In Brands, Exclusives, Finance

Founded in 2004 by father and son duo Alan and Joey Shamah, e.l.f. Beauty was launched with the primary focus on selling quality cosmetics online at the $1, $3, and $5 price points. Over the course of 12 years this combination captured the attention of both millennial shoppers, large mass retailers and eventually the investment community. “e.l.f. Beauty’s cosmetics were always focused on diverse consumers and millennials long before it was fashionable to do so,” Chief Executive Tarang Amin told Fortune. “We don’t believe women should have to pay high for luxurious beauty products. And we believe in serving all women.”

THE RECIPE FOR SUCCESS

  • Clear articulation of the white space for quality cosmetics under $5.
  • A robust direct-to-consumer business built through a branded website and nine retail stores.
  • Connectivity to the consumer. They listen to what people want and consumers rave about the brand and quality of the products.
  • Deep focus on building a community through social media and with professional and celebrity makeup artists, not big-budget ad campaigns or celebrity endorsements.

THE TIMELINE

  • 2016:  The company reports $1.1 million of net income on $97 million in revenue for the first half of 2016, compared to $2.7 million of net income on $75 million of revenue for the year-earlier period. National and international retailers (19,000) represent 87% of e.l.f.’s total sales last year, with 13% coming from the brand’s website and stores.
  • 2014: e.l.f. Beauty was acquired by TPG Growth for between $200 million and $300 million.
  • 2011: Raised an undisclosed amount of financing from consumer-focused private equity firm TSG Consumer Partners. Terms of the deal were not released, but the company said that TSG took a minority stake

THE IPO

  • The Company  filed an S-1 with the U.S. Securities and Exchange Commission to list its shares on the public markets.
  • e.l.f. Beauty started trading on NYSE on Thursday (September 22, 2016) under the symbol (ELF).
  • The initial public offering price was $15.00 per share.
  • Shares exploded about 41% on their first day of trading.
  • e.l.f. Beauty raised $141 million by selling 8.3 million shares above the expected 14-16 range.
  • The stock closed at $26.50 on the first day of trading, valuing the company at $1.18 billion.
  • According to WSJ,  e.l.f. Beauty received $63.2 million in proceeds before expenses, according to the company, while its selling shareholders received $68.5 millions.
  • Proceeds from its IPO are said to be used to pay down its roughly $204 million of debt and for general corporate purposes.
  • JPMorgan Chase & Co, Morgan Stanley, Piper Jaffray Companies, and Wells Fargo & Co are the joint bookrunners for the offering.

 

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