Latest / Skin Anarchy / The Basics of Building A Successful Beauty Brand and Navigating The Business Of Beauty Ft. Joël Palix

Transcript

The Basics of Building A Successful Beauty Brand and Navigating The Business Of Beauty Ft. Joël Palix · Skin Anarchy

• 0:00
  SPEAKER_02: Hi guys, welcome back to the new episode of Speaker Manager.
• 0:03
  SPEAKER_02: This is your host, I think.
• 0:04
  SPEAKER_02: I'm very excited about our guest today because this episode is going to cover a topic that I think a lot of you brand founders out there, a lot of you entrepreneurs out there that chime in all the time about your questions around the business of beauty, the business of starting your brand, scaling your brand, you know, bringing it to the point where you're feeling like you're truly succeeding in your endeavors.
• 0:26
  SPEAKER_02: Like a lot of those questions are going to be addressed today.
• 0:29
  SPEAKER_02: So without further ado, I want to introduce you guys to Joel Paleks, who operates Pallox Unlimited, which is a boutique consultancy specializing in advising beauty brands and investors on strategic initiatives and mergers and acquisitions.
• 0:42
  SPEAKER_02: So without further ado, welcome, Joel.
• 0:44
  SPEAKER_02: I'm so excited to host you and learn from you today.
• 0:46
  SPEAKER_00: Well, thank you, Hector.
• 0:47
  SPEAKER_00: I'm excited too, and uh very happy to be speaking to you um from Lisbon in Portugal, where I live half of my life.
• 0:55
  SPEAKER_02: Oh, how lovely! Is it nice over there today, the weather?
• 0:59
  SPEAKER_00: The weather is perfect.
• 1:00
  SPEAKER_00: It's a little bit like California of uh Europe.
• 1:02
  SPEAKER_00: In fact, some Americans decided to come and live here, but uh I also uh work and live in Paris.
• 1:10
  SPEAKER_00: Uh and obviously I travel the world for my business.
• 1:13
  SPEAKER_00: Yeah, but it's a good base.
• 1:15
  SPEAKER_00: It's a very good base.
• 1:16
  SPEAKER_02: That's so cool.
• 1:16
  SPEAKER_02: That's great.
• 1:17
  SPEAKER_02: I'm I'm jealous.
• 1:18
  SPEAKER_02: And yeah, I haven't been to Europe in quite some time, so I'm jealous.
• 1:21
  SPEAKER_02: But I want to I want to get started, Joel.
• 1:23
  SPEAKER_02: I want to learn all about you and your background and what got you into being interested in the beauty and wellness space, you know, with your work.
• 1:30
  SPEAKER_02: What really sparked your interest there?
• 1:32
  SPEAKER_00: Well, you know, it all started when I was a young Frenchman and I wanted to uh work uh on international markets, and I picked uh beauty because I felt that the French stamp could uh could be an advantage in uh in selling beauty products.
• 1:46
  SPEAKER_00: And uh probably I was right.
• 1:47
  SPEAKER_00: I did a nice career in the in that industry.
• 1:50
  SPEAKER_00: I served as uh managing director for Europe, France, and Spain at uh Yves Saint Laurent Beauty in the in the 90s when I was at the beginning of my career.
• 2:00
  SPEAKER_00: And that's where I learned uh the art of launching and uh distributing fragrances and uh and makeup.
• 2:07
  SPEAKER_00: That's where really I learned the roads of uh of beauty with uh with Yves Saint Laurent.
• 2:12
  SPEAKER_00: It was uh it was a nice time.
• 2:14
  SPEAKER_02: That's really cool.
• 2:15
  SPEAKER_02: Yeah, I think some of my very early favorite products were by YSL.
• 2:19
  SPEAKER_02: I loved everything I would buy, you know, literally.
• 2:22
  SPEAKER_00: I collaborated with uh Thierry de Gunsbourg, who was the um makeup artist, makeup creative director of Yves Saint Laurent, and uh she developed a product which I launched called um Touch-Kla.
• 2:36
  SPEAKER_00: Touchla is still an amazing, an amazing product.
• 2:40
  SPEAKER_00: And I always tell my favorite product of all.
• 2:44
  SPEAKER_00: I know.
• 2:45
  SPEAKER_00: I always tell the entrepreneurs uh that uh the best thing that can happen to you is when you run out of stock.
• 2:52
  SPEAKER_00: That's exactly what happened with Touchekla, because obviously we never expected such a huge success.
• 2:58
  SPEAKER_00: So after a few weeks, um, you know, every consumer was hunting for the product and we couldn't supply.
• 3:05
  SPEAKER_00: And that kind of created such a buzz.
• 3:08
  SPEAKER_00: So sometimes uh being out of stock is a good strategy.
• 3:12
  SPEAKER_00: Uh, don't plan it, of course, but uh if it happens, don't be too sorry.
• 3:16
  SPEAKER_00: Uh, it can uh mean that the product has a great destiny, and that's exactly what happened with uh with Tushekla.
• 3:24
  SPEAKER_02: Yeah, I think I put a dent in those uh running out of product.
• 3:28
  SPEAKER_02: I think I put a dent in it for in my own way because I used to stock up two or three at a time.
• 3:32
  SPEAKER_02: So I uh I really, really enjoyed that product.
• 3:35
  SPEAKER_02: I think a lot of us did.
• 3:36
  SPEAKER_02: I mean, um, any of you listening out there, if you're millennials, you know, because we loved I know.
• 3:42
  SPEAKER_00: No, it was sleek, it was it was almost a TikTok product before its age.
• 3:46
  SPEAKER_00: You know, I think if it had been launched now, it would be on TikTok every day because it was so sleek, it was uh something so handy that uh you had in your pocket uh or in your bag, and and it was it would do the job in a very in a very good way.
• 4:02
  SPEAKER_02: Exactly.
• 4:02
  SPEAKER_02: No, I I completely agree, you know, as a consumer, I completely agree.
• 4:05
  SPEAKER_02: That's exactly what it delivered for me, you know.
• 4:08
  SPEAKER_02: Um, it was, I think, one of the few products I've actually bought in the beauty, you know, space where I felt like all of the claims were delivered.
• 4:16
  SPEAKER_02: You know what I mean?
• 4:16
  SPEAKER_02: Like where they say, like, this is what's gonna this is what to expect.
• 4:20
  SPEAKER_02: That's was one of the hallmark products for me as a consumer where I felt like yes, it's delivering everything, you know.
• 4:27
  SPEAKER_00: It was also multitasking, you know.
• 4:29
  SPEAKER_00: I like that kind of uh versatile product which can do several things.
• 4:34
  SPEAKER_00: And uh it could be a corrector, but it could also could also replace uh a kind of a foundation on some point, or you know, kind of do a lot of things at the same time.
• 4:44
  SPEAKER_00: And in a beauty routine that is becoming more and more complex every day, I think anything we can do to keep it simple is actually very much loved by uh by consumers.
• 4:55
  SPEAKER_02: Absolutely.
• 4:56
  SPEAKER_02: I completely agree.
• 4:57
  SPEAKER_02: And I actually I want to ask you some questions because I know that a lot of, you know, I said it in the intro, a lot of people tune in that are, you know, entrepreneurs in the beauty space, you know, to the podcast.
• 5:07
  SPEAKER_02: And a lot of times the questions are around this exact topic, right?
• 5:12
  SPEAKER_02: Which is building obviously a brand, but then having that product that just goes viral, you know, it's something that everyone loves, really gravitate towards, you know, and so I guess a big question is how can brands really position their vision in a way that's going to speak to not only like consumers, but also, you know, from the the perspective of like funding and venture capital, like, you know, what it what does it really take to create a brand like a product like that?
• 5:41
  SPEAKER_02: I mean, if you can give some insight there.
• 5:44
  SPEAKER_00: Definitely in categories such as fragrance or makeup, yeah, um, color cosmetics, having a hero product um makes a big difference.
• 5:55
  SPEAKER_00: That's what changes the size of your business.
• 5:58
  SPEAKER_00: It's hard to predict.
• 6:00
  SPEAKER_00: You can't really say, okay, I'm going to create this product and it's going to be my hero product.
• 6:05
  SPEAKER_00: It happens, but uh, when you have it, it's uh it's a it's a shortcut to success.
• 6:12
  SPEAKER_00: In any case, uh, what I always advise um founders is to be careful with SQU extension.
• 6:21
  SPEAKER_00: Um, that's what often gets lost is the uh the cash flow needed to finance too many launches, too much stock, um, but be dead deadly for business.
• 6:32
  SPEAKER_00: So you need to be super, super considerate about what you launch, why you launch, and do as much testing, um, validation, a bit of crowdsourcing, maybe with your community.
• 6:47
  SPEAKER_00: I think nowadays there are lots of tools to avoid costly mistakes in launching a product.
• 6:53
  SPEAKER_00: You have uh you have your community, you can now even use AI.
• 6:57
  SPEAKER_00: There are lots of ways to reduce the risk of launching products, but it's so important to build a successful business.
• 7:05
  SPEAKER_02: Yeah, no, that makes sense.
• 7:06
  SPEAKER_02: It really makes sense.
• 7:07
  SPEAKER_02: And I think you made a very interesting point earlier about how you know the YSL product, it really was a multitasking product, and that really makes me think of how much the needs of consumers have shifted over time, you know, in the beauty landscape.
• 7:24
  SPEAKER_02: I mean, right now I think we're at a place where everyone's looking for that multitasking, multi-factorial kind of product that's gonna not only be great for beauty, right?
• 7:34
  SPEAKER_02: But it's also like a wellness product.
• 7:35
  SPEAKER_02: It's a, you know, it's a holistic approach, I think, to beauty.
• 7:39
  SPEAKER_02: And so I guess my question for you is how do you see that kind of shaping the landscape we're in right now?
• 7:44
  SPEAKER_02: Is this this idea of like combining beauty, wellness, and health, you know?
• 7:48
  SPEAKER_00: It's interesting.
• 7:49
  SPEAKER_00: I just posted something on LinkedIn today uh about uh slow beauty and whether we have reached a saturation point on, you know, how extensive a beauty routine can be for consumers.
• 8:01
  SPEAKER_00: Uh I think less is more in a way.
• 8:05
  SPEAKER_00: And maybe we are in the beginning of a cycle where it's a bit more minimalistic, a bit more practical, uh, a bit more economical, a bit more ecological, too, because obviously, you know, uh the more products you have and the more waste it uh it generates.
• 8:24
  SPEAKER_00: So um I do believe that um products that are at the at the border between categories, you know, makeup that can do skincare, skincare that can also um cover up your skin, um, fragrance that can also lift your mood.
• 8:42
  SPEAKER_00: Uh all these products that are not only multitasking but kind of bridging categories are super interesting uh because I think, yes, there is a bit of a glut of too many products, too many packagings, too much waste, and anything that we can do to uh simplify a bit our life and also uh manage our wallet is positive.
• 9:09
  SPEAKER_00: Uh so yeah, I hope that we are starting a cycle where we um we are a little bit more considerate.
• 9:16
  SPEAKER_00: Absolutely.
• 9:18
  SPEAKER_02: Yes, absolutely.
• 9:19
  SPEAKER_02: Yeah, I I agree.
• 9:20
  SPEAKER_02: And I think it's very interesting because for a long time I have felt that, you know, as a consumer, I felt that European brands have kind of led the way for these kind of changes.
• 9:32
  SPEAKER_02: I think that there's a lot that can be, I mean, how do you see that, right?
• 9:36
  SPEAKER_02: From your angle of like, I know you work on a global scale, you know, with the with the brands you work with and and the work that you do, it's a very global kind of thing.
• 9:43
  SPEAKER_02: And I'm curious, you know, if there is a brand that wants to expand in a meaningful way, what can they learn from the global market that could be adapted?
• 9:53
  SPEAKER_02: You know what I mean, even if it's like a at the beginning stages of their brand.
• 9:57
  SPEAKER_02: Like how could they really position it?
• 9:59
  SPEAKER_00: We have to recognize that um, you know, beauty is like food.
• 10:02
  SPEAKER_00: There are some worldwide products that everyone loves, but you also have uh local ways of eating and local ways of doing your beauty routine.
• 10:11
  SPEAKER_00: Uh, if you go to Korea, uh, you know, women uh have at least uh seven, eight products for their beauty routine in the morning, and then uh even you know, another another set of products at night.
• 10:24
  SPEAKER_00: You know, in the US, you have two types of consumers, uh super sophisticated women that uh love complicated routines, but also very uh practical consumers that prefer uh a few products only.
• 10:39
  SPEAKER_00: I think um Europeans are very much into moderation and a few products that do the job.
• 10:46
  SPEAKER_00: So it's it's hard to uh just decide that your brand is ready for worldwide launch.
• 10:53
  SPEAKER_00: When I advise uh brand owners, I always say that the most important is to plant a flag somewhere, usually on your home market, uh, because that's where uh you can find investors that are looking at your performance on your home market and in a very considerate way uh start expanding into international markets, but one at a time.
• 11:18
  SPEAKER_00: Uh, you don't want to be failing a market because it's very hard to come back.
• 11:23
  SPEAKER_00: If you think long-term and exiting your business, I always tell uh the founders that it's important to keep part of the dream for the new owner.
• 11:34
  SPEAKER_00: So you don't want you you keep some territories virgin because you will be telling that new owner that he, she, that company, that group can do the job of uh making the brand global.
• 11:51
  SPEAKER_00: So don't exhaust the opportunities of scaling the business because what you want to sell is exactly that opportunity uh with a new buyer.
• 12:01
  SPEAKER_02: That makes sense.
• 12:02
  SPEAKER_02: That makes a lot a lot of sense.
• 12:03
  SPEAKER_02: I mean, I think also, you know, a big question I have is, you know, we were speaking a little bit about the whole funding aspect, right?
• 12:10
  SPEAKER_02: For brands.
• 12:11
  SPEAKER_02: I think these days a lot of brand owners and entrepreneurs, they're always trying to get to a place where they're like, well, how can I get that initial, I guess, seed stage funding, you know, kind of secured and how can I appeal to investors?
• 12:23
  SPEAKER_02: And my question is, what are some basic steps?
• 12:26
  SPEAKER_02: You know, when there somebody is building a brand in the beauty industry, for example, you know, what are some steps they can take that right now, as you see it, that are really going to appeal to a lot of investors that are in this space?
• 12:39
  SPEAKER_02: I mean, are there any like uh trends that you've seen or or commonalities that are that investors are gravitating towards that they want to see in the emerging brands in the beauty space?
• 12:49
  SPEAKER_00: Yeah, that's a good question.
• 12:51
  SPEAKER_00: Um, I think there are steps and stages.
• 12:54
  SPEAKER_00: You have um key figures which um are important.
• 13:00
  SPEAKER_00: Uh it's like a hurdle race, right?
• 13:02
  SPEAKER_00: You you want to go through various stages.
• 13:05
  SPEAKER_00: I would say the first one million in revenues, whether it's in euros or in dollars um or in pounds is the same.
• 13:15
  SPEAKER_00: Reaching that first one million is is critical.
• 13:19
  SPEAKER_00: And nowadays, uh more and more you need to do it either with your own money or with your friends and family, because the time when you could uh raise money just on an idea is over.
• 13:33
  SPEAKER_00: So um it's very much your own efforts to get to that uh to that first one million.
• 13:40
  SPEAKER_00: And if if you do with limited expenses, that means that somehow you have traction, somehow you have found a community, or you have a hero product that is already appearing.
• 13:53
  SPEAKER_00: You know, there is something there that is appealing for going to the next stage, and then the next stage is five to ten million.
• 14:01
  SPEAKER_00: You usually need some money for that, which can be loans, combination of loan and some equity.
• 14:08
  SPEAKER_00: Maybe you start uh uh talking to um you know VCs or family office or high networks that uh can see the traction and can bet that you will build uh a successful uh business.
• 14:25
  SPEAKER_00: Uh and I do advise some of these brands, you know, when they are between five and ten million.
• 14:31
  SPEAKER_00: Right now I'm advising uh fragrance brand from Paris that is uh just going over 10 million.
• 14:37
  SPEAKER_00: And that's that's already a stage where you are profitable, where you have already extended your business worldwide, and and you are you know the future, future winners in terms of uh niche fragrance, for example.
• 14:51
  SPEAKER_00: So uh you can find financing there.
• 14:54
  SPEAKER_00: And then uh the next stage is you know 20 to 50 million, and that's when you're talking to uh private equity funds.
• 15:02
  SPEAKER_00: Uh here it's more a question of uh proving your organization is scalable, your business uh can grow.
• 15:09
  SPEAKER_00: It's more a matter of organization, capacity, reducing risks.
• 15:15
  SPEAKER_00: So uh the discussion is completely different because if you're already close to 20 million, you have a good product, uh, you have a good uh brand, you have a good communication, you've you've done something that is already in the radar uh of everybody, but uh you need to show that uh there will be no accident and that uh you know long term you can sell it to uh a large group, the L'Oreal and Loader and Fiseido of this world.
• 15:45
  SPEAKER_00: And that usually happens when the brand is around 100 million in uh in sales.
• 15:50
  SPEAKER_00: But you need to prepare your brand for that uh for that integration, which is uh which is tricky because uh moving from a founder-led business to uh a very organized uh company like uh a beauty group is uh is a big change.
• 16:08
  SPEAKER_00: And sometimes integration doesn't work.
• 16:11
  SPEAKER_00: So uh groups have learned to you know have a longer list of uh boxes to tick in order to decide on uh acquiring a brand that is uh in that uh in that scale.
• 16:23
  SPEAKER_00: So as you can see, it's it's different priorities along the road and sometimes different management.
• 16:31
  SPEAKER_00: Uh some founders are able to bring their brand all the way to 100 million.
• 16:37
  SPEAKER_00: Uh, rarely are they equipped or are they the best to then manage the brand with a group?
• 16:44
  SPEAKER_00: Uh, some founders have to stop at 10 or 20 million because it's a different ball game, and already they need uh a CEO that can organize a business.
• 16:54
  SPEAKER_00: I think that's where I actually advise a lot the founders because I've been faced with so many situations.
• 17:02
  SPEAKER_00: I often tell them not to rush when uh they want to consider some financing because uh you know it's like selling an apartment uh or a house.
• 17:12
  SPEAKER_00: You can do so much in improving the asset if you you know decorate it well, if you uh if you add the right room at the right place, there is there is a lot of work to be done before, so you need to anticipate any transaction you want to do.
• 17:29
  SPEAKER_00: And then the integration post-transaction is as important.
• 17:33
  SPEAKER_00: Uh, if you raise money, you will need to manage uh people that are on your on your board, that uh have views on your business, so you need to manage that.
• 17:43
  SPEAKER_00: If you are selling to uh an existing business, the integration is is is very important to succeed, and uh and that's exactly what I do.
• 17:52
  SPEAKER_00: You know, I advise before, I advise during, and I advise after.
• 17:57
  SPEAKER_00: I would also stress the importance of psychology.
• 18:00
  SPEAKER_00: We are in uh people's business, you know.
• 18:03
  SPEAKER_00: Uh beauty is not any type of business.
• 18:06
  SPEAKER_00: It's usually the founders of a lot of uh sensitivity, it's their child.
• 18:11
  SPEAKER_00: And whenever you consider a transaction, you need to think are these people going to go along?
• 18:18
  SPEAKER_00: Because uh, whether it's a financier or whether it's an uh it's uh it's an industrial partner, uh, rarely do you raise and go or sell and go.
• 18:28
  SPEAKER_00: It's a long-term collaboration afterwards.
• 18:31
  SPEAKER_00: And uh only if the psychology between the the buyer and the seller or between the investor and the founder works, only will you get the results and a shared vision really of what has to be done.
• 18:43
  SPEAKER_00: That's where I would say my gray hair and uh and wrinkles and having gone through so many deals and so many situations uh is useful.
• 18:54
  SPEAKER_02: Yeah, that that makes sense.
• 18:56
  SPEAKER_02: And thank you for providing that in-depth, you know, understanding because I think I get a little confused because sometimes I will see that a brand has sold, right?
• 19:05
  SPEAKER_02: And then oftentimes you'll see the founder they remain on the board or they remain somewhat in, you know, they're still connected to the brand in some way.
• 19:14
  SPEAKER_02: But do you think that that contributes at all to the image of the brand?
• 19:18
  SPEAKER_02: When a founder exits or you know, their role shifts, I mean, in terms of the community that they've created.
• 19:25
  SPEAKER_02: I mean, from your experience, have you noticed any kind of a change in in the sales of the brand at that point or you know, the way that it's uh being perceived?
• 19:34
  SPEAKER_02: I mean, it does it make a difference.
• 19:36
  SPEAKER_00: When a brand is sold to a large group, the large group um wants to retain the reputation and the knowledge of the founder.
• 19:45
  SPEAKER_00: And that's why a lot of times they're offered uh board roles or creative director roles, or you know, they are still there, and sometimes it works, sometimes it doesn't, to be honest.
• 19:59
  SPEAKER_00: Um, and sometimes it it fails to the point when the group sells again the business to the founder.
• 20:10
  SPEAKER_00: I'm sure you have seen some examples.
• 20:12
  SPEAKER_00: I'm not I'm not going to give examples here.
• 20:14
  SPEAKER_01: Yeah, no, I'm not sure.
• 20:15
  SPEAKER_00: But uh recently, recently there have been stories of uh brands that uh have been sold back for lower value, obviously, to the founder, because only the founder was able to understand you know the ethos, the the soul of the brand.
• 20:33
  SPEAKER_00: So we're back to square one, and uh it's up to the founder again to uh kind of relaunch uh his or her brand.
• 20:41
  SPEAKER_00: But yeah, I think if you know if the transaction has been well considered, if there is a good shareholders pact, if everything has been well sought out, I think a founder can collaborate very effectively with uh with a group.
• 20:55
  SPEAKER_00: It's a matter of organizing things in advance and managing expectations.
• 21:00
  SPEAKER_00: I think uh obviously when a founder is no longer the majority owner of a business, he or he or she can feel less accountable.
• 21:12
  SPEAKER_00: So you need to really think what are the things that the founder can still bring to the table?
• 21:18
  SPEAKER_00: And I think for many brands that are, you know, that have a very strong identity, where there has been uh a community built around the founder, it's important to keep some of that at least for a few years.
• 21:33
  SPEAKER_02: Yeah, that makes sense because I've seen a lot of times where uh I think older brands that I'm referencing, like you know, they, for example, sold, right?
• 21:42
  SPEAKER_02: And then you see that the products that are coming out now, like after they sold, are not the same in the sense that they're not res they don't resonate as much sometimes with their audience that they used to back when they, you know, before they sold.
• 21:57
  SPEAKER_02: And that's why I asked you that question, because I wonder why.
• 22:00
  SPEAKER_02: What goes behind that?
• 22:01
  SPEAKER_02: Because how can you go from like a, you know, you have two great products, right?
• 22:05
  SPEAKER_02: That are just viral products.
• 22:07
  SPEAKER_02: And then you sell your brand, and then all of a sudden maybe two or three more products are released or something, you know, new launches happened.
• 22:15
  SPEAKER_02: And those are not hitting the same, you know, they're not resonating the same way.
• 22:18
  SPEAKER_02: And it makes me wonder, you know, is it the vision of the founder that was missing there?
• 22:23
  SPEAKER_02: Or was it the guidance that was missing there?
• 22:25
  SPEAKER_02: I mean, what went wrong, you know, to where you went from like a really, really viral kind of, you know, set of launches now, eh, you know, kind of they're okay, but not as great as before.
• 22:37
  SPEAKER_02: So that's why I asked you that question because I've seen it many times where as a consumer, yeah, you know.
• 22:42
  SPEAKER_00: Uh look, I think it's um it's true uh that uh when uh when it's a founder-led business, um, the founder has a lot of authority and uh kind of decides which products to launch a bit on her own.
• 22:59
  SPEAKER_00: And maybe it it works or it doesn't, but it's usually with a point with a strong point of view.
• 23:05
  SPEAKER_00: These products have a strong point of view.
• 23:07
  SPEAKER_00: When uh the business is owned by a group, a lot of decision makers are involved.
• 23:13
  SPEAKER_00: So it looks more like a soup than uh a proper unique product because uh the risk needs to be diluted across many people.
• 23:25
  SPEAKER_00: And that's what happens when you know the brand is too big and uh there is not someone that is really behind the brand.
• 23:33
  SPEAKER_00: But it it happens not only when it's purchased by a group, but sometimes when the business gets bigger.
• 23:39
  SPEAKER_00: I think um, you know, let's speak about Glossier.
• 23:42
  SPEAKER_00: Glossier is still an independent brand, but I think it went through cycles where there was a little bit of um less character in some of the products that were launched.
• 23:54
  SPEAKER_00: So it's also a matter of size.
• 23:56
  SPEAKER_00: I remember discussing this with Anastasia, you know, Beverly Hills, when uh when she was going over 100 million, and and how to keep her drive behind the brand when so many people get involved, because uh you have a fund, you have teams, you have a CEO, and who makes the decision?
• 24:17
  SPEAKER_00: It's tricky.
• 24:18
  SPEAKER_00: But uh I think the longer the founder can stay at the helm and at least be in charge of the creative side of the brand, the better.
• 24:28
  SPEAKER_00: Uh the back office you can really delegate, and you you need a CEO that uh can take care of that.
• 24:35
  SPEAKER_00: But whatever is facing the consumer, in particular the product, I think uh when when the brand has a strong identity led by a founder originally, it's super important to keep that.
• 24:48
  SPEAKER_00: And you know, myself, uh in my in my life, I was managing uh fragrance brands uh such as um Thierry Mugler and uh you know uh Mr.
• 24:58
  SPEAKER_00: Mugler, the designer, wanted to create a fragrance called Angel, and obviously he had an incredible uh success with that fragrance.
• 25:07
  SPEAKER_00: And then uh when we discussed, because I was a CEO at the time, uh how to launch a second fragrance, and he was telling um our team that uh his name for a second fragrance would be Alien, and everyone around the table was saying, Oh my god, how are we going to launch a fragrance called Alien?
• 25:27
  SPEAKER_00: It's it's never going to work, it's impossible.
• 25:31
  SPEAKER_00: And you know, he stood firm, and and I I went with him, of course, and we and we launched a fragrance called Alien, and we and we did a second big success.
• 25:40
  SPEAKER_00: So this is typically uh you know a story where you don't want too many cooks um behind product creation in uh in the beauty space, especially in fragrance, makeup.
• 25:53
  SPEAKER_00: I think for skincare, uh hair care, there is more tech, there is more research, there is more science.
• 26:01
  SPEAKER_00: So it's probably more of a collective work, but certainly there are products where you know it needs to be the inspiration of one person.
• 26:09
  SPEAKER_02: I love the example that you gave.
• 26:10
  SPEAKER_02: You know, I think sometimes with brands like especially fragrance brands, it is really kind of a vision, you know, that the perfumer has or the mastermind behind the fragrance.
• 26:21
  SPEAKER_02: I mean, that vision is just you can't put them on the floor.
• 26:25
  SPEAKER_00: Fragrance is really close to fashion.
• 26:27
  SPEAKER_00: And in fashion, you don't dispute the creativity of a fashion designer that has a collection in mind.
• 26:35
  SPEAKER_00: Well, the same applies to fragrance, you know, especially when you're an indie brand.
• 26:39
  SPEAKER_00: Obviously, if you are Christian Dior and you're launching a fragrance, well, a lot of people need to be involved because the stakes are so high and uh you're reaching uh the masses.
• 26:50
  SPEAKER_00: But when you are in a in a niche brand or in an indie brand or a challenger brand like uh Mugler, you want something that stands out, and and the secret is to yes, to respect the intention of the artistic director that is behind the the brand or the founder in this case.
• 27:07
  SPEAKER_02: Yeah, that makes sense.
• 27:08
  SPEAKER_02: No, I'm I'm actually curious though, you know, what this conversation makes me think a lot about incubators because I've I think I have a misconception of what in like beauty incubators are, and I want you to like help me understand them because I think of it like, for example, you know, I interview a lot of skincare brands, right?
• 27:27
  SPEAKER_02: And I see a lot of skincare brands out here, and I see a lot of cookie cutter brands, if that makes sense.
• 27:33
  SPEAKER_02: Like I, you know, I feel like people are just creating brands sometimes, and it's not so much from this really unique vision and this really unique, you know, maybe scientific vigor or whatnot.
• 27:44
  SPEAKER_02: It's more of just well, this is a brand that, you know, is based on all these successes that we've already seen, you know, whether that's like the packaging type, whether it's you know, whatever that is, those parameters.
• 27:55
  SPEAKER_02: But how do you do you think incubators are a good idea for a person that wants, you know, to go in?
• 28:03
  SPEAKER_00: Okay.
• 28:04
  SPEAKER_00: Uh look, there were there are various various types of incubators.
• 28:08
  SPEAKER_00: Uh, you have the marketing incubators, you have the more science tech led incubators, and then you have the celebrity incubators.
• 28:18
  SPEAKER_00: So I can I can discuss the three.
• 28:20
  SPEAKER_00: Um marketing incubators is uh a team of people that think they are smarter than anyone else, and uh they're going to produce 10 brands, uh, hoping that one will succeed.
• 28:32
  SPEAKER_00: Sometimes it works if again, if there is talent.
• 28:36
  SPEAKER_00: Um, you know, DCM.
• 28:38
  SPEAKER_00: Um DCM was the you know the brainchild of uh of the founder of DCM, and uh and they launched several brands.
• 28:46
  SPEAKER_00: At the end of the day, the ordinary was the one that made DCM a success.
• 28:52
  SPEAKER_00: So I think when you are in this marketing mood, uh you need to be very clear that in the end the incubator will turn into one brand.
• 29:01
  SPEAKER_00: In fact, that's a little bit what happened also with a team uh in UK which launched uh Inky List.
• 29:07
  SPEAKER_00: Uh the Inky List was also one of several brands they launched, but very quickly they realized that the Inky List was the winning brand, and they kind of dropped uh other projects.
• 29:20
  SPEAKER_00: So you need that discipline.
• 29:22
  SPEAKER_00: When you are doing that, you need a very strong discipline of dropping um projects as soon as you see they're not going to be successful.
• 29:30
  SPEAKER_00: There are some incubators that are more driven by research, uh, science, uh, innovation.
• 29:38
  SPEAKER_00: Uh, I have collaborated with an incubator in New York called uh Ignite.
• 29:43
  SPEAKER_00: And um, and the founder comes from Johnson ⁇ Johnson, and um really is bringing all these connections with uh with science, technology, molecules, and and here I think it's interesting to uh to to share some back office to see which uh which brand will really uh take off uh because it's hard to predict.
• 30:09
  SPEAKER_00: So I think that model can work.
• 30:11
  SPEAKER_00: And then you have uh incubators that are more a platform for celebrities, because uh celebrities nowadays want to monetize their audience uh through their own brand, and we have seen some incredible successes to fast track the launch of a celebrity brand, uh relying on a team that is expert in uh developing and creating a brand can be a good idea.
• 30:35
  SPEAKER_00: Uh but here again, some will work and some will not.
• 30:38
  SPEAKER_00: So I would say mixed a mixed answer to your question about incubators, yes, but maybe we have enough incubators nowadays.
• 30:47
  SPEAKER_00: I think yeah, I think uh there are some good teams out there, and uh I'm not sure I would launch a new incubator now.
• 30:55
  SPEAKER_02: That makes sense.
• 30:56
  SPEAKER_02: Thank you for answering that.
• 30:57
  SPEAKER_02: Yeah, I I've always been I I mean, truly it was out of I asked you because I I genuinely don't know you know how they work, but that makes more sense to me now, where it is kind of like you know, trial and error kind of thing.
• 31:07
  SPEAKER_02: I mean, we do that in a lot in science too, right?
• 31:10
  SPEAKER_02: We we start like 15 experiments and hope to God that one works and gives us real data.
• 31:15
  SPEAKER_02: So it makes sense to me.
• 31:16
  SPEAKER_02: And I I think it's interesting to see them, you know.
• 31:19
  SPEAKER_02: Like whenever I see or hear talk of incubators, I I always find it to be very interesting because I think of it as almost like a big like gathering of data, you know, just like figuring out what the computer is exactly.
• 31:30
  SPEAKER_00: I think uh, you know, for exploring a new space, an incubator or an accelerator uh can be uh interesting.
• 31:38
  SPEAKER_00: Uh recently, um I came across uh an accelerator in Switzerland that is dedicated to longevity.
• 31:46
  SPEAKER_00: Um longevity is a new is a new space, but it's actually the convergence between uh beauty, wellness, health.
• 31:55
  SPEAKER_00: Um, you know, this idea that you can uh expand your your health span and not only live longer but live better, live healthier, live uh happier.
• 32:06
  SPEAKER_00: And there are lots of brands that are trying to launch uh concepts in that space.
• 32:12
  SPEAKER_00: So when it's a new category, I think uh trying many things and sharing experience across ventures can be a good model.
• 32:21
  SPEAKER_00: So that that accelerator called Maximum in uh in Switzerland uh is is doing exactly that.
• 32:27
  SPEAKER_00: And I think it makes sense uh because it's a new space.
• 32:31
  SPEAKER_02: Yeah, longevity especially.
• 32:32
  SPEAKER_02: I mean, it's such a multifactorial concept, you know, to create something that's truly a longevity product.
• 32:39
  SPEAKER_02: I mean, the science and the innovation that goes into that is very, very like multifaceted, you know, many organ systems are involved, the whole body is involved.
• 32:47
  SPEAKER_02: So that's definitely I can see where beauty, wellness, and health all need to come together to create a successful brand.
• 32:54
  SPEAKER_00: That's what makes it difficult because you need to speak to customers in a simple way about complex things, uh, and and find products which you know have uh potential to reach many customers, but yet are science-driven.
• 33:10
  SPEAKER_00: So uh it's a very exciting space.
• 33:13
  SPEAKER_00: I I have a personal interest in uh in longevity for many reasons, uh, maybe uh also because uh of my personal life now, but uh I am excited by trying to converge things.
• 33:26
  SPEAKER_00: I think uh, you know, having a more holistic approach to beauty and and merge it with with wellness, with health is uh is very exciting.
• 33:35
  SPEAKER_00: It's challenging, but it's uh it's exciting.
• 33:38
  SPEAKER_02: Right, it is exciting.
• 33:40
  SPEAKER_02: I agree, I totally agree.
• 33:41
  SPEAKER_02: I you know what's funny, uh July, I had interviewed like a longevity brand, like the first one I interviewed a long time ago, and I was talking to them about beauty, right?
• 33:51
  SPEAKER_02: And they were like, We're not we're not a beauty brand.
• 33:54
  SPEAKER_02: I'm like, I know, I know, you're not a beauty brand, but you are impacting a lot of consumers who are beauty enthusiasts.
• 34:01
  SPEAKER_02: You know what I mean?
• 34:02
  SPEAKER_02: Like it is about beauty at the end of the day, also.
• 34:04
  SPEAKER_02: It's not just about, I mean, I they were doing something where it was more of like a supplement route that they were taking, but it was interesting because they hadn't really thought about beauty.
• 34:13
  SPEAKER_02: You know, the CEO was not really interested in it.
• 34:15
  SPEAKER_02: Yeah, absolutely.
• 34:17
  SPEAKER_02: It's very cool, this space.
• 34:18
  SPEAKER_02: And and I'm excited to see what comes from it, you know.
• 34:21
  SPEAKER_00: Yeah, I think you know, if you if you realize that your skin is not only the way you look, but yeah, your skin is part of your body's immune system, it's your largest organ, it's what uh uh also creates a barrier between the environment and and and the inside of your body.
• 34:41
  SPEAKER_00: Suddenly this the skin, you know, um becomes much more important than what you initially thought.
• 34:50
  SPEAKER_00: And uh, and I'm very interested in you know in having that holistic view on uh the skin almost as a as a system, just like uh we now understand that the digestive system is connected to the brain, the skin is also connected to the brain, and so everything is connected, and I think future uh successful ventures will be connecting things uh across categories.
• 35:17
  SPEAKER_02: That's that's so cool that you said that because I agree.
• 35:20
  SPEAKER_02: I think, yeah, with the rise of this whole gut brain skin access conversation and so many more to come, you know what I mean?
• 35:27
  SPEAKER_02: I mean, it's gonna be a I think even more than that.
• 35:30
  SPEAKER_02: You know, the gut and the brain are great, but there's so much more like the heart, you know.
• 35:34
  SPEAKER_02: I mean, all the organ systems work together.
• 35:36
  SPEAKER_02: And I think it's really cool to see OTC products coming into this place where we're now bringing that level of scientific literacy to the masses, you know, and making people understand that your health is not just about one organ.
• 35:49
  SPEAKER_02: It's not just about one thing.
• 35:50
  SPEAKER_02: It has to be a more collective, concerted effort that we take as consumers.
• 35:55
  SPEAKER_02: And then also I'm I'm interested to see the VCs that get behind this, you know, and they really kind of invest in this vision.
• 36:02
  SPEAKER_02: Because I think, I mean, this is my opinion, I think that it's eventually going to integrate with um like pharmaceutical health, you know, products that we have.
• 36:10
  SPEAKER_02: Because at the end of the day, if in America at least, every single physician that I know, every colleague I have is of the viewpoint that there needs to be stronger effort on the part of medical practitioners as well as the business side, right?
• 36:25
  SPEAKER_02: Where people come together and realize we have to create more options for patients and consumers worldwide.
• 36:30
  SPEAKER_02: You can't just have this like one and done approach.
• 36:33
  SPEAKER_02: So that's where I feel like these kind of, you know, endeavors like longevity science and and bringing it into the OTC space, they really matter, you know, even in the scientific community, people are getting so excited about that and the clinical community.
• 36:46
  SPEAKER_02: So it's very, very, very interesting.
• 36:48
  SPEAKER_00: Um, it's interesting is that the pharmaceutical world wants to go OTC and the beauty world wants to go scientifically.
• 36:55
  SPEAKER_00: So they are they are starting to come together, and uh and we have more and more discerning beauty consumers that uh you know want to discuss science and claims and uh and formulation and ingredients.
• 37:10
  SPEAKER_00: So it's it's interesting what's what's happening, this convergence also of uh of the industries.
• 37:17
  SPEAKER_02: I completely agree.
• 37:18
  SPEAKER_02: Now I have one question for you that that comes up from this the rise of customization and personal personalized beauty products.
• 37:26
  SPEAKER_02: I mean, how do you see that from the standpoint of you know um trying to build brands like this?
• 37:31
  SPEAKER_02: Because I think a few have emerged, right, in the last like five years that I've noticed that are really kind of leading the way.
• 37:38
  SPEAKER_02: But um, you know, do you think that there's a big space uh for personalized brands?
• 37:43
  SPEAKER_00: Well, uh I always separate or differentiate customization and personalization because for me, customization is more you know, blending, a special ingredient, kind of doing your own formula but uh with a limited choice.
• 37:59
  SPEAKER_00: Personalization for me is when you really have uh your unique uh formula.
• 38:04
  SPEAKER_00: I think personalization in general is happening in every consumer category.
• 38:09
  SPEAKER_00: You know, if you think travel, if you think uh medicine, if you think food, uh we are all uh wanting and trying to uh personalize what we spend and uh what we consume.
• 38:23
  SPEAKER_00: Uh so beauty should be next.
• 38:26
  SPEAKER_00: We have seen a few brands, such as uh function of beauty or curology.
• 38:31
  SPEAKER_00: Um, I've been advising a brand in California called uh Proven, um, which is uh, you know, where they did a skin genome project, and then they uh they offer uh personalized, clinically effective uh skincare, which is formulated for you based on your skin, on the life and environment.
• 38:53
  SPEAKER_00: So um there are a few examples, usually premium or luxury, because it's hard to do personalization, true personalization at an accessible price.
• 39:05
  SPEAKER_00: Just the manufacturing of the personalized formula is is expensive.
• 39:10
  SPEAKER_00: Um, I don't think it's for everybody.
• 39:12
  SPEAKER_00: I think only a minority of consumers are into that type of product.
• 39:18
  SPEAKER_00: Still, a lot of consumers want to go for the uh Kiro product of a well-known brand.
• 39:24
  SPEAKER_00: But I uh I I see it growing, not only in uh skincare but hair care, uh, fragrance.
• 39:30
  SPEAKER_00: There is an appetite for having you know your own fragrance.
• 39:34
  SPEAKER_00: For me, it's uh it's a way to go.
• 39:37
  SPEAKER_00: I think in supplements, there is also a big need for uh more personalization.
• 39:43
  SPEAKER_00: Um it will take time, and I don't think it will be massive, but there is a space to be taken, and the early, you know, the brands that are early in that trend will be the winners because it it requires you to be very good at uh CRM, data management, but also manufacturing.
• 40:04
  SPEAKER_00: So you need to combine a lot of skills to have uh an effective, profitable, uh personalized uh beauty brand.
• 40:13
  SPEAKER_02: That makes sense.
• 40:13
  SPEAKER_02: That makes a lot of sense, and I think uh I'd be interested to see these brands that are focusing on customization, personalization.
• 40:20
  SPEAKER_02: I mean, either or both.
• 40:21
  SPEAKER_02: I I would love to see them integrate more with healthcare, actually.
• 40:24
  SPEAKER_02: You had brought up healthcare, and I think it would be really cool to see them uh truly integrate, you know?
• 40:32
  SPEAKER_00: One complication for these brands is uh how to manage distribution.
• 40:37
  SPEAKER_00: Um obviously they can do DTC, uh have their own e-commerce, it can be on e-commerce platforms, third-party e-commerce platforms.
• 40:46
  SPEAKER_00: But how about in-store?
• 40:48
  SPEAKER_00: How do you sell a personalized brand in-store?
• 40:52
  SPEAKER_00: Um, I've been working with uh with a brand called Ioma.
• 40:56
  SPEAKER_00: You know, they have put some machines in some uh stores in Europe, uh, proven as tried uh some kiosk in Sephora, but it's uh it's it's not easy to to get consumers to do a consultation in store and then order a product that by definition they will get uh only a few days later.
• 41:20
  SPEAKER_02: That's where I feel like doctors can help.
• 41:22
  SPEAKER_00: Honestly, you know, absolutely I think that's where all the data is.
• 41:26
  SPEAKER_00: The future of personalization might be with uh with skin clinics, with skin spas, with doctors.
• 41:33
  SPEAKER_00: I think that might be the channel.
• 41:35
  SPEAKER_00: Absolutely.
• 41:36
  SPEAKER_02: Yeah, yeah, that makes sense.
• 41:37
  SPEAKER_02: I mean, I I I'm excited to see that space, girl.
• 41:40
  SPEAKER_02: Honestly, I think it's really cool.
• 41:42
  SPEAKER_02: And you had brought up personalized uh medicine.
• 41:44
  SPEAKER_02: I'm a huge believer in personalized medicine, you know, and I think that um this would be really cool, like to see this come into that realm and and kind of take off there.
• 41:53
  SPEAKER_02: I mean, I I think there's a huge space there from my when I look at it from the clinical perspective.
• 41:58
  SPEAKER_02: I mean, we get we have all sorts of data on every patient, right?
• 42:01
  SPEAKER_02: As as doctors, like we know everything about patients.
• 42:04
  SPEAKER_02: And so to see a brand come in and then want to, you know, work with an a patient, right?
• 42:11
  SPEAKER_02: And then get them to understand the value of what they're providing, you know, rather than the typical, because even in medicine, there's only so many drugs we can prescribe.
• 42:20
  SPEAKER_02: There's only so many therapies, you know, they're all obviously proven, but there's limited options, and especially for people who have things like allergies, you know, sensitivities, uh, drug-resistant things, you know, there's a lot of room there.
• 42:33
  SPEAKER_02: So that'd be cool to see that.
• 42:35
  SPEAKER_02: But one thing I want to as a round out question I have for you, and this is for all the people listening in that might be brand founders, is understanding, you know, any advice you have about understanding your own space in the landscape of this industry.
• 42:49
  SPEAKER_02: I mean, what do you think people should keep in mind or entrepreneurs should keep in mind when they're looking at where their brand kind of fits into the overall picture of what we're seeing in the beauty and wellness space?
• 43:00
  SPEAKER_00: Well, they need to find their own space.
• 43:02
  SPEAKER_00: I think it's easier to build a business from a small niche where you are unique than trying to just copy and play with the big guys.
• 43:12
  SPEAKER_00: I think an element of differentiation which I'm very I'm very keen on is to be a responsible brand.
• 43:18
  SPEAKER_00: I see more and more funding requiring that box to be ticked, you know, whether you're a B-Corp or whether you are, you know, a clean beauty brand, sustainability.
• 43:31
  SPEAKER_00: You know, we this industry produces 120 billion packages a year.
• 43:35
  SPEAKER_00: And uh and most of them end up in landfills, right?
• 43:38
  SPEAKER_00: Or in the sea.
• 43:40
  SPEAKER_00: So whenever I work with an entrepreneur, I immediately ask, you know, what is your strategy on sustainability?
• 43:47
  SPEAKER_00: Because today I'm the one asking, tomorrow it will be uh consumers, and the day after tomorrow it will be investors, and you will never sell a brand to a group if it's not ticking boxes in terms of being recyclable or sustainable, or you know, you really need to make an effort on this front.
• 44:07
  SPEAKER_00: So for me, it's uh it's super important.
• 44:10
  SPEAKER_00: And then the key metric I always look at is repeat.
• 44:14
  SPEAKER_00: So whether it's repeat in a store, repeat online, converting a consumer is good, but converting over time is the key.
• 44:23
  SPEAKER_00: Once a consumer loves the product enough to buy back, you win because suddenly your lifetime value increases.
• 44:31
  SPEAKER_00: You can pay a lot for recruiting a customer if he or she is coming back.
• 44:35
  SPEAKER_00: And that's for me one of the key criteria is uh checking repeat orders in a store, looking at the cohorts and checking what is the behavior of the consumers you have recruited.
• 44:48
  SPEAKER_00: When I'm talking to investors, that's also what they are looking at.
• 44:52
  SPEAKER_00: And also the storytelling between the founder and the product, you know, it needs to be legitimate.
• 44:57
  SPEAKER_00: There must be a bit of authenticity and narration that uh resonates with uh with consumers.
• 45:04
  SPEAKER_00: I think it's it's super important.
• 45:06
  SPEAKER_02: It's great advice.
• 45:07
  SPEAKER_02: And I hope everyone tuning in.
• 45:08
  SPEAKER_02: I mean, if you are in the category of being an entrepreneur, you have your own brand.
• 45:12
  SPEAKER_02: I really hope that you've learned a lot from this episode.
• 45:14
  SPEAKER_02: Joel, thank you so much.
• 45:16
  SPEAKER_02: This was so informative and so helpful.
• 45:18
  SPEAKER_02: Even for me, you know, I don't have a brand, but I I learned so much from you.
• 45:22
  SPEAKER_02: So thank you so much.
• 45:23
  SPEAKER_00: Whenever you want to launch a brand, maybe we can speak.
• 45:25
  SPEAKER_00: I'll give you some.
• 45:26
  SPEAKER_02: Oh my gosh, you know, I'm gonna you're the first one I'm going to call.
• 45:32
  SPEAKER_00: I'm sure you have a potential there.
• 45:34
  SPEAKER_00: But uh, that's for another day.
• 45:36
  SPEAKER_02: I appreciate your confidence.
• 45:38
  SPEAKER_02: I know I I would definitely, you'd be the first on my list to call.
• 45:41
  SPEAKER_02: Like, Joel, what am I doing?
• 45:43
  SPEAKER_02: So thank you so much.
• 45:45
  SPEAKER_00: Thank you, and uh, I I thank all your listeners too for spending some time with us today.
• 45:50
  SPEAKER_00: Thank you.
• 45:51
  SPEAKER_02: Hey guys, so I hope you love that episode.
• 45:53
  SPEAKER_02: Please make sure to hit subscribe if you're tuning in to us on any podcast platform.
• 45:58
  SPEAKER_02: We are available on so many different platforms.
• 46:00
  SPEAKER_02: So wherever it is that you're tuning in, just go hit subscribe.
• 46:04
  SPEAKER_02: You will be immediately notified when we publish new episodes.
• 46:07
  SPEAKER_02: This way, you're able to tune in to amazing insights from experts, brand founders, industry leaders, authors, all the wonderful people that we host.
• 46:15
  SPEAKER_02: And that's very important for me because I love to hear from you guys and really understand what you love and what you want to hear more of.
• 46:23
  SPEAKER_02: Also, make sure to give us a follow on all of our social media outlets.
• 46:26
  SPEAKER_02: We're available on Instagram, TikTok, X, you name it, we're there.
• 46:30
  SPEAKER_02: We also have a blog on Medium.
• 46:32
  SPEAKER_02: So if you're a reader and you love medium blogs, check us out on Medium.
• 46:36
  SPEAKER_02: We publish some really great articles on there that do deeper dives than just what's available on the podcast.
• 46:41
  SPEAKER_02: And it's really a great place for all of you science geeks out there that want to learn a little bit more.
• 46:46
  SPEAKER_02: We go above and beyond with our research and making sure we're bringing you information that you usually probably won't hear about in other outlets.
• 46:53
  SPEAKER_02: So check us out, leave us a comment, leave us a review, and we'll be back next time with another episode.
• 46:58
  SPEAKER_02: Thank you.