Rihanna is a billionaire. It’s not even a situation where she’s just technically a billionaire by the skin of her teeth either. Forbes just estimated Rihanna’s net worth at $1.7 billion, and having read their analysis, I kind of think they might be undervaluing her. It’s no surprise that the bulk of Rihanna’s wealth has not even come from music or the traditional avenues of celebrity (sponsorships, advertising contracts). No, Rihanna has started her own successful businesses and she completely shook a staid, racist cosmetic industry to its very core. Fenty Beauty is the biggest reason why Rihanna is so rich, but she’s also made some really smart decisions for collaborators, advertising and more. You can read the full Forbes piece here. Some highlights:
Fenty Beauty changed everything: Rihanna is now worth $1.7 billion, Forbes estimates—making her the wealthiest female musician in the world and second only to Oprah Winfrey as the richest female entertainer. But it’s not her music that’s made her so wealthy. The bulk of her fortune (an estimated $1.4 billion) comes from the value of Fenty Beauty, of which Forbes can now confirm she owns 50%. Much of the rest lies in her stake in her lingerie company, Savage x Fenty, worth an estimated $270 million, and her earnings from her career as a chart-topping musician and actress.
Why Fenty Beauty has been so successful: The label is a 50-50 joint venture with French luxury goods conglomerate LVMH (run by Bernard Arnault, the world’s second richest person), launched in 2017 with the goal of inclusivity. Its products come in a diverse range of colors—foundation is offered in 50 shades, including harder-to-find darker shades for women of color—and are modeled in its advertising by an equally diverse group of people. Available online and at Sephora stores, which are also owned by LVMH, the products were an instant success. By 2018, its first full calendar year, the line was bringing in more than $550 million in annual revenues, according to LVMH, beating out other celebrity-founded brands like Kylie Jenner’s Kylie Cosmetics, Kim Kardashian West’s KKW Beauty and Jessica Alba’s Honest Company.
Everyone wants to invest in beauty: While cosmetics sales slowed during the pandemic, beauty companies are worth as much as ever. Stocks of larger beauty conglomerates like Estee Lauder and L’Oreal have bounced back, reaching all-time highs and trading at impressive 7.5 (or more) times annual revenues. Meanwhile independent brands like Beautycounter and Charlotte Tilbury inked deals with investment firms earlier this year at billion-dollar valuations. That is good news for Rihanna. Thanks to the impressive multiples at which beauty companies are trading, Fenty Beauty is worth a conservative $2.8 billion, Forbes estimates. And all signs point to the company continuing to grow. In its annual report for 2020, LVMH said Fenty Skin, which launched last year, was off to a “very promising start” and “generated unprecedented buzz,” and that Fenty Beauty “maintained its appeal as a premier make up brand.”
More on Savage X Fenty: In February her lingerie line Savage x Fenty raised $115 million in funding at a $1 billion valuation. The company, which launched in 2018 as a joint venture with TechStyle Fashion Group, counts blue-chip investors like Jay-Z’s Marcy Venture Partners and private equity firm L. Catterton (in which Bernard Arnault is an investor) as shareholders. Rihanna maintains a 30% ownership stake, Forbes estimates. The latest round of funding will reportedly be used for customer acquisition and retail expansion.
Forbes also confirms that Rihanna did have one failure: her accessories brand, which had the Fenty name too. Apparently, she’s already shut it down after sales steeply declined during the pandemic. It’s fine, not everything has to be a hit! Especially not when you’ve created one billion-dollar brand and a second brand is headed that way. I figured Fenty Beauty would be successful when she launched it, but I had no idea it would be this successful, nor did I have any idea how the old companies (Estee Lauder, L’Oreal) would be so freaked out by Rihanna’s success in exploiting an untapped consumer market of “people who do not have fair skin.” As for her lingerie line… I’ve looked at that stuff and while I respect that Rihanna is offering consumers a different look and tapping into another untapped market, I actually do not like a lot of the lingerie! But whatever, if it sells, it sells. And it’s selling.
Photos courtesy of Backgrid.
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