CEO of Shea Moisture Calls Mitt Romney Ownership Rumors ‘Ridiculous’
Fresh out of business school with his home country facing a civil war, Liberian-born Richelieu Dennis combined entrepreneurial passion with his grandmother’s beauty recipes to create Sundial Brands LLC with his mother and former college roommate.
That was 25 years ago. Since then, Dennis has commercialized Nubian Heritage and – the more popular – SheaMoisture brands. Both product lines market to Black women with natural hair though women with textured hair are popular consumers as well. Many hair and beauty vloggers use and promote Sundial’s brands on their social media accounts.
All that good chemistry between brand and consumer came to a drastic halt when word got out that earlier this month private equity firm Bain Capital LLC signed a partnership agreement with Sundial Brands LLC for a minority stake with undisclosed amounts.
“What’s interesting is that we’ve been approached by just about every multinational (company) that is out there over the last year, two years and for us it was, and has always been about being family owned, community owned for the last 25 years,” Dennis said.
Black supporters of Sundial accused Dennis of selling out. Black female consumers enjoyed the fact that SheaMoisture was a Black, family-owned company. Dennis assures that he will continue to spearhead the company and its day-to-day operations. Sundial will remain the majority and will continue to be family operated. But a major part of the issue was held with the former co-founder of Bain Capital. Presidential nominee Mitt Romney who co-established the firm in 1984 reportedly retired in 2002.
“Mitt Romney has nothing to do with me. Nothing to do with us,” Dennis explained, “It’s not fair to characterize us or judge us based on an individual that’s got nothing to do with us.”
Presently the company pulls in an estimated 200 million in revenue, and Dennis intends to expand into international markets. The partnership developed out of a plan for long term survival.
“We knew we didn’t want to sell but [the question was] how to compete with all these multinationals focused in on our consumer trying to make similar products,” Dennis said.
Instead of losing his company entirely, Dennis took on an investor.
“When you think about where Black businesses have issues, it has always been [the lack of ] access to capital,” he said. “One of the hardest things to do is to get capital. That’s where we as Black business struggles. And the other place we struggle is scale and because we don’t have access to capital we cannot scale. [The investment deal] had to be with a partner that had a social mission at the core of its business model.”
For Dennis, the partnership serves as an opportunity to accelerate Sundial’s social entrepreneurship and keep his Black consumer community at the front of its mission. Upon the announcement of the deal, Dennis expressed his satisfaction with Bain Capital.
“We recognize that African American women have long been at the forefront of the natural hair and body movement that has created the dynamic cultural shift that we see today,” he said. “In addition, they have compelled multinational beauty brands and retailers to acknowledge and be more respectful of their needs. We are moving forward to build Sundial into a global-family-owned-and-operated consumer brand which they can be even more proud.”
Sundial is a certified B-Corp company with a Fair Trade for Life social and fair trade certification. Naturally, many consumers were also concerned about Sundial’s ingredients. Sundial’s products promote healthy, organic, and natural ingredients. They addressed Sundial via social media to question if the company’s expansion and newfound partnership would lead to cheaper ingredients for mass production.
Dennis denied this possibility as well.
“The reason we’re successful is because we spend every day to make the best products we can make,” Dennis said. In addition to Bain’s investment funding, the money supports fair wages for the women who source the company’s shea butter in African countries. According to Dennis, the partnership helps double the women in the Ghanaian cooperatives from 4,000 to 8,000 or more.
“If anything, this only makes us stronger,” Dennis said.
Dennis said that even with the expansion, the company would not abandon its African roots.
“[We] are going to continue to serve our core,” Denis said. “If we all of a sudden became something else, my grandmother would turn over in her grave.”
The partnership between Sundial and Bain Capital serves as a good reminder to where the Black dollar could be more effectual. A partnership with a Black-owned venture capital firm would have probably put Black women at ease. For now, companies like Sundial are managing the best they can.
“As a kid growing up, one of the brands I thought was tremendous was Karl Kani… and I don’t see Karl Kani today. I want to see SheaMoisture tomorrow,” explained Dennis, “Once a company develops out of its consumer base you will often see a well-funded multinational company come in and take over that space. The Black-owned company either stays a niche company or just disappears. Now with this investment it allows us to make moves that will keep this company in the family for another four generations and beyond. My goal is to have my children take over and their children and so on.”
To clear up any further confusion the company has listed 10 Reasons We Partnered With Bain Capital on its website.