Oddity Tech’s public boost paves path for future development

Oddity Tech, the beauty and wellness company, will ride the recently-cracked public markets to accelerate its beauty brand roadmap.

Driving the news: The New York-based company made its public debut Wednesday, seeing shares increase 35% to $47.53 a piece at close — above the $35 per share IPO price it set the day before.

• This placed its valuation at around $2.7 billion.
• The company and its shareholders, including private-equity firm L Catterton, raised about $424 million.

What’s next: The direct-to-consumer company will use the proceeds from the IPO to invest in its existing brands, and launch new brands, new product categories and in new markets.

• Oddity is currently developing ‘brand three’ and ‘brand four,’ CFO Lindsay Drucker Mann told Axios on Wednesday.
• The company has a New Ventures brand incubator, which uses the company’s data and tech platform to find attractive areas of demand in the global beauty and wellness market and “go after them,” she adds.
• Oddity will consider opportunities to bring third-party brands onto its platform, but the hurdle is very high, she says.

Context: Beauty companies are increasingly bringing the innovation and development of new brands in house, spurring a wave of M&A in beauty manufacturing.

Catch up fast: Oddity, which is behind makeup brands Il Makiage and SpoiledChild, acquired AI-based biotech startup Revela for more than $100 million earlier this year.

• Oddity plans to use the U.S.-based lab to help it bring new green innovations, molecule discovery and develop products for existing and future lines, Drucker Mann says.

• The lab uses artificial intelligence to discover brand new molecules, a method commonly seen in the pharmaceutical industry to develop new drugs.

What they’re saying: “Our mandate is to deliver newness to the customer and find the next best brand or opportunity,” Drucker Mann says, adding the company has had a great track record of developing in-house brands.

Of note: Drucker Mann joined Oddity in 2021 from Goldman Sachs, where she headed the bank’s consumer and consumer-tech equity capital markets.

By the numbers: Last year, Oddity’s profit was $21.7 million and sales reached $324.5 million.

• In the quarter ended March 31, Oddity generated $165.7 million in revenue on profit of $19.6 million.