Oddity Shares Surge 35 Percent in Its Stock Market Debut
In a sign that the IPO market could be warming up, Oddity, the parent company of Il Makiage and SpoiledChild, has gone public, with investors diving into the stock.
Shares in the company, which is trading on the Nasdaq Global Market under the ticker “ODD,” closed up 35 percent, or $12.53, to $47.54, valuing the company at about $2.7 billion.
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On Tuesday Oddity revealed that it had priced its IPO at $35 a share, above expectations. Originally it had targeted ranges of $27 to $30 and on Monday said it was targeting $32 to $35.
In an interview, the company’s global chief financial officer Lindsay Drucker Mann put its success down to its digital prowess.
“We’ve unlocked online,” she said. “You have incumbents that are mega cap businesses. They’ve created unbelievable value over time. But we believe that the consumer has moved forward and we have the playbook of technology and talent to really build that future.”
“Having the full strength of deep liquid capital markets behind us is like an amazing engine,” she continued. “Business has never been stronger. We’re firing on all cylinders.”
Founders, brother and sister Oran Holtzman and Shiran Holtzman-Erel, relaunched cosmetics brand Il Makiage in 2018 after receiving a $29 million investment from L Catterton, which bought a 35.8 percent stake in the business in 2017. Oddity launched its second brand SpoiledChild in February 2022, with 17 refillable stock keeping units across hair care and skin care, priced from $45 to $95.
Most recently, Oddity acquired Boston-based biotechnology start-up Revela for $76 million. With the acquisition and an additional $25 million investment, the company plans to establish Oddity Labs in Boston. The move marked the company’s third acquisition since its inception in 2018. It also bought Voyage81, a hyper-spectral imaging software company, in 2021 for more than $40 million, and NeoWize, a data science start-up based in Israel, in 2019 for an undisclosed amount.
The company’s net revenue came in at $324.5 million during 2022. This was up from $222.6 million and $110.6 million for 2021 and 2020, respectively. Net income was $21.7 million in 2022, compared to $13.9 million and $11.7 million for 2021 and 2020, respectively.
SpoiledChild, launched last year, generated $25.9 million of net revenues during 2022, scaling faster than Il Makiage.
“We have built really amazing differentiated brands that have a strong point of view,” continued Drucker Mann. “We don’t launch a product unless it’s a top-performing product formulation in the category because without super high-quality product, our business model wouldn’t work. We have to have strong repeat in order to make the economics work. We have this very powerful commitment to building great brands and delivering amazing product, but at the same time, you need the data, you need the technology and you need the AI engines in order to actually unlock online for the user in a way that makes it easy for her to shop and find what she wants.”
Goldman Sachs, Morgan Stanley, and Allen & Company acted as lead book-running managers for the IPO.
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