- Honest Company, Jessica Alba’s consumer goods startup, filed for an IPO on Friday.
- It generated $300.5 million in revenue last year, with diapers and wipes driving 63% of sales.
- The company, which has never been profitable, plans to trade on the Nasdaq under the symbol “HNST.”
- See more stories on Insider’s business page.
Jessica Alba’s consumer goods startup Honest Company is going public.
The company filed for an IPO on Friday with plans to sell shares on the Nasdaq under the symbol “HNST.” It listed a placeholder IPO value of $100 million.
Diapers and wipes accounted for 63% of the company’s $300.5 million in revenue last year. Skin, personal care, household, and wellness items made up the rest of its sales.
While the company’s 2020 revenue grew about 28% from the previous year, it reported a net loss of $14.5 million. It has never been profitable on an annual basis since its founding in 2012.
“We have incurred net losses each year since our inception and we may not be able to achieve or maintain profitability in the future,” the company wrote in the risk factors section of its S-1.
Honest Company’s 2020 growth was driven in part by a bump in digital sales, which represented 55% of its revenue last year. Digitally-native brands like Honest, which sells products on Honest.com and digital retailers like Amazon, benefited from a overall shift to ecommerce last year as brick-and-mortar stores shut down during the coronavirus pandemic. US e-commerce sales rose 32.4% in 2020 to $791.7 billion, according to the US Census Bureau.
“We see consumers increasingly self-educating on the benefits of clean and natural products through social media, influencers and other online content, driving digital engagement and purchasing that supports continued outsized growth of the ecommerce channel,” the company wrote in its prospectus.
Alba started Honest Company with a mission to make consumer products that the actress deemed “clean,” excluding chemicals and materials like parabens and sulfates. The brand’s approach to labeling its products has led to trouble in the past. In 2017, the company settled a lawsuit that claimed it fraudulently labeled some of its products as “natural,” “plant-based,” or “no harsh chemicals (ever!).”
“Health and safety incidents or advertising inaccuracies or product mislabeling may have an adverse effect on our business by exposing us to lawsuits, product recalls or regulatory enforcement actions,” the company wrote in its risk factors section.