Studs

Studs successfully executes its aggressive store expansion plan, reaching over 40 locations by the end of 2025 and continuing strong growth into 2026. Its 'Earscaping' brand and needle-piercing experience capture significant market share from traditional players and other DTC competitors, driving revenue growth well above 150% annually. This leads to an acquisition by a major beauty or lifestyle conglomerate at a valuation of approximately $238M, providing a 300% return for common shareholders after accounting for liquidation preferences.

Studs continues its steady growth, expanding its retail footprint and maintaining its differentiated brand appeal among Gen Z and millennials. It achieves near-profitability, growing revenue at a healthy pace (e.g., 50-70% YoY). The company is acquired or secures a new funding round at a valuation of approximately $150M, resulting in a ~109% return for common shareholders after liquidation preferences.

Increased competition from existing players like Claire's (despite their challenges) or new DTC entrants, coupled with slower-than-expected store performance or a general downturn in discretionary retail spending, hinders Studs' growth. The company struggles to achieve profitability at scale, leading to a down round or an acquisition at a valuation of approximately $60M. Given the $54M in liquidation preferences, common shareholders would experience an ~87% loss.