Now Worth $1 Billion, Beautycounter Aims to Take Big Leap
About a decade ago, Gregg Renfrew founded Beautycounter and started advocating for cosmetic makers to use safer ingredients. Back then, few people cared about what she was saying.
But now they do. So-called “clean beauty” has become a fast-growing category. And the company started by Renfrew, a former retail consultant, is worth $1 billion after Carlyle Group—one of the world’s largest private equity firms—bought a majority stake in April.
The brand, which is sold through its own e-commerce platform, a handful of stores, and an army of more than 55,000 independent sellers, says it avoids using chemicals that it deems unsafe. It has a list of 1,800 ingredients, such as formaldehyde. This includes 1,400 chemicals banned or restricted in personal care products by the European Union.
That mantra helps explain how it kept seeing sales rise last year when the beauty industry cratered during the pandemic. While growth slowed, revenue still gained about 17% at Beautycounter in 2020, according to Bloomberg Second Measure, which analyzes anonymous consumer transactions. The company, based in Santa Monica, California, declined to provide specific results.
Bloomberg recently spoke with Renfrew about the future of beauty, and what comes next.
Everyone is wondering if, and when, makeup will return. It helps that folks can ditch the masks, but what does a year of essentially no cosmetics mean for the category?
We will see a full recovery to makeup. I’m starting to see a lot of bold lips on Zoom. People who weren’t doing lip might be doing a little bit of eye. We may not go back to heavy contouring, but I do think we’ll see more color.
ResilienceBeautycounter increased sales last year despite the industry taking a hit
How did Beautycounter manage to grow when mask mandates and lockdowns rocked the industry? Your makeup sales sank, so how did you stay in positive territory?
While we were seeing a complete drop-in makeup, we helped people take care of themselves. And it wasn’t just skincare regimens. We saw people continue using tinted moisturizers and foundations.
The Carlyle investment more than doubled the company’s last reported valuation to $1 billion. What are you going to do with this cash infusion?
We’re well-positioned to rise and continue leading our industry. We see huge opportunities to enhance everything we do well today. At the core of that are an increased focus on digital capabilities and brand awareness.
You operate a handful of stores in major cities. Does that focus on digital means you’re leaning out of physical retail?
What we’re looking at now is how do you combine those four walls with Livestream shopping and broadcasting to a wider audience, creating content and interacting from a physical location in Los Angeles or New York. This interactive focus isn’t just the future of retail, but also e-commerce.
You started the company on the idea of cutting potentially harmful ingredients from beauty products. That’s expanded to Beautycounter—both you personally and the brand’s sellers—lobbying politicians to add more regulations to the industry. What’s been the impact?
We’ve been able to help pass nine laws over the years. We haven’t yet passed the federal law that we’re hoping to pass, but we do know we have bipartisan support.
Absent of that, Americans are still being subjected to toxic chemicals every day.
Editor’s note: This interview has been edited and condensed
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