The Buyer Is Already in the Room

No. 97 | The conditions for the greatest CPG acquisition cycle in a generation are already set. The only question is whether you built something worth buying.

"I don't throw darts at a board. I bet on sure things." — Gordon Gekko, Wall Street (1987)

The report that L Catterton is exploring a sale of Thorne at up to $4 billion is the latest proof of something I’ve been watching build for two years. The largest consumer companies in the world are sitting on piles of cash, watching younger consumers walk away from their brands, and staring at innovation pipelines that cannot move fast enough. They have one move left. And they’ve already started.

The proof is in the tape. PepsiCo and Poppi for nearly $2 billion. e.l.f. Beauty and Rhode for $1.3 billion. Unilever and Dr. Squatch at $1.5 billion. Hershey and LesserEvil. Mammoth Brands and Coterie for north of $650 million. Church & Dwight and Hero for $630 million. Six deals in eighteen months. Nearly $9 billion deployed into brands most legacy boardrooms couldn’t have named a year earlier.

This isn’t a spike. It’s the start of a cycle that’s already underway.

None of these buyers think they’re early. That’s exactly why the pace is accelerating.

The narrative repeated at every panel from 2022 onward was that the DTC exit market was broken.

The lesson was real.

The conclusion was wrong.

The market didn’t disappear. The standards changed. What strategics learned wasn’t don’t acquire. It was don’t acquire broken unit economics dressed up in clever branding.

The brands that burned in the first DTC wave in many cases deserved their fate. They were Facebook ad machines wearing the costume of consumer insight. The brands being acquired now are different.

To understand why the next three to five years will be the strongest CPG acquisition window in a decade, you have to understand the reset that happened quietly between 2022 and 2024. Global M&A froze under higher rates and uncertainty. That freeze did something useful. It removed the marginal deals. By 2024, deal value had rebounded more than 25% while volume stayed disciplined. In CPG specifically, deal value rose over 50% in 2025 despite fewer transactions. We are exiting a no-deal environment and entering a best-assets-clear-at-premium market. That’s where the most value gets created.

The pressure on the buyer side is structural, not optional. Large CPG companies have one problem: organic growth is broken. Their R&D can produce line extensions. It cannot manufacture cultural credibility. It cannot build the kind of trust that Grüns built on TikTok³ or that Rhode built through a medicine cabinet and a very specific kind of aspirational quiet.

Authenticity doesn’t scale from a corporate campus in Cincinnati. And they know it. So they have to buy. There is no internal alternative. And no time to build one. Their mandate to do so is written into strategic plans that already have board approval.

Unilever has committed roughly €1.5 billion annually to acquisitions, with explicit focus on U.S. assets.¹ That’s not optionality language. That’s a decision already made. The only question left is price and timing.

The forces driving this are the same ones I wrote about in Big Food’s Tobacco Moment. The chemistry that built these empires has become the liability. GLP-1 medications are rewiring how millions think about consumption.

When regulators, consumers, and culture all move in the same direction, the outcome is locked. As I argued in The Golden Age of Consumer Investing, health is no longer a niche. It’s the baseline expectation. The categories where startups are winning are exactly where incumbents are weakest. That gap is the acquisition thesis.

But there’s a second buyer most founders aren’t thinking about. Private equity is back, actively targeting consumer brands in the middle market, and now exiting them at scale. L Catterton’s reported Thorne sale is the clearest signal yet. They bought a disciplined, science-backed supplements brand, built it, and are now positioning it for a strategic exit at a number that reflects a $235 billion market growing fast. That’s the flywheel: PE buys the platform, strategics absorb the exit. At the same time, large CPGs are divesting non-core brands to focus on their highest-margin segments, creating a large pool of targets. The result is a two-sided market with real competition for quality assets. That dynamic didn’t exist at scale in 2021. It does now.

The vintage of brands built between 2019 and 2024 is the best-constructed DTC cohort in history. Those founders learned, the hard way, that customer acquisition cost is not a growth lever. They built for repeat purchase. They tracked retention with the discipline of a SaaS CFO. They went omnichannel before the strategic asked them to.

Olive & June turned nail polish into recurring revenue before Helen of Troy wrote the $240 million check.² As I wrote in One Brand Is Luck. Two Is Strategy., Mammoth’s Coterie acquisition wasn’t about diapers. It was proof that the DTC acquisition blueprint is being codified in real time. The ones that made it through 2022 and 2023 without collapsing proved something a strategic acquirer actually needs to see: the business works without the spend. That proof is what separates a storytelling acquisition from a cash flow acquisition. The market has moved firmly toward the latter.

We’ve been watching this build for two years. The brands we’ve backed that fit this profile, habitual use, genuine repeat purchase, cultural resonance, strong margins, are the ones getting unsolicited calls from strategics. Not term sheets. Conversations. Relationship building before any formal process. That’s what the early innings look like. The buyer is already in the room. They’re just not negotiating yet.

Most companies reading this will not get acquired. If your business needs paid spend to survive, you are not an acquisition target. The founders who understand this moment will do three things. Build toward what a strategic actually values. Retention over acquisition. Gross margin over top-line velocity. Retail presence that proves the brand travels off-platform.

Avoid raising capital that breaks acquisition math. And build a real category, not just a brand. Poppi didn’t win because it made a better soda. It won because it built a behavioral category around prebiotic hydration and became the default before anyone else could. If you want the tactical playbook, Consumer M&A: Hard Truths and Strategic Realities is the place to start.

Hype-driven brands with no retention and no margin will not clear in this market. That window is closed. The next three to five years will be more rational, more selective, and for the founders who built the right way, the best exit environment in a decade.

The buyers have the mandate, the capital, and nowhere else to buy growth.

Build accordingly.

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¹ Unilever Ventures is a limited partner in Sugar Capital Fund III.
² Lisa and I were angel investors in Olive & June.
³ Grüns is a Sugar Capital portfolio company.