Founder of skincare brand Drunk Elephant made a fortune by selling the venture for USD 845 Million
Drunk Elephant, founded in 2012 was a result of Tiffany Masterson’s passion for ingredients and the effects that have on individual’s skin and health. Initially, the company had two seed investors.
Success mantra behind Drunk Elephant products was not mainly because of its key ingredients but by and large because of what is not in them. In the early stages, along with a contract chemist, Tiffany only developed serums and creams. They refrained from dubious ingredients like essential oils, drying alcohols, silicones, chemical sunscreens, sodium lauryl sulphate, dyes and fragrances. They flagged the aforementioned as the ‘Suspicious Six’ which caused long term bad effects on an individual’s skin. Gradually, they increased their product line refraining from the dubious six.
She launched the official Drunk Elephant website in 2013 with an aim to partner with Sephora — a French beauty retailer with presence across major countries. By 2015, Drunk Elephant products were launched on Sephora under NON TOXIC Category. In no time, Drunk Elephant was one of the top selling brands at Sephora.
In 2017, the venture received funding from San Francisco based private equity firm VMG in exchange for a minor stake in the company. Leandra Medine, a fashion and lifestyle blogger also invested in the company. These investments helped bring people on board and further the company’s vision to expand its footprint locally and globally.
It was only in October 2019, Shiseido — a Japanese listed MNC, a forerunner in various personal care products, acquired 100% of Drunk Elephant for USD 845 million (approx. 8.5x’s 2019 sales — USD 100 million). This acquisition was part of Shiesido’s strategy to expand globally.
Innovating a product from scratch and staying true to their roots and away from the dubious ingredients was Tiffany and Drunk Elephant’s mantra to success. All of this while keeping their pricing similar to major brands. Within a short span, Drunk Elephant became a cultural phenomenon and kept increasing their market share which ultimately led to their acquisition by the Japanese conglomerate. As per Forbes, Tiffany Masterson swiftly took home USD 120 million by selling her stake to Shiesido.
