A Reality Check for Beauty Startups

Beauty startup investors began this year with high hopes. In December, personal care giant Unilever said it was buying hair care brand K18, a star on TikTok since its 2020 launch. The industry took that as a sign that trendy brands had a fresh shot at selling to big conglomerates, which had mostly paused acquisitions after a deal binge in 2021.

At least five beauty startups have hired advisers to explore a sale since the start of the year, four bankers working with sellers told me. But the big buyers have mostly remained cautious, especially regarding young brands without long track records. That has left investors, founders and bankers who gathered at a beauty industry deal conference in New York this week anxious for more deals to materialize.