Beautycounter sold back to its founder amid beauty industry headwinds

The Carlyle Group is selling DTC clean beauty brand Beautycounter back to its founder Gregg Renfrew, a Carlyle spokesperson confirmed to Ad Age. Sources familiar with the matter indicated that there had been layoffs, but did not confirm their scope. The transaction comes amid growing signs of a slowdown in the beauty industry. “Over the last three years, Beautycounter experienced significant market and channel headwinds. We undertook every effort to support the brand, including by increasing marketing spend, driving innovation to broaden the product portfolio, and enhancing the omnichannel strategy—and investing additional capital into the business to support these initiatives along the way,” a Carlyle spokesperson told Ad Age. “However, the business continued to lose ground. With the backdrop of significant near-term capital needs, we determined that exiting the business through a sale back to Gregg was in the best interest of all parties and ensured business continuity. We look forward to following Beautycounter’s next chapter and wish every success to Gregg and her team.” Renfrew did not immediately respond to Ad Age’s request for comment. Sign up for Ad Age newsletters From influencer marketing to agencies, get the latest news and analysis delivered to your inbox Click here The Carlyle Group, a private equity firm that touts $426 billion in assets under management across three business segments, owns numerous companies in various sectors, including men’s bath and soap brand Every Man Jack. Beautycounter has experienced multiple corporate shakeups over the past few years. Renfrew sold the company to Carlyle in 2021 and was asked to step down as CEO a few months later. But by January 2024, she had returned as Beautycounter’s CEO. Read more DTC industry news from Ad Age The news comes just a few weeks after Ulta Beauty CEO Dave Kimball warned analysts at a J.P. Morgan conference of a beauty category slowdown across price points and segments. Founded by Renfrew in 2011 and launched in 2013, Beautycounter has a long history of marketing itself as “clean beauty,” a nebulous term that refers to beauty products that contain less harmful ingredients than others. Beautycounter, however, seems to have some weight behind its label: It’s on Ulta’s list of “Conscious Beauty” brands (Ulta’s classification for companies that Ulta says are cruelty-free, are vegan, or are sustainably-packaged), and is both B Corp and Leaping Bunny certified. As of 2023, over 65% of overall consumers sought clean ingredients in their purchases, according to Circana data cited by Retail Dive. Just last month, Beautycounter announced that it was entering the fragrance space. The launch of the Clean Eau De Parfum collection was focused on closing the “fragrance loophole,” which the company described as “a legal provision dating back to the 1970s that allows companies to legally hide dozens to hundreds of ingredients used to make a scent under generic listings,” such as “fragrance” or “parfum.” The brand hoped to close the fragrance loophole through ingredient transparency, safety screening, and third-party validation from organizations including Leaping Bunny. It also planned on making a trip to Washington with its “community” to lobby Congress about closing the fragrance loophole. Subscribe to Ad Age Sign up now for the latest industry news and analysis Click here

Beautycounter sold back to its founder amid beauty industry headwinds

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