# Hailey Bieber and Rhode Founders Navigate Strategic Acquisition by e.l.f. Beauty Rhode founders secured creative autonomy and operational control during their $1 billion acquisition deal. - **Source:** [Fortune](https://fortune.com) - **Published:** 2026-10-14 - **Topic:** [Business](https://brifing.si/c/business) - **Original article:** - **On Brifing:** https://brifing.si/s/df313e9a-449e-4026-a0c7-0a67cd7e7080 ## Strategic Acquisition Concerns Hailey Bieber and cofounder Lauren Ratner approached the Rhode acquisition with significant caution, prioritizing brand integrity over valuation. Having heard cautionary tales from other founders about losing creative control, Bieber explicitly negotiated to maintain her leadership role. She feared that a larger parent company would dilute the brand's unique identity and decision-making authority. ## E.l.f. Beauty's Integration Strategy E.l.f. Beauty successfully addressed founder concerns by promising to supercharge the back end while leaving creative operations untouched. The acquirer explicitly stated they would not fix what was not broken, allowing the Rhode team to continue their established processes. This commitment to autonomy was a decisive factor in finalizing the deal. ## Operational Autonomy Post-Deal More than a year after the acquisition, Bieber confirms that e.l.f. has honored its promises regarding operational independence. She retains control over all major decisions, including creative direction and product innovation. Her role has actually expanded, as she now serves as a strategic advisor to e.l.f. Beauty, influencing the parent company's broader product portfolio. ## Scaling Through Infrastructure The decision to sell was driven by the need for robust infrastructure to support global expansion. While Rhode operated as a lean, nimble team, the founders recognized they had reached their operational limits. Partnering with e.l.f. provided the necessary resources to scale effectively, particularly as the brand prepared for major international retail launches. ## Retail Expansion Milestones Rhode has successfully leveraged its new partnership to expand its retail footprint significantly. After entering Sephora in the U.S. last September, the brand has become the top performer in its categories across U.S., U.K., and Australian markets. Recent expansion into 19 European markets further demonstrates the effectiveness of this new corporate structure. ## Record-Breaking Sales Performance The brand's growth trajectory remains aggressive, with net sales reaching approximately $390 million in fiscal 2026, marking an 80% year-over-year increase. The debut in the European Sephora market was particularly notable, with first-day online sales surpassing the previous year's total Black Friday performance for the entire region, validating the strategic move to scale. ## Founder-Led Innovation Model Bieber and Ratner continue to lead Rhode from the ground up, maintaining the same intensity they had since the brand's 2022 launch. By keeping the original team in place, they ensure that the secret sauce behind their initial success remains intact. This model challenges traditional acquisition narratives where founders typically exit post-transaction. ## Future Growth Trajectory With the backing of e.l.f. Beauty, Rhode is now aiming to surpass the $1 billion mark in total valuation. The synergy between the founders' creative vision and the parent company's operational scale appears to be a winning formula. The focus remains on maintaining high-quality product development while navigating complex global retail environments. ## Sources covering this story - https://fortune.com/2026/10/14/hailey-bieber-sold-rhode-e-l-f-beauty-after-she-and-co-founder-lauren-ratner-addressed-their-main-fear-in-an-acquisition/ — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._