“It’s an interesting time in the market right now,” said Vennette Ho, managing director and head of beauty, personal care and wellness at Raymond James, who believes reports of beauty M&A’s death are greatly exaggerated. “There’s been a lot of expectation, for sure, and this is a very uncertain time. One of the hardest things for M&A and in the transactions is uncertainty. They really get nervous. They get ‘risk off,’ is the term that people use. But at the end of the day, this is an industry that really thrives on M&A.

“It’s a time of real opportunity for M&A for those who are ready to lean in and really make a move during a time of uncertainty,” she continued. “So there will be deals that will happen.”

Those, however, will be fewer and of a different ilk than in the past. “A time of uncertainty is a time of opportunity,” Ho said.

Robin Tsai, general partner at VMG Partners, called getting deals done in any environment “mini miracles,’ because so many things actually have to go right. You have to have an incredible brand, great business model, the right team — and then you have to have the right timing, too. There is a luck component, as well.”

He deems valuations to be business-specific. “If you have an incredible and special business that is differentiated, that fits somebody’s need, you can get a robust result,” Tsai said. “The bar is a bit more complicated right now, but I don’t think it’s completely shut.”

“Great assets will always command great prices,” agreed Michel Brousset, founder and chief executive officer of Waldencast, who with Ho and Tsai were in discussion with Kathryn Hopkins, senior editor of beauty at WWD. “That said, in the current set of circumstances, for the next couple of years or so, there are more grade-A assets than there are buyers. That is a fact.”

Such phenomena tend to help lead to multiples contracting — at least temporarily.

“The world in which a lot of brands were built for exit is maybe a little bit over,” Brousset said. “The focus is to build great businesses that stand the test of time that are great businesses in themselves. And if there is M&A as a consequence of that — great. This idea of a pot of gold at the end of the rainbow coming from a big strategic will be true for some, but very few.”

Ho noted a lot of private equity action. “There’s more activity than you would think for strategics, because inherently, people need growth and need to stay relevant with the consumer,” she said. 

Echoing Tsai, Ho said the standard is high. “There are a lot of people looking,” Ho said. “But great deals are still possible.”

Tsai believe there’s going to be a good amount of activity with capital raises. “Because there is uncertainty, a lot of founders, operators look at their businesses and come to realize that — ‘hey — it might be a good time to actually have a little bit more cash on the balance sheet, because I don’t know what tomorrow looks like,’” he said.

Yesterday’s playbook of getting a business to a certain scale, with a certain distribution at a certain growth level can be good but that may not be necessarily enough nowadays.

“Today, people are looking for different things,” Tsai said. “It may be that you need to build a bigger business, that your business needs to look a little different than what you have today, in which case the timing of a liquidity event could get pushed out. So from a founder’s perspective, they might want to take some money off the table, too.”

Europe — less impacted by tariffs and other macro phenomena currently — has more of a buoyant M&A beauty market than the U.S. That’s spurred, as well, by buyers looking for brands that can resonate across the globe. “There will continue to be great deals done in Europe,” Tsai said. “Depending on the pocket that you’re looking at, there might be more there than there are here.”

“Every sector has its opportunities,” Ho said.

Speakers highlighted the resiliency of the beauty sector.

“This cohort of operators and founders are incredibly battle-tested,” Tsai said. “There were definitely dark moments, but people found a way and many came back stronger. This is another bump in the road.”