Thorne reaches $500M in revenue after L Catterton take private

Nutritional supplement brand Thorne is on track to reach $650 million in annual revenue this year, fueled by Generation Z and Millennial consumers who are increasingly focused on improving their health, CNBC has learned.

The 42-year-old dietary supplement brand, which L Catterton privatized in 2023, has maintained a compound annual growth rate of more than 30% since the acquisition, according to the company. Between 2022 and 2025, its revenue more than doubled, from $229 million to more than $500 million, according to filings and the company.

Meanwhile, the number of consumers shopping directly with the brand increased from about 4 million to nearly 7 million by the end of 2023, leading to a 63% increase in direct-to-consumer sales, the company said.

“A lot of what we’ve done over the last few years has been to streamline and focus and in some ways simplify our go-to-market, be really clear on who our consumer is that we serve, what they’re looking for from brands as we move forward, and look at our heritage,” said CEO Colin Watts, former CEO of The Vitamin Shoppe. “… Our expectation is that this brand will become a billion-dollar brand within the next few years.”

Thorne’s growth comes with a market for vitamin, mineral and supplement bubbles in the U.S. fueled in part by the “Make America Healthy Again” movement and health-conscious young shoppers looking to optimize their health and improve things like sleep and nutrition. Vitamins, minerals and supplements market Reached 125 billion dollars It will grow in the U.S. by 2025 and is expected to grow 11% by 2027, according to data collected by consulting firm AlixPartners.

“As the science evolves and frankly as the consumer gets more control over their health, there’s a shift in spending and focus to ‘what can I do to proactively manage my health in the future?'” Watts said. “There has been a change in direction,” he said.

Rising interest in nutritional supplements, a popular gift category this past holiday season, has created an opportunity for major retailers like Walmart, Target and Amazon, consumer products companies like Nestlé and smaller brands like Thorne. This also reflects a broader generational shift that is reshaping the industry. Once dominated by older consumers focused on preventative health, this category is today increasingly driven by younger shoppers interested in performance, customization and daily wellness routines.

“When I started researching and working in this market 25 years ago, it was a boomer-driven market; you basically focused on serving the boomers, that’s how you won in the market. So the reality is, today’s market is a Gen Z, Millennial market,” Watts said. he said. “One of the biggest trends with Gen Z is they don’t think of supplementation as prevention. They think of it as performance. ‘I want to sleep better. I want to have more energy. I want to manage my anxiety. I want to exercise better.’ something like. Those are the kinds of things they focus very, very much on.”

About 60% of Thorne’s total revenue comes from shoppers under 40, who spend about 1.5 times more than their parents spend on wellness, Watts said. Despite broader hesitancy from some younger consumers to commit to recurring subscription plans, it estimates that about half of shoppers under 40 are subscribers.

“One of the reasons Gen Z hates subscriptions is that adding something to a subscription and then seeing it cheaper somewhere else drives them crazy — and frankly, it drives me crazy,” Watts said. “We’re very disciplined about our pricing… You know, we don’t over-promote the brand, we don’t under-promote the brand. It’s pretty consistent.”

To entice consumers to subscribe and take a break from high prices, Thorne is offering free shipping and a 10% discount on every reorder. Subscriptions can come every two weeks or every four months. Shoppers can save 20% when they subscribe to three or more products.

As the supplement industry grows, so do reviews of ingredients, claims, and manufacturing, especially among younger customers who want to know how products are made. Supplements are not regulated by the FDA for safety or effectiveness, putting pressure on brands to produce their own testing that they can integrate into marketing campaigns.

“We spend a lot of time making sure we can prove the science and demonstrate effectiveness. For example, we are one of the few brands that has worked with the Mayo Clinic for over 14 years,” Watts said. “We’ve also worked with a lot of top sports teams. We’re the official extension of the UFC. We work with a variety of different tennis associations… all of which forces us to elevate our game because these are people who are much more savvy than the average consumer.”

When asked if the company had any intention of going public again, Watts said there was “no rush” to do so. He described an IPO as a potential route, along with a potential strategic acquisition by a larger firm.

“Like any private equity firm, I guess [L] “Catterton will look for the right opportunity, at the right time, for the right exit,” Watts said. “As we look at where we can grow right now, through physical retail, international expansion, larger expansion going forward, there are also a number of strategic companies that could see a brand like Thorne as a very strong asset in their overall portfolio.”