In the past few years, the beauty industry has gone from unicorn mania to an oversaturated, underperforming mess. And the most recent wave of shutdowns in color cosmetics is proof. These aren’t just under-the-radar brands quietly exiting. These are brands with impressive backers, distribution at Sephora and Ulta, founder buzz, and even celebrity firepower. So what went wrong?
Disenchantment in Color Cosmetics
In the last few days, we’ve been on calls with strategic buyers, LPs, bankers, and beauty founders, and the word that kept coming up was "disenchantment." In 2021 and 2022, the beauty sector saw massive valuations and M&A interest. Investment bankers were shopping some of the buzziest names: Summer Fridays, Makeup by Mario, Rare Beauty, Merit. Yet the recent acquisition of Rhode by e.l.f. marks one of the only true exits to hit headlines.