Able C&C is a corporations that led the K-beauty craze in the early 2000s with the "MISSHA (MIS-SHA)" brand. However, after struggling due to the slump in Korea's road shop market, it reached a turning point when it was acquired in 2020 by IMM Private Equity (IMM PE), a domestic private equity fund. Chief Executive Shin Yu-jung, who moved to Able C&C in 2021, turned the company, which had been in a slump, to profit in just one year.
Shin decided to boldly streamline stores in the fiercely competitive domestic market and turned to overseas markets. To target the U.S. market, an overseas market, it was necessary to withdraw from directly operated domestic stores and reduce headcount. Shin persuaded IMM PE, Able C&C's largest shareholder, to push into English-speaking markets, and MISSHA, which entered the U.S. market in May, has already begun to deliver results. MISSHA BB cream ranked No. 1 in the BB cream category on Amazon U.S. and No. 3 in the makeup category on TikTok Shop.
According to the U.S. International Trade Commission (ITC), last year Korea overtook France to become the country that exported the most cosmetics to the United States. With K-beauty's global success, private equity funds, backed by capital and networks, are establishing themselves as "growth supporters" for K-beauty corporations. Shin said, "(IMM PE) tends to fully trust and leave things to management once the big strategic direction is set," adding, "We strengthened trust with the largest shareholder by establishing strategies based on data-driven thinking and market trends." The following is a Q&A.
What positive changes do you think private equity investment has brought to the K-beauty industry as a whole?
"In the K-beauty industry, manufacturers such as OEM (original equipment manufacturing) and ODM (original design manufacturing), component suppliers, logistics companies, and brand companies are thoroughly specialized. When external capital flows in from private equity, the productivity and competitiveness of the entire industry rise together. Manufacturers and component suppliers can increase technology investment to produce higher-quality products at lower prices, logistics companies can secure liquidity to realize economies of scale and respond immediately to overseas demand, and brand companies can focus on aggressively executing marketing to create consumer demand."
What role did IMM PE play as you managed the company?
"IMM PE is the largest shareholder, holding 60% of Able C&C's shares, but the remaining 40% are shares circulated in the market. The budget we invest overseas must be created within the company's own profit and loss and cash flow. Ultimately, it is a structure in which we generate profits internally and reinvest those profits. Then what is the role of private equity? The goal of private equity is 'how to value-up (raise value) this company and sell it at a higher valuation.' Therefore, what I have to do is persuade the largest shareholder, the private equity fund. For example, we determined that shrinking Korean stores could reduce short-term sales. Instead, rather than focusing only on the domestic market, we presented the logic that concentrating on overseas online and offline retail would allow us to receive a much higher multiple on EBITDA (earnings before interest, taxes, depreciation and amortization) over the long term. IMM PE understood this, and we were able to take on the challenge of entering English-speaking markets."
What did you do to earn IMM PE's trust?
"I tried to make every decision as 'data-driven' as possible. Able C&C's export ratio has risen to 60%, but considering the size of the global market, we judged it should expand further. In particular, to deliver clear results in the United States, the world's largest beauty market, we believed we had to compete on 'TikTok,' where Generation Z (born 1997–2010) is most active. That's because it is a platform that connects from content exposure to purchase. I believe that this data-driven mindset and strategy development based on market trends strengthened trust with the largest shareholder."
Was there any information sharing or financing support among IMM's portfolio?
"Under IMM, there are buyout (a transaction to acquire a corporations or specific asset and secure full ownership) and equity investment portfolios across various industries. Even if they are not in the same industry, we share information and create synergy in multiple areas such as distribution, marketing, talent, ESG (environmental, social and governance), and financing. These exchanges are a big help in improving work efficiency."
What are the practical difficulties when working with private equity?
"It is hard to generalize because private equity funds each have different philosophies and operating methods. In IMM PE's case, once a strategic decision is made, execution is left to management, so there are no constraints on managerial autonomy. However, because private equity portfolio corporations aim to enhance value through structural changes, the intensity of work is certainly higher than at general corporations."
Will private equity investment in K-beauty continue?
"Overseas demand for K-beauty is stronger than ever. As further growth is expected, I think it is natural that various investors, including private equity, are flowing into the market. The inflow of private equity capital clearly helps the industry's advancement. However, we should not make the mistake of being unable to respond to the growth of 'C-beauty (Chinese cosmetics brands)' because of overheated competition that abnormally pushes up overseas marketing costs or leads to cutthroat competition among K-beauty brands. A balanced approach is needed."
What is Able C&C's goal for 2026?
"We plan to continue global expansion with a goal of 75% overseas sales share in 2026. MISSHA BB cream is so competitive that even now one is sold every five seconds worldwide. I believe MISSHA already holds a unique position as a hybrid brand that spans skincare and makeup. Our goal is to have more overseas consumers experience and love MISSHA."