status quo where everyone just suffers in silence, because they want to feel empowered. Because a lot of education is being found online,” Wu said. .
While brands like Womaness and Bonafide dominate the conversation when it comes to menopausal health, other supplement brands like OPositiv and Hum Nutrition are also tackling menopausal health with one-time products.
Product diversity will again be essential, as Bonafide led to its $425 million acquisition by Pharmavite. Experts suggest that exploring women’s health more broadly, rather than just focusing on menopause, may be more successful.
“To scale, we need to build a women’s health platform,” Wu said.
There’s also sexual wellness, and while there’s a lot of buzz around this category, sales have slowed a bit.
“There’s probably not a lot of interest in the device because it’s a one-time sale,” said Jeffrey Barber, managing director at private equity firm TA.
Therefore, experts say sexual wellness brands may have a better chance in the market if they leverage everyday products such as lubricants and supplements. For example, Maude, one of the most talked about brands in the category, has enjoyed retail success, particularly at Sephora, due to its buzzy product lines such as lubricants and body washes. Other players in this category with both devices and topics include Smile Makers and Dame.
Whichever category you choose, one thing is for sure: investors are starting to make early bets on the future of the entire sector.
“There will be a breakthrough moment in two or three years where these categories suddenly become huge…Categories take a long time to build,” Becker said.
But as the wellness market grows and investors’ interest in the category increases, brands will need to stand out, especially through expert scientific evidence.
“Strategists want to see actual product clinical trials to demonstrate differentiation,” Wu said, adding that efficacy will be a key factor for both consumers and investors.
