Coty Snags Stake In Peer-To-Peer Platform Younique

Global beauty products company Coty is entering into a partnership with online P2P social commerce platform Younique. Coty is slated to put up $600 million in cash for 60 percent ownership of the platform.

The partial purchase is seen as the latest consumer products deal for scooping up an online startup, which will allow for a direct-to-consumer element and will circumvent brick-and-mortar shops, such as Sephora and Ulta Beauty.

Indeed, as previously reported by PYMNTS, the beauty industry has become ruled by millennials, women between the ages of 18 and 34 being the main buyers, according to a survey by TABS Analytics. Spending nearly $13 billion in the cosmetics industry, these shoppers do their research predominantly online and then take that knowledge to the stores to make their purchases.

Younique, which was founded in 2012 by two siblings — current CEO Derek Maxfield and Chief Visionary Officer Melanie Huscroft — will maintain 40 percent ownership of the platform and continue to lead the business under the new partnership. The company, which has a mission of helping those who were sexually abused, sells a variety of makeup offerings, including $19 lipsticks and $39 creams, with the help of social media. According to a release, the platform will continue to focus on its mission “to uplift, empower and validate women across the globe.” The company’s makeup and skin care products are purchased through its unique peer-to-peer eCommerce platform, which allows for leveraging social media and a direct-to-consumer channel.

Coty, one of the largest global beauty companies, has about $9 billion in revenue and is affiliated with COVERGIRL, Max Factor and Rimmel. The company also has product lines connected to salons and beauty professionals.

Analysts see Coty’s interest in Younique as a scalable, high-growth eCommerce platform and technology model, with 200,000 “active presenters” and more than 4.1 million customers across 10 countries. According to the release, Younique anticipates generating more than $400 million in net revenues for 2016.

The partnership is slated to escalate the number of product offerings on the site, as well as expand the geographical nature of the site’s audience.

Of course, the partnership and the transaction that goes along with it are subject to closing conditions, but it is anticipated to occur during Coty’s fiscal third quarter.


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