Recently, YAN BEAUTY REVIEW learned that Shanghai Henai Industrial Co., Ltd., the parent company of the domestic cosmetics brand HEDONE, completed an equity transfer. Sequoia China, Chenhai Capital, Pengpai Capital, and the overseas shareholder Explorer Fourteen Limited—four institutions collectively exited, transferring a total of 38.73% equity. The acquirer is a trading company established in 2021 with a registered capital of only 100 ten thousand yuan, with no connection to beauty.
This is not the quiet curtain call of an established domestic brand. This is a standard period marking the end of the new consumer beauty investment wave from 2016 to 2020. Capital has completely left, no longer holding any illusions. The former darling has been gently crossed off the financing table.
▍ Screenshot from the National Credit Information Publicity System
HEDONE's story began in 2014. Founder Qu Xinzhe, with a background in financial mathematics from King's College London, once managed Biotherm at L'Oréal in London; co-founder Zhou Cheng, after graduating from Oxford University, moved between Bain & Company and Xiaohongshu. The combined background of such a founding pair was considered luxurious in the domestic cosmetics startup circle at the time.
In early 2018, HEDONE officially launched its color cosmetics. The first product, the "1986 Legendary" eyeshadow palette, inspired by Journey to the West, played the national trend card; in 7 of the same year, the "Seven Deadly Sins" lip gloss series was released, using seven dark sides of human nature as themes. Within less than six months of entering Tmall, monthly sales jumped from 49 ten thousand yuan to ten million, ranking among the top twelve new brands in Tmall beauty and personal care. By the eve of its closure, the flagship store had accumulated 170 ten thousand fans.
▍ HEDONE classic series products
Capital's rhythm precisely stepped on the heat curve: in 2017, Pengpai Capital and Sequoia China jointly invested tens of millions of yuan in a Series A round; in 2018, Sequoia made a follow-on investment in a Series A+ round; in 2019, Chenhai Capital entered to complete a Series B round.
After the climax receded, there was a long silence. After 2022, HEDONE never launched a new product. In 2024 11, the brand proactively issued a farewell letter and terminated operations. It was not until 2026 6 that this equity change occurred, with the four institutions clearing all their shares at once.
What does this mean? Capital not only did not rescue, but did not even wait for a successor; they simply quietly completed the write-down on their financial statements, then turned and left. The trading company with a registered capital of 100 ten thousand yuan that took over is not a new owner but an asset cleaner: inventory, cash, and trademarks are being packed up and disposed of.
▍ Henai Industrial financing history chart
For brands that were lifted up and then let down in the new consumer investment frenzy, HEDONE's final outcome is a standard period.
If we only look at consumer enthusiasm, HEDONE seemingly did not have to come to this. Before closing, it re-released a classic lip gloss at a price of 125 yuan for three, with some shades selling out within two days and single-link sales exceeding 10 ten thousand pieces. The Tmall flagship store still had 170 ten thousand fans, and the market could still accept it. So what exactly led to the brand's demise?
Founder Qu Xinzhe gave the answer in the farewell letter: "We could not find the answer to 'why we need to create a new product.'"
This sentence deserves repeated contemplation. It points to a fundamental reason: HEDONE's closure was not due to intensified market competition, nor due to a broken capital chain (at least there is no conclusive evidence in public information), but due to the exhaustion of creativity. Of course, we cannot rule out the possibility of team infighting, equity disputes, or hidden cash flow problems. But it is extremely rare in the business world for a founder to proactively say "I cannot find a reason to create." We can regard creative exhaustion as the perspective closest to the truth.
HEDONE's essence is content-driven, not product-driven. It rose on aesthetic copywriting, refined social media marketing, and unique brand values. This was its sharpest weapon and also its most fatal hidden danger.
Why? Because content has boundaries. HEDONE's content motifs—self-exploration, the dark side of human nature, rebellious spirit—are a narrative space with limited capacity. "Seven Deadly Sins" exhausted seven human natures, and "1986" exhausted Journey to the West. What next? HEDONE failed to find an eighth sin, nor the next cultural symbol worth deconstructing.
The survival cycle of content-driven brands is naturally shorter than that of product-driven brands. Consumers' patience with the same narrative system usually does not exceed three years. Aesthetics can support a brand for three years, but to live beyond ten years, what is needed is not aesthetics but a continuous supply of creativity.
There is a point that is easily misunderstood: content-driven does not necessarily mean short-lived. LVMH and L'Oréal also have many long-lived brands driven by storytelling. The difference is that those brands' content is renewable, continuously evolving around an eternal motif (such as female power or Parisian elegance), rather than each new product attempting to consume a complete cultural symbol. HEDONE's narrative model is more like making movies: each one requires a brand-new script and a brand-new worldview. And even film directors need three to five years to polish a work; a consumer brand can hardly bear such a creative cycle.
When a brand takes the pursuit of the ultimate self as its spiritual core, and every new product launch carries the output of values, then when the founder feels they have nothing new to say, the brand has reached its end.
Brands that rise on content may need to think clearly from the start: after the story is told, what will the next chapter be?"
HEDONE's equity liquidation is not an isolated event. Placed against the industry background of 2023–2026, the pattern becomes clearer.
In these three years, VNK, Fuqi, Happimess, Naijizi, HEDONE... batch after batch of once-prominent new domestic color cosmetics brands exited the stage through official closure, bankruptcy liquidation, or low-price acquisition. In 2025, Blank Me Banfen Yi, once hailed as the number one domestic base makeup brand, was applied for bankruptcy by a supplier; in 2026 5, this news officially landed.
The common trajectories of these brands are highly similar: relying on capital, Xiaohongshu seeding, live-streaming sales, and the national trend concept to rise quickly, seizing a position during the traffic dividend period of 2018–2019. But when the traffic dividend faded and customer acquisition costs soared, the vast majority of brands failed to build real barriers.
The so-called barrier is not a viral note, a star product, or a top streamer's live broadcast, but the depth of product research and development, control over the supply chain, and the irreplaceability of brand mindshare. These are precisely what fast-growing brands lack the most.
At the same time, in 2025 China's cosmetics omni-channel transaction volume exceeded 1.1 trillion yuan for the first time, and the domestic brand market share rose to 57.37%. But the other side of prosperity is brutal differentiation: 2.69 ten thousand brands disappeared from the market throughout the year, more disappeared than newly born. Among the top 500 brands, more than 60% maintained positive growth, and the total retail sales of TOP50 brands increased by 11.56% year-on-year. The growth of the total market volume is no longer related to the vast majority of small and medium-sized brands.
Data from the investment and financing side further confirms this judgment: in 2024–2025, beauty brands are no longer the preferred targets of venture capital, and hot money flows to upstream raw materials and AI technology companies. Capital has not left, it has just changed its approach—from venture capital-driven to industrial mergers and acquisitions integration. Industrial capital such as Proya, Ruoyuchen, and Yingtong are sweeping up goods.
Under this pattern, small and medium-sized brands are in an awkward position: too small to attract the merger and acquisition interest of industrial giants; growth stagnant, and unable to continue receiving blood transfusions from VC.
HEDONE's equity liquidation has drawn a clean and neat full stop to the beauty entrepreneurship wave of 2016–2020. That wave of new consumer brands, ripened by capital and fed by traffic, has basically settled by now.
The picture of the industry's endgame is becoming clear: leading brands are acquired and integrated by giants, tail brands are dying out in batches, and the living space of the middle layer is being sharply compressed. For the vast majority of emerging brands, the question has changed from how to live well to how to live long.
And the answer is clearly not in the next livestream.
What HEDONE leaves to the industry is not regret, but a multiple-choice question: is a brand a product company or a content company? The former needs to endure slowness, the latter needs to bear shortness. The most feared thing is that under the urging of capital, one thinks one is both, but ends up being neither.
Sequoia and others spent ten years completing a full exercise of scattering money–ripening–clearing positions. HEDONE is not their only loss-making case, but it may be the most dignified one; at least it died on content, not in the warehouse.
This full stop is not written too badly.