As the Jessica Alba-founded start-up Honest Co. eyes a listing on the stock market, it's picking up an additional $70 million in funding.
The investment values the company in the high hundreds of millions of dollars, according to a source not authorized to publicly speak about the transaction.
Honest Co. generates most of its revenue from shipping bundles of eco-friendly, toxic-free diapers, bath products and cleaning goods to hundreds of thousands of subscribers. It also sells its more than 85 products online and at retailers such as Target, Costco and Whole Foods. Sales have been growing, but the latest round of funding should help the company more quickly develop new products.
Anything that touches or rests near the skin is of interest, said Sean Kane, the company's president and co-founder. But on the immediate radar are items such as baby formula and cosmetics.
He called the new funds "further validation that customers are paying more attention to what they put in and around their bodies."
Part of the investment, which brings the start-up's total funding to $122 million, comes from Wellington Management Co. Wealth management firms like Wellington like to invest in companies to get a close look at how they operate before the company goes through an initial public offering. Dragoneer Investment Group and "one other leading public market institutional investor" also invested in Honest Co., the company said.
Kane said the company was definitely interested in going public but that a timeline was uncertain.
"We'll continue to assess that opportunity based on growth," he said. "Investors certainly aren't putting pressure on us."
The law firm Cooley LLP said it advised Honest Co. on the deal.
Chat with me on Twitter @peard33