Blackstone bet on ZO Skin Health, a brand you won’t find at Sephora. Now it could be worth $2 billion

Beauty brands can command eye-popping prices, whether they’re celebrity-founded and internet-famous or built around a doctor’s name. E.l.f. Beauty agreed to pay up to $1 billion for Hailey Bieber’s Rhode, Coty paid $600 million for 51% of Kylie Cosmetics, and Shiseido spent $450 million on Dr. Dennis Gross Skincare.

Now Blackstone is testing whether a far less famous skincare name can command an even higher valuation. The investment firm is exploring a sale of ZO Skin Health that could value the company at around $2 billion, Reuters reported this week, citing people familiar with the matter. Unlike celebrity-driven brands such as Rhode or Kylie Cosmetics, ZO built much of its business not through influencers or department stores but through dermatologists and medical-aesthetics practices.

Founded in 2007 by dermatologist Dr. Zein Obagi, ZO initially followed a more traditional beauty-retail path, launching at Nordstrom that same year, according to the company’s own timeline. But it soon moved away from department-store shelves and reoriented around physicians instead.

Imagine walking into a dermatologist’s office or med spa with acne, pigmentation, or signs of aging. Instead of scrolling past a TikTok creator calling a serum “so good,” a professional tells you your routine should include a cleanser, exfoliant, serum, and treatment cream. For consumers already seeking help with a skin concern, that recommendation can carry considerably more weight.

ZO also gave medical practices a financial reason to stay involved. In 2012, it launched physician affiliate and revenue-sharing programs that let participating doctors earn commissions when patients replenished products through physician-linked virtual stores.

The brand embeds itself in the treatment room, too, not just on the retail shelf. Its pigmentation and skin-conditioning protocols can be paired with procedures such as lasers, chemical peels and microneedling, and the company provides protocol training, staff education and support around product launches and merchandising, according to Med Spa Vendor Hub.

Those tactics are not necessarily unique to ZO. Rivals including L’Oréal-owned SkinCeuticals, AbbVie’s SkinMedica, Skinbetter Science and Alastin also court dermatologists and medical-aesthetics practices with their own professional distribution and provider-support programs.

Aesthetic nurse specialist Roxette Romanes of SkinSpirit’s Roslyn Heights location said ZO’s economics are broadly similar to those of other professional skincare brands the clinic carries. “Everyone is pretty on par on prices. I don’t think there’s a skin care brand that is more or less. They are pretty similar regarding pricing,” she said, adding, “Other than getting the sales from the actual skin care, I don’t think there’s more incentive than that.”

Tight distribution and word-of-mouth

The company tightly controls where it sells its products. Today, ZO says authentic products are available through its official website and authorized providers, with some prescription products requiring a physician; it no longer relies on department-store shelves.

That restricted distribution does more than create exclusivity. It helps ZO protect premium pricing and gives medical practices a reason to keep selling the brand. The company says it works to minimize unauthorized sales “to protect our customers, along with the integrity of our trusted physician partners’ businesses.”

But ZO doesn’t rely entirely on providers to create demand. Board-certified New York City plastic surgeon Dr. Jeffrey Lisiecki said the brand already has strong recognition among patients.

“It’s been around for a long time, it’s got a lot of brand recognition, it’s a well-respected name in the skin care industry. There’s some products that they have that are really popular that a lot of people really like. I get requests for their sunscreen all the time,” he said, adding that “a lot of patients know of it and ask about it sometimes even before I’ve given someone their post-operative skincare regimen.”

Nearly 40% of ZO Skin Health customers at medical-aesthetics practices made a repeat ZO purchase in 2025, according to Guidepoint Qsight’s 2026 Aesthetic Industry Impact Players report, which draws on transaction data covering more than $17 billion in verified patient spending from thousands of U.S. aesthetics practices. Qsight said that was the highest patient-retention rate among the leading professional-grade skincare brands in its analysis.

By 2016, ZO said, it had become the No. 1 physician-dispensed medical skincare brand in the European Union. As a private company, though, it doesn’t disclose annual sales, making its overall financial scale difficult to gauge.

Public filings from Cutera, ZO’s former distributor in Japan, offer a rare glimpse. Cutera reported $34 million in revenue from ZO skincare products in Japan in 2023, down from $42.5 million in 2022 — 16% and 17% of Cutera’s total revenue, respectively. The figures don’t represent ZO’s total sales in Japan, but they show the brand was large enough in a single overseas market to make up a meaningful share of another company’s business.

Blackstone noticed the model years ago. When it acquired a majority stake in ZO in 2020, Senior Managing Director Todd Hirsch called it “one of the fastest-growing brands in the rapidly expanding professional skincare market.”

ZO may not have Rhode’s social-media fame or Kylie Cosmetics’ celebrity machine. But its physician network, tightly controlled distribution, premium-priced products, international reach and strong repeat purchasing help explain why a brand many consumers barely know could command a valuation approaching $2 billion.

This story was originally featured on Fortune.com