May 23, 2022

How did Rihanna become a billionaire?

Rihanna |
Source : GettyImages

How did the singer become the richest musician on the planet? Hint: it’s not thanks to his concerts.

When Robyn Fenty, known to the world as Rihanna, launched Fenty Beauty in 2017, she set out to start a cosmetics business that would make “women (feel) included.” A perhaps unintended consequence: the beauty line has helped her enter one of the most exclusive ranks in the world, that of billionaire.
According to Forbes, Rihanna’s fortune now stands at $ 1.7 billion, making her the richest musician in the world and the second richest woman in the entertainment world after Oprah Winfrey. But it wasn’t her music that made her so rich. Most of his fortune (estimated at $ 1.4 billion) comes from the value of Fenty Beauty, of which Forbes can now confirm that she owns 50%. The rest of her fortune comes from her stake in her lingerie company, Savage x Fenty, which is estimated to be worth $ 270 million, and income from her career as a musician and actress.

If Barbados-born Rihanna isn’t the only celebrity leveraging her social media presence (she has 101 million Instagram followers and 102.5 million Twitter followers) to build a beauty brand. , she is the most successful entrepreneur in this field. Fenty Beauty, which is a 50-50 joint venture with French luxury goods conglomerate LVMH (led by Bernard Arnault, the second richest person in the world), was launched in 2017 with a focus on inclusiveness. Its products come in a diverse range of colors – the foundation comes in 50 shades, including darker shades harder to find for women of color – and is modeled in its ads by an equally group of people. diversified.
Available online and in Sephora stores, which are also owned by LVMH, the products saw immediate success. In 2018, its first full calendar year, the line grossed more than $ 550 million in annual revenue, according to LVMH, edging out other celebrity-founded brands like Kylie Cosmetics by Kylie Jenner, KKW Beauty by Kim Kardashian West and Honest Co. by Jessica Alba.

“A lot of women felt that there weren’t any lines on the market that catered to their skin tone. It was light, medium, medium dark, dark, ”says Shannon Coyne, co-founder of consumer products consultancy Bluestock Advisors. “We all know that’s not the reality. She was one of the first brands to come forward and say, “I want to speak to all these different people” ”.
As cosmetics sales slowed during the pandemic, beauty companies are worth more than ever. Shares of big beauty conglomerates like Estée Lauder and L’Oréal have rebounded, hitting all-time highs and trading at an impressive 7.5 times (or more) annual earnings. At the same time, independent brands like Beautycounter and Charlotte Tilbury struck deals with investment firms earlier this year for multibillion-dollar valuations.

This is good news for Rihanna. Thanks to the impressive multiples that beauty companies are trading at, Fenty Beauty is worth $ 2.8 billion, according to Forbes. And everything suggests that the company will continue to grow. In its annual report for 2020, LVMH said that Fenty Skin, which launched last year, has had a “very promising start” and “generated an unprecedented buzz”, and that Fenty Beauty “has maintained its appeal. as a leading makeup brand ”.
Fenty Beauty isn’t Rihanna’s only billion dollar brand. In February, her Savage x Fenty lingerie line raised $ 115 million in funding for a valuation of $ 1 billion. The company, which was launched in 2018 as a joint venture with TechStyle Fashion Group, counts among its shareholders blue-chip investors like Jay-Z’s Marcy Venture Partners and private equity firm L. Catterton (in which Bernard Arnault is an investor). Rihanna retains a 30% stake, according to Forbes. The final round of funding would be used for customer acquisition and retail expansion.

Not everything Rihanna touches turns to gold. In February, LVMH and Rihanna confirmed in a statement to Forbes that they had ended their other business, a high-end fashion and accessories house also known as Fenty. Launched in 2019, Fenty was looking to expand Rihanna’s brand of inclusivity and offer styles in a range of sizes. But like many luxury fashion brands, the high-priced line suffered during the pandemic, releasing its latest collection in November 2020.
The only complaint some fans can make about his career as a fashion and beauty mogul? It occupies him a lot. The singer, who used to release an album almost every year, hasn’t released a new album since. Anti, in 2016.
From a financial point of view, this can be very good: “She is building a brand outside of herself. It’s not just Rihanna, ”says consultant Shannon Coyne. “Even if you don’t like her music, she has created a real style in fashion and beauty.”

Article translated from Forbes US – Author: Madeline Berg

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