Jessica Alba startup may head to IPO

The Honest Co. is worth nearly $1 billion, and just raised $70 million from investing partners.

By MSN Money Partner Aug 27, 2014 2:15PM
By Laura Lorenzetti, Fortune

Jessica Alba's start-up The Honest Co. has raised $70 million, making the company worth almost $1 billion as it looks toward an initial public offering.

The eco-friendly baby product company launched two years ago and annual revenue is expected to be over $150 million this year, three times its 2013 sales, reported The Wall Street Journal. About 80 percent of its revenue comes from its subscription service that sends moms monthly deliveries of diapers and other non-toxic baby products.

Wellington Management Company led the Series C funding round, which included a handful of unnamed public financial companies and existing venture investors such as Lightspeed Venture Partners and Iconiq Capital.

As Honest Co. works toward an IPO, Wellington has the capacity to guide the company and provide insight on the metrics and traction needed to go public.Credit: © BDG/REX
Caption: Jessica Alba at the 2014 MTV Movie Awards

Alba (pictured), who was named one of Fortune's Most Powerful Women Entrepreneurs in 2012, co-founded the company in 2011 with the intention of blending good-for-you products with a feel-good social mission. The Honest Co. donates diapers and cribs as part of its business model, similar to the "buy one, donate one" model of startups like Warby Parker and Toms Shoes.

Honest Co. products are sold at outlets like Whole Foods (WFM), Costco (COST), Target (TGT) and Nordstrom (JWN), though only 20 percent of its items are sold offline. The company has been at capacity fulfilling orders, CEO and co-founder Brian Lee told The Journal.

The company plans to use the new funds to grow its reach in the U.S. and abroad. It is currently in talks to expand to China, according to a report by Dow Jones VentureWire.

Honest Co. previously raised $52 million, including a $25 million funding round in November.

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Tags: COST


Aug 30, 2014 2:47PM
Great to see young minds rather than dirty mouth rappers and dope dealers.... Someone who can build up not trash and destroy.
Aug 28, 2014 12:37AM
Anyone doing business with China must be aware they are doing business with a dictatorship that violates human rights on a mass scale and is committing ethnic genocide in Tibet.  From jailing human rights advocates to denying any rights to speech or religion, this is a fascist regime.  Why fascist?  Fascism is the unity of corporate power with state power fully.  And the Chinese "corporation" is a state creation, protected by the state.  She should reconsider just how much she needs the money as should ALL corporations, and know that doing business with a fascist state makes them supporters of a criminal government.  If these people could support divesting in South Africa, they should morally DIVEST, not invest, in China.  Are they the new Swiss, who helped Nazis launder concentration camp gold?  Do they think doing business with Nazi Germany while trying to project themselves as clean is a good thing?  
Aug 30, 2014 10:30AM
Aug 30, 2014 8:41PM
She isn't just a pretty face. Good for her. I wish her great success.
Aug 30, 2014 10:52PM

Reusable cloth diapers, baby powder and baby oil worked

just fine on our two children without "investing" money in

some Initial Public Offering (IPO).

Would suggest some families save their money and invest

it in themselves instead of making Wall Street tycoon

or robber baron richer!

Aug 30, 2014 11:18AM
Although I like the company, take a look at the numbers. Honest has done 60 million the first year and is expected to do 150 million this year, at best they are only worth around 250 million (as the sharks) they have raised 25 million, 70 million and 25 million all of which has to be repaid with a profit. Just because you raise money for your company doesn't make it a Billion dollar company just to take public. This is the problem with the industry now. Someone says, this business is worth a billion and people believe and buy stock at an initial offering and then reality sets in and the stock drops and the people that bought this so called billion dollar company finally realize its only worth 250 million. (Remember Facebook)  The Honest company its so honest anymore
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