Elf Beauty has announced its acquisition of Rhode, the beauty and skincare brand founded by Hailey Bieber, in a deal valued at $1 billion. The transaction, which is pending regulatory approvals, marks one of the most significant beauty industry acquisitions in recent years. Rhode, launched in 2022, has rapidly established itself as a disruptive force with just 10 products and a direct-to-consumer (DTC) strategy. According to Elf Beauty CEO Tarang Amin, the brand achieved $212 million in net sales in under three years, driven by Hailey Bieber strong creative vision and authentic connection with consumers. The agreement will include $800 million in cash and stock, along with a $200 million earn-out based on future growth over three years.
Hailey Bieber will remain at the helm of Rhode, continuing as founder and expanding her role to chief creative officer and head of innovation. In addition to leading product development and marketing, she will also serve as a strategic advisor for both Rhode and Elf Beauty. “I want to be the biggest beauty brand in the world, and I believe that Elf is going to help me get there,” Bieber said. The acquisition adds Rhode to Elf’s growing portfolio, which includes Naturium, Keys Soulcare, and Well People.
Driving Rhode’s Meteoric Rise
Since its inception, Rhode has stood out in a crowded market, combining viral aesthetics, influencer-led marketing, and innovative product launches. From pop-up experiences and photobooths to its standout lip gloss phone case, the brand has consistently delivered buzz-worthy campaigns. In 2024 alone, Rhode generated an estimated $400 million in earned media value (EMV) with an engagement rate of 3.75%, outpacing the industry benchmark of 3.6%, according to data from influencer marketing platform Lefty.
The brand’s recent retail debut at Sephora signals a strategic shift beyond its DTC roots, aiming to maximize reach and revenue. Hailey Bieber attributes Rhode’s success to deliberate product curation and immersive marketing, stating, “We’ve been very strategic about product, marketing, and creating tasteful, exciting experiences that are outside of the box.” With a clear roadmap that includes expansion into body care and makeup, Rhode has proven itself capable of thriving beyond celebrity appeal, becoming a model for modern beauty brand growth.
Implications for the Future of Beauty M&A
Rhode’s billion-dollar acquisition comes at a time when beauty industry mergers have slowed due to global economic uncertainty, inflation, and cautious investor sentiment. However, industry analysts say the deal signals renewed appetite for strategic investments, particularly in brands that combine cultural resonance with operational rigor. “What gave us the conviction is Hailey’s and Rhode’s track record. She’s a disruptor like us,” said Elf CEO Amin, who plans to scale Rhode globally, beginning with markets such as Brazil.
Rhode’s story also marks a shift in expectations for celebrity-founded brands. The days of passive endorsements are fading, with Hailey Bieber exemplifying a hands-on approach to brand building. Lauren Ratner, Rhode’s co-founder and president, echoed this sentiment, emphasizing the role of genuine leadership and innovation in Rhode’s ascent. As the industry recalibrates, Rhode’s success may pave the way for similar high-profile deals involving other prominent beauty brands like Rare Beauty or Glossier, all striving to prove that celebrity-driven doesn’t have to mean superficial.
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