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  • Writer's pictureMatthew Mancini

Jessica Alba’s Honest Co. Preparing to Go Public

Updated: Feb 25, 2021

Actress and founder of Honest Co. Jessica Alba with an array of products from her company (Source: USA Today)

January 31st, 2021

Honest Co., which sells baby and beauty products, was founded by actress Jessica Alba in 2012. The company is thinking about filing for an Initial Public Offering (IPO) with the Securities and Exchange Commission (SEC) as early as Friday.

The company was considering one back in 2016 working with Morgan Stanley and Goldman Sachs. They decided to not go forward with it after questions were raised over its labeling practices. The New York Times reported last fall that the company was up for sale and valued at a little over $1 billion.

Currently, Honest Co. was able to bounce back and now seeks a valuation of $2 billion for the IPO, according to Bloomberg News. They are rumored to be interviewing bankers to facilitate the offering.

The company has seen a huge growth in a short period with 32,000 locations, including 3,000 worldwide, and $350m in sales.

They also have a significant amount of brand loyalty due to their strong commitment to integrity, honesty, and an early developer in “clean” cosmetics. They’ve secured a foothold in the younger consumer base, which is something that their main competitor, Procter & Gamble Co. (PG: NYSE), hasn’t been able to do.

Honest Co. has put more investments into R&D, expanded their laboratories, and opened fulfillment centers, which allows them to have more control over production and ensure only approved ingredients are placed into their products as well as improve quality standards.

Considering Google searches for “sensitive skincare” has doubled in the past five years, people are increasing their need for cosmetics that are healthy for their skin. Honest Co. recognized this need and launched a fragrance-free, dermatologist approved, vegan daily skincare routine that is perfect for those with sensitive skin.

They’ve also begun using reusable, refillable, and recyclable materials which emphasize their message of an environmentally friendly company.

The natural diaper industry is growing, and Honest Co. is at the forefront as the number one retailer and sells 50% of all-natural diapers in the marketplace. On top of that, the company plans to launch “a new diaper with advanced absorbency technology, designed with sustainably harvested, chlorine-free fluff pulp, which means reduced toxins in the waterways”, according to IPO Edge.

Jessica Alba has played a huge part in the company since she founded it with business partners Brian Lee, Sean Kane, and Christopher Gavigan. She founded The Honest Company with the ideals of selling nontoxic, effective, beautiful, and affordable products.


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