Hims & Hers Bought a Skincare Startup for $190 Million 4 Years Ago
In a surprising turn of events, Hims & Hers, the telehealth and wellness company known for its direct-to-consumer health products, has announced the shutdown of a skincare startup it acquired four years ago for a staggering $190 million. This decision has left many in the industry questioning the challenges of integrating startups into larger corporate structures and the evolving dynamics of the skincare market.
The Acquisition That Made Headlines
Back in 2020, Hims & Hers made waves in the wellness and skincare industries with its acquisition of a promising skincare startup. The $190 million deal was seen as a strategic move to expand the company’s portfolio beyond its core offerings of hair loss treatments, sexual health products, and mental health services. The startup, known for its innovative approach to personalized skincare, was expected to bolster Hims & Hers’ position in the booming beauty and self-care market.
At the time, the acquisition was hailed as a smart investment. The skincare industry was experiencing exponential growth, fueled by increasing consumer interest in clean beauty, personalized solutions, and at-home skincare routines. Hims & Hers aimed to leverage the startup’s technology and expertise to offer tailored skincare solutions to its growing customer base.
What Went Wrong?
Despite the initial optimism, the integration of the skincare startup into Hims & Hers’ ecosystem faced several challenges. Sources close to the matter suggest that the startup struggled to align with Hims & Hers’ broader business model and operational strategies. Additionally, the competitive skincare market, which is saturated with established brands and new entrants, may have made it difficult for the startup to gain a significant foothold.
Another factor that likely contributed to the shutdown is the shifting consumer preferences in the skincare industry. While personalized skincare remains popular, the market has become increasingly crowded, with companies offering similar products and services. This saturation may have diluted the startup’s unique value proposition, making it harder to stand out.
The Decision to Shut Down
In a statement, Hims & Hers explained that the decision to shut down the skincare startup was part of a broader strategy to focus on its core business areas. The company emphasized its commitment to providing affordable, accessible, and effective health and wellness solutions, particularly in areas like mental health, sexual health, and primary care.
“While we remain proud of the innovation and dedication that went into this venture, we believe it is in the best interest of our company to reallocate resources to areas where we can have the greatest impact,” the statement read.
Lessons Learned
The shutdown of the skincare startup serves as a cautionary tale for companies looking to expand through acquisitions. While mergers and acquisitions can offer exciting growth opportunities, they also come with significant risks. Cultural integration, market dynamics, and alignment with core business objectives are critical factors that can determine the success or failure of such ventures.
For Hims & Hers, the decision to shut down the startup may be a strategic move to streamline operations and focus on its strengths. However, it also highlights the challenges of navigating the highly competitive and ever-changing skincare industry.
What’s Next for Hims & Hers?
Despite this setback, Hims & Hers remains a major player in the telehealth and wellness space. The company continues to innovate and expand its offerings, with a strong focus on digital health solutions and personalized care. While the skincare startup may no longer be part of its portfolio, Hims & Hers is likely to explore new opportunities that align with its mission and long-term goals.
As the dust settles on this chapter, the industry will be watching closely to see how Hims & Hers adapts and evolves in the face of challenges. One thing is certain: in the fast-paced world of health and wellness, resilience and adaptability are key to staying ahead.
