On Wednesday, digital-first CPG company Heyday announced it acquired acne brand Zitsticka.
Heyday has been associated with scooping up Amazon-native brands. It currently has 20 brands in its portfolio between personal care, wellness, home and outdoor, including actress Eva Longoria’s cookware brand, Risa. Heyday has an annual revenue of more than $200 million and has raised $800 million in outside funding, said Sebastian Rymarz, CEO and co-founder of Heyday.
For its part, Zitsticka has grown 100% year-over-year since its launch in 2019. It has four revenue channels, including wholesale, Amazon, DTC e-commerce and professional. Its retail partners include Target and Ulta Beauty. The terms of the deal were not disclosed.
“Acne is a growing category and is growing faster than skin care. And patches within the acne category are outgrowing the acne category median by a mile,” said Rymarz. “Heyday is excited about new and efficacious products. Alternative forms of acne care are resonating with consumers.”
Zitsticka was not initially for sale. The 3-year-old brand was exploring a Series B fundraise in the spring after already raising $7.75 million in 2019. When the team met with Heyday, the conversation turned to acquisition. Notably, Daniel Kaplan and Robbie Miller, co-founders of ZitSticka, moved from New York to Australia in 2020, creating a logistical strain on their leadership. Kaplan and Miller will transition into an advisory capacity moving forward, while a Heyday brand manager will serve as interim CEO. Zitsticka has a team of 25 employees, while Heyday has 240. Rymarz said there have been no planned layoffs from Heyday due to the acquisition.
“What was important to us in making this decision was that we got under the hood of the Heyday business and met their team and understood who would be driving it forward,” said Miller. “Aside from the culture fit side of things, there is a real understanding that they get the brand, our message and what we stand for. They get the identity and who we are as a business.”
Acne-care brands have gained substantial attention from investors and acquirers alike. Church & Dwight purchased Hero Cosmetics for $630 million in September, while Peace Out raised a $20 million series A, announced Monday. But there are a whole host of others, including Starface, Peach Slices and Fazit, to name a few. According to Grandview Research, the acne dermal patch market is worth approximately $510 million in the U.S. and is poised for growth through 2030.
“Acne has had a lot of tailwind over the last decade. It was extremely antiquated before, with Clearasil, Clean & Clear and Proactive owning the space. But with innovative brands like us, Hero and Starface, we’ve helped de-stigmatize the space and make treating acne cool,” said Kaplan.
Rymarz said Zitsticka checked several boxes for Heyday. Heyday looks to acquire digital-first brands earning $10 million to $50 million in revenue and focused on personal care, wellness, home or outdoor. It also had an affinity for the brand and the acne category it plays in. Zitsticka sells 13 products, including face wash and supplements, for $16-$60.
Rymarz said Heyday’s core competency is to help scale small brands into big ones through a mix of digital ad bidding, inventory demand forecasting and dynamic pricing tools. It also has an office in China, which could be key for brands looking to break into the lucrative market.
“If you have a great brand but a suboptimal product, that doesn’t work [for Heyday]. At the end of the day, we don’t want to be in the business of selling snake oil,” he said. “It starts with a great product. Zitsticka takes science and technology seriously and takes its products seriously.”