Jessica Alba’s Honest Company Notches $412.8 Million IPO

Honest Company, the consumer goods company launched by actress Jessica Alba, raised $412.8 million in an initial public offering (IPO) at a $1.44 billion valuation, CNBC reported on Wednesday (May 5). The Los Angeles-based company plans to list its shares on Nasdaq under the ticker symbol HNST.

The startup, which specializes in eco-friendly consumer goods, said it sold 25.8 million shares at $16 each. The company is backed by Lightspeed, Fidelity and General Catalyst and sells all kinds of merchandise from diapers and nursing pillows to vitamins and non-toxic household products. The company sells products through its website, Honest.com, and in brick-and-mortar stores via partnerships with retailers such as Target and Costco.

Honest Company offered 6.5 million shares of common stock and stockholders named in the prospectus are offering 19.4 million shares of common stock. Morgan Stanley, Jefferies and J.P. Morgan are among the lead underwriters for the offering.

The baby and beauty products company founded by Alba said in a filing last month that it expected to price its IPO at between $14 and $17 and raise as much as $504.5 million. Based on its outstanding share count following the offering, it could have a valuation of around $1.4 billion.

Honest Company said last month that it was looking to list on Nasdaq at a value of $100 million. Per the filing, the company saw gross margin in 2020, according to the filing, was 35.9 percent in 2020, up 3.7 percent from 2019. The Honest Company reported a net loss in 2020 of $14.5 million.

The consumer packaged goods (CPG) ecosystem had a great year in the midst of the COVID-19 pandemic, with increases in consumption of toilet paper, paper towels, cleaning supplies, canned goods, laundry detergent and snack foods. The company pointed to its strong in-house research and development as being a benefit. The company said in the filing that it plans to “increase sales through eCommerce channels.