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When coronavirus first hit, beauty investors sheltered in place and routed efforts toward their existing portfolio companies to make sure that those brands could weather the storm. But now that reopening has begun and private equity executives are emerging into a changed world—one that has undergone several months of a pandemic and the global swell of the Black Lives Matter movement—their perspectives on beauty deals have, at least somewhat, been altered.
The fundamentals remain the same: Investors want growing businesses in attractive categories with good management teams and solid brand DNA. But other aspects—like profitability and a strong direct-to-consumer connection—have taken on even more importance, sources said. Diversity, too, has become a priority for leaders as they assemble boards and pick the companies they invest in, with several sources saying they will consciously work to invest in black-owned businesses and hire black executives