While the future is bright for beauty and wellness, the sector is not immune to economic and investment trends. 2024 ended just as it began—with anticipation. There was a lot of buzz about some very sizable brands coming to market that never quite got to the altar. There is currently a sizable pool of beauty brands with investors that are ready to exit, and ultimately, they need to find a new home. The supply and demand bottleneck needs to shake out to assure investors that the capital they are deploying is in brands that can exit or find a home. For the full year 2024, the BeautyMatter Deal Index tracked 297 deals, up 15.1% from 2023, when it tracked 258. The year started off strong in Q1, when deal activity was up 16.1%, but started to feel like a bit of a roller coaster by Q2, when activity fell 20.3%, and growth deals in particular bottomed out with the lowest number of deals in the history of the Index. Q2 saw just 16 growth deals, a far cry from the average of 43 per quarter over the last four years. But the back half of the year saw a recovery led by strong M&A activity. Q3 and Q4, combined, were up 34.3% and led to a strong finish for 2024. For the year, M&A comprised about 55% of deals, while growth represented 43%. The remaining 2% of deals were the six IPOs the Index tracked in 2024, the most since 2021.Like most consumer categories, beauty and wellness is powered from the top when it comes to deal activity. In the most simplistic of terms, strategics acquire from private equity. And private equity provides liquidity for venture and early-stage investors. The whole system helps fund growth, innovation, and exit opportunities for founders.