Breaking news: E.l.f. Beauty just acquired Hailey Bieber’s skincare brand Rhode in a $1 billion deal.

Rhode, launched just two years ago, generated $212 million in net sales in the 12 months ending March 31 — all via DTC. With plans to launch in Sephora later this year, it’s now stepping into retail with momentum and valuation on its side.

Here’s the structure of the deal:

  • $600M in cash
  • $200M in e.l.f. common stock
  • $200M earnout based on performance over 3 years
  • Hailey will remain Rhode’s Chief Creative Officer and Head of Innovation — and serve as a Strategic Advisor to the combined companies.

So what actually made Rhode a billion-dollar brand? Let’s get into it.

Step 1: Build a Brand World — Not Just a Product Line

Rhode’s identity is clear: cool, clinical, and minimalist — from the packaging to the photoshoots to the website. Everything feels part of a tightly edited mood board.

Founder Takeaway:

  • Your brand should feel like a world people want to live in.
  • Every detail (font, finish, formula, feed) should support that vision.

Ask yourself: Could someone recognize your brand with the logo removed?

Step 2: Start Small. Launch Big.

Rhode didn’t debut with 10+ SKUs. It launched with three, each with strong positioning and hype: the Peptide Glazing Fluid became a hero product almost instantly. Scarcity drove desire.

Founder Takeaway:

  • You don’t need a full shelf — you need a product people talk about.
  • Build buzz around fewer SKUs, and make each launch feel like an event.

Strategy Tip: Limited drops → build urgency. Replenishment delays → build demand.

Step 3: Leverage Attention. Deliver Performance.

Yes, Hailey Bieber brought built-in virality. But Rhode didn’t just ride her name — it delivered formulas that beauty insiders and everyday consumers actually loved. TikTok loved it, and editorial did too.

Founder Takeaway:

  • Celebrity can open doors. Performance keeps them open.
  • Focus on formulation and user experience from day one.

Don’t have a celebrity cofounder? Then make your customer your influencer.

Step 4: Own DTC Before You Touch Retail

Rhode stayed DTC-exclusive for its first two years — allowing it to gather direct customer data, refine its ops, and build a tight-knit community.

Now, it enters Sephora from a position of strength — not desperation.

Founder Takeaway:

  • DTC is your lab. Use it to test, learn, and grow on your terms.
  • When you do go wholesale, you’ll do it with leverage.

Get your backend ready: Inventory planning, retention strategy, and solid CX before scale.

Step 5: Sell the Lifestyle, Not Just the Product

Rhode doesn’t just sell skincare — it sells a vibe. The brand sits at the intersection of wellness, beauty, and fashion. It feels aspirational, but attainable.

Founder Takeaway:

  • Your brand isn’t what you say it is — it’s what your customer feels it is.

Create content that’s not just about selling — but about belonging.

Your Founder To-Do List

  • Audit your brand world. Does every touchpoint align?
  • Identify your hero product. Build your launch strategy around it.
  • Invest in a waitlist or pre-order moment to build early demand.
  • Focus your resources on standout performance — not chasing trends.
  • Use DTC to refine your offer before going wholesale.
  • Show up like a lifestyle brand — not just a product page.

Why This Matters for the Industry

This deal cements Rhode as a new-era beauty powerhouse and signals that strategic, brand-first DTC businesses can reach billion-dollar valuations — even in a crowded market.

It also underscores E.l.f.’s savvy in acquiring culture-shifting brands that connect with the next generation of consumers.

Founders, take notes.

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