Why More Growth Companies Are Looking Beyond the Traditional IPO
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Enhanced Games at Resorts World Las Vegas. PHOTO: FACEBOOK@ENHANCEDGAMES
Enhanced Games reached the public markets in less than six months.
In an era where traditional IPOs can take more than a year to complete, the speed of the company’s merger with A Paradise Acquisition Corp. (NASDAQ: APAD) stands out, particularly given the significantly tighter regulatory scrutiny surrounding SPAC transactions since 2021.
The transaction highlights why some growth-stage companies are evaluating special-purpose acquisition companies (SPACs) as a viable alternative to the traditional IPO process.
Led by Dr. Aron D’Souza and backed by investors including Peter Thiel and Christian Angermayer, Enhanced Games announced its Business Combination Agreement with APAD in November 2025. The transaction closed in May 2026, bringing the company to the public markets materially faster than the timeline typically associated with a conventional IPO.
For decades, the traditional IPO has been considered the default route for private companies entering the public markets. But for many high-growth businesses today, the process has become increasingly slow, expensive, and difficult to execute efficiently.
A conventional IPO can take well over a year to prepare, involving extensive audits, regulatory reviews, underwriter coordination, investor roadshows, and careful timing against market conditions. During that period, companies remain exposed to volatility, shifting investor sentiment, and delayed access to capital. According to EY, many companies postponed planned IPOs amid market volatility and uncertainty surrounding U.S. tariff announcements, highlighting how sensitive IPO execution can be to broader market conditions.
For businesses operating in fast-moving industries, timing matters. Delayed access to liquidity can slow expansion, hiring, acquisitions, partnerships, and product development at critical stages of growth.
That is one reason why the merger between Enhanced Games and APAD is notable. The SPAC structure allowed Enhanced Games to negotiate valuation, governance terms, and financing arrangements early in the process, compressing many of the steps normally associated with a conventional IPO into a single transaction.
Enhanced Games operates across sports, media, performance science, and wellness, sectors that require significant upfront investment and rapid execution. Earlier access to public capital provided the company with liquidity, visibility, and strategic flexibility at an important stage of growth.
The public listing also gives the company tradable equity that can potentially support acquisitions, partnerships, athlete compensation structures, sponsorship arrangements, and future fundraising initiatives. These capabilities are particularly relevant in industries evolving as rapidly as sports entertainment, wellness, and human-performance science, where speed itself can become a competitive advantage.
The deal also highlights one of the SPAC market’s core advantages: the ability to combine capital raising and public-market entry within a single process.
Beyond speed, the SPAC structure offered Enhanced Games another major advantage: earlier visibility into valuation.
In a traditional IPO, pricing is largely determined near the end of the process through institutional book-building and investor demand during the roadshow phase. Even late-stage IPO candidates can face valuation cuts, downsized offerings, or postponed listings if market conditions weaken.
Recent IPO markets have repeatedly demonstrated this risk. Instacart went public in 2023 at an approximate US$9.9 billion valuation, which is dramatically below the US$39 billion private valuation it achieved during the 2021 market peak. Similarly, WeWork’s failed IPO attempt became one of the clearest examples of how rapidly investor sentiment can shift during the IPO process.
SPAC mergers operate differently.
Enhanced Games secured an implied enterprise valuation of approximately US$1.2 billion months before closing the transaction. While the merger still required SEC review and shareholder approval, the company gained significantly greater visibility into deal economics much earlier in the process.
That certainty is particularly valuable for growth companies whose valuations are tied more closely to long-term platform potential than near-term profitability.
Rather than relying entirely on shifting IPO market sentiment, the SPAC structure allowed Enhanced Games to negotiate around its broader growth strategy and future expansion plans from the outset.
The Enhanced Games transaction also reinforces why some growth-stage companies evaluate SPACs as an alternative to the traditional IPO process.
Traditional IPO investors often prefer businesses with long operating histories, stable earnings, and predictable growth profiles. Many expansion-stage companies simply do not fit that model yet, even if their long-term opportunities are substantial.
SPACs offer a different pathway.
Instead of waiting years to achieve the operational maturity typically expected in a conventional IPO, companies can access public-market capital earlier while still in growth mode.
For Enhanced Games, early access to the public markets provides more than capital. Public equity can support acquisitions, partnerships, athlete compensation structures, sponsorship arrangements, and future fundraising efforts. These capabilities are particularly important in sectors evolving as rapidly as sports entertainment, wellness, and human-performance science, where speed itself can become a competitive advantage.
The transaction also highlights how the SPAC market has evolved since the speculative boom of 2020 and 2021.
Today’s de-SPAC environment operates under significantly tighter regulatory scrutiny, including enhanced disclosure requirements, greater SEC oversight, and stricter treatment of projections and liability standards.
The Harvard Law School Forum on Corporate Governance noted that redemption rates spiked in 2022, in some cases approaching 100%, contributing to a significant slowdown of the SPAC activity.
In response to rising investor concerns and regulatory pressure, the U.S. Securities and Exchange Commission adopted enhanced SPAC disclosure and liability rules in 2024 designed to align de-SPAC transactions more closely with traditional IPO standards. Sponsors also faced greater pressure to demonstrate financing certainty, stronger disclosures, and more credible post-merger execution.
Enhanced Games completed its transaction within this more disciplined environment.
Its Form S-4 included audited financial statements, governance disclosures, transaction details, and extensive risk-factor analysis subject to SEC review. The company also supplemented SPAC trust proceeds with a separately arranged US$40 million PIPE financing commitment designed to strengthen liquidity and improve deal certainty.
That structure reflects a more institutional and disciplined SPAC market than the speculative wave seen several years ago.
The Enhanced Games transaction demonstrates that, despite tighter regulation and a far more selective market environment, SPACs can offer certain growth companies a practical alternative to the traditional IPO.
For businesses prioritising speed, capital access, and execution certainty, a well-structured de-SPAC transaction may provide a more efficient route to the public markets, particularly when supported by credible financing, disciplined structuring, and strong investor backing.
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From driving social change to making luxury affordable — Lessons from The Body Shop India
Updated
January 30, 2026 11:43 AM
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The Body Shop's storefront. PHOTO: ADOBE STOCK
The Body Shop, known worldwide for its ethical values and cruelty-free beauty products, has had very different results in two of its major markets. In the United States, challenges such as shifting retail trends and tougher competition led to the closure of most physical stores in early 2024. Meanwhile, in India, The Body Shop has risen to become one of its top five global markets. After reaching customers in more than 1,500 Indian cities through its omnichannel network, the company now plans to double its 200-store footprint over the next three to five years.
So what did The Body Shop do in India that proved harder to pull off in the U.S.? Below, we break down why The Body Shop struggled in the U.S., what’s driving The Body Shop India’s growth and what startup founders can learn from the contrast.
In March 2024, The Body Shop’s U.S. unit filed for Chapter 7 bankruptcy and stopped operating its roughly 50 stores. That move effectively ended its brick-and-mortar presence in the country.
A big part of the story is that the U.S. beauty market moved faster than The Body Shop did. Prestige beauty kept growing, and shoppers increasingly gravitated to retailers and brands that feel current and have a strong online presence. Paul Dodd, Chief Innovation Officer at e-commerce fulfilment partner Huboo, have pointed to The Body Shop’s slow approach to digital growth as a major factor behind its decline. With U.S. prestige beauty sales reaching about US$33.9 billion in 2024 and growing at 7% year over year, the demand is clearly there. The brands that stand out and get rewarded were the ones that matched how people now discover products and buy them.
The company also leaned too heavily on stores at a time when stores were getting harder to run. When foot traffic drops and rents rise, the pressure shows up quickly. Shoppers also had more places to go, including Sephora, Ulta, Amazon and direct-to-consumer sites. A similar pattern played out in Canada, where restructuring included store closures and halted e-commerce. It was another sign that North America had become an operational headache, not just a marketing challenge.
Then there’s the branding issue: its “ethical pioneer” position simply stopped being a moat in the U.S. market. Today, cruelty-free and vegan claims are now table stakes across many newer brands, and “clean beauty” messaging is everywhere. “Initially, the purpose-driven brand was revolutionary, so much so that competitors like Drunk Elephant have adopted a similar ethos,” says Dan Hocking, Chief Operating Officer at advertising agency TroubleMaker. “It was a concept that rightly earned success in the 80s and 90s, but The Body Shop didn’t adapt to changing consumer habits and preferences”. Meanwhile, competitors like Lush have kept people talking through stronger creator/influencer marketing, faster product cycles and more immersive in-store experiences.
Internal disruption likely made the turnaround even harder. Reporting on the U.S. bankruptcy points to instability, including the U.S. unit saying it did not have advance notice of decisions tied to the U.K. parent’s restructuring. When leadership decisions land without warning, it becomes harder to plan inventory, fund marketing and commit to a clear digital roadmap.
1. Expansion into tier 2 and 3 cities
For years, India’s beauty industry focused mainly on metropolitan cities. Today, however, increasing internet penetration, rising disposable incomes, exposure to global beauty trends and an appetite for ethical, sustainable brands have fuelled demand in smaller towns. That tailwind matters because India’s beauty and personal care market is expected to reach a gross merchandise value (GMV) of US$30 billion by 2027 and is projected to grow at roughly an 10% CAGR. There’s plenty of room for both premium and “affordable luxury” players that can meet consumer where they are.
The Body Shop has leaned into this shift. Harmeet Singh, Chief Brand Officer of The Body Shop Asia South, has said the brand is expanding into Tier 2 and Tier 3 cities with a focus on central and Northeast India. Reports also point to a clear advantage here: more than 200 stores across dozens of cities, plus online reach into over 1,500 cities. That foundation makes non-metro expansion feel like the next move, not a risky leap.
2. Omni-channel retail strategy for beauty shoppers
Unlike its U.S. front, The Body Shop India has put effort into digital and distribution. Besides its own online store, customers can find the brand on big beauty and retail platforms like Nykaa, Amazon, Flipkart, Tatacliq and Myntra. It has also built more direct routes to purchase through WhatsApp, social commerce, expert chats and live video consultations. For even faster access, it’s on quick-commerce apps like Blinkit and Swiggy.
This strategy is already showing up in the numbers. Nearly 30% of The Body Shop India’s business came from digital channels as of June 2025. Rahul Shanker, Chief Executive of The Body Shop India, has said the brand wants to lift online revenue to 45–50% of total sales by 2030.
This approach lines up with what’s happening in the market. NielsenIQ data found beauty e-commerce and quick-commerce sales in India rose 39% in value between June and November 2024, with offline growth over the same period being just 3%. The logic is simple: if the market is moving online, you want to be easy to buy online.
3. Inclusivity, accessibility and social impact
The Body Shop’s people-first approach shows up not just in its marketing, but in how it runs the business day to day. Inside the company, it has pushed gender sensitivity across teams. Out of 600 employees, it has 10 staff members who are part of the LGBTQA+ spectrum.
In stores, the brand has worked on improving accessibility. In 2024, The Body Shop India launched a Braille initiative for visually impaired customers. The programme introduced Braille category callouts in select locations so shoppers can navigate more independently.
On the sustainability side, the brand ties its message to its supply chain. An example is its long-term partnership with Plastics for Change, a Bengaluru-based social enterprise, to source “Community Fair Trade” recycled plastic for packaging. The collaboration has resulted in more predictable income, safer work and better access to social services and housing and education projects for the waste picker communities, which often include marginalized groups and women.
The same intent can also be seen in its physical retail. The Body Shop India has been converting stores into its “Activist Workshop” format, where everything is made from recycled materials, including store fixtures and interiors. By mid-2024, it had around 20 Activist Workshop stores in India.
4. Pricing that fits the Indian beauty market
In April 2025, The Body Shop India launched its “More Love for Less” campaign to make products more accessible. Through the campaign, the company lowered the prices of more than 60 best-sellers by 28–30%. The goal was to remove a clear barrier for many shoppers while maintaining the same quality.
The company has also positioned this as a pricing reset, not a short-term discount push. It’s meant to widen the funnel, especially among younger consumers aged 18–25, where price has been a major hurdle. That matters even more as the brand expands deeper into Tier 2 and Tier 3 cities, where value is often front and centre.
5. Local marketing that feels made for India
The Body Shop India has leaned into localized marketing in a way that feels specific, not generic. In late 2024, it launched “The India Edit”, a collection inspired by native ingredients like lotus, hibiscus, pomegranate and black grape. The tagline, “Only in India, for You,” makes the intent clear: India is not a copy-paste market. This approach matters because India is one of the most competitive beauty battlegrounds right now, with ongoing entry from global beauty brands. When everyone is fighting for attention, local storytelling helps The Body Shop stand out and feel closer to the customer.
The Body Shop’s story in the U.S. and India shows how differently a global beauty brand can perform depending on local strategy. In the U.S., it ran into a tough mix of fast-changing consumer habits, heavy competition and a liquidation process that left little room to rebuild. In India, the brand is riding big tailwinds in beauty retail growth, plus the shift to e-commerce and quick commerce. It has also put real effort into localization, pricing and omnichannel distribution.
If you’re trying to scale a consumer brand, there’s a clear takeaway here. Understand how your market shops, build strong digital distribution and make the brand feel local. The Body Shop India’s playbook is a useful example of how to do it.