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Ep.3: 6 Constraints, Biggest Chokehold-Beauty Brand

Beauty founder, accelerating your beauty brand has been a goal for quite some time now but have you wondered why your brand is still stuck at around or less than a million dollars despite having great products and raving fans? What if the biggest chokehold on accelerating your beauty brand has to do with you?

Fasten your seat belts, this is JumpStart, where Women-led early-stage beauty brands learn counter-intuitive insights to accelerate from approximately $1 million to $20M $200M without spending a fortune on ads, influencers, or retailers, with your host, Rohit Banota, founder of Toronto-based Jump Accelerator and an ex-P&G. 

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Okay, back to the biggest chokehold on your founder-led beauty brand. Maybe you feel that you started way before clean, natural, organic, etc., were a fad. But you are still there. And some of these brands came after you sailed way beyond $10M,$20M, or even $100M. 

You blame it on lack of support, connections, capital, or finding the right people that could have helped you hybrid grow your beauty brand. My takeaway from working with over three dozen beauty founders and speaking to approximately 500 Beauty founders is this. 

Maybe your beauty brand did not scale up, hyper-grow, or become that big, because you lacked the entrepreneurial hunger. You wanted it, but you did not have enough desire. You didn’t want it very, very badly. 

The biggest chokehold on your beauty brand is you. 

Let me show you how, for context, do watch or listen to my previous episode of the JumpStart podcast, which is about a four-jump sequence for hyper-growth: both science and emotion of hyper-growth for the beauty brand. 

Coming back to the biggest chokehold on your founder-led beauty brand. Let’s talk about the six constraints creating that big chokehold on your beauty brand’s hyper-growth. 

6 Constraints-Biggest Chokehold to Accelerate Your Beauty Brand

1. Cash Vs. Capital

1.Let’s start with the first constraint on accelerating your beauty brand. You will say it’s a lack of capital. But I would say it is a lack of cash management. By the way, coming to the capital, how many venture capitalists did you approach?

When I speak to a typical founder, they haven’t approached more than 2,3,4 or 5 at the max, like I said, target at least 40 to 50 different funds, whether they’re VCs or angels. Then, you got to study their thesis. Why do they invest? How do they invest? What kinds of portfolios do they have, and which are the brands in those portfolios?

And when I ask a typical founder to show me your pitch deck, it is rarely updated. Second, it is not customized by the venture capitalist that they’re trying to approach. And third, VC is just one of the options to raise money. The problem is that of cash, not just capital, but since we are talking capital, there are other ways. You can go to angels; you can go and look for government funds if your brand is sustainable, green, eco-conscious, etc. Or any other cause you’re trying to promote, even if it’s inclusivity, you can approach those government funds or organizations that champion these causes. You can also approach university funds and other accelerators and incubators that might help you with the money.

Find out the key contacts in these organizations, especially the ones where you can start developing some relationships, whether, with a gatekeeper or the final decision maker. Ready a pitch deck, a fundamental one, and then customize it by the VC or the Angel fund you’re going after.

As I said, it is not capital but cash. So how can you raise cash? There are three ways you can raise cash from your consumers.

Number one, announce a new product to your loyal consumer base, and involve them in the co-development of that product. Take advanced orders from your most loyal, hardcore tribe. And, once you take orders from them, leverage them to get advanced orders from the rest of your consumers. And finally, leverage advanced orders from both your superfans and your regular consumers for acquiring new consumers. This way you will be able to generate cash even before you started investing that cash in new product development. For example, Glamour Dolls founder, Jessica Romano, had a goal of $30,000 on Kickstarter, where she partnered with a designer by the name of Lisa Frank. She used this future design collaboration to raise money for the products that she’d be launching. As I said, she had a goal of $30,000, but she raised $370,000 from people who wanted those products. She did this on Kickstarter even though Kickstarter is not the best crowd-sourcing avenue for beauty brands.

Caveat on Accelerating Your Beauty Brand: 

You cannot blame your lack of progress, traction, or hyper-growth on capital.

2. Margin Vs. Price

The second constraint stopping you from accelerating your beauty brand, and these constraints are in your mind, is “you think about increasing the price or lowering the price to increase volume, and thereby make additional revenue slash profits.” Instead, you should be thinking of a margin-based strategy. Find out how your loyal consumers define quality because quality is in the eyes of the consumers.

Find out the top three drivers of quality for your loyal consumers. And then get rid of all those features of your products, brand, and business that do not take those drivers forward and enhance the features loyal followers want.

Caveat on Accelerating Your Beauty Brand: 

Pricing is not an absolute number, the context matters.

3. Hiring The Right People Vs. Only I Can Do It

The third constraint is the “only I can do it” mentality versus “hiring the right people.” What you have to do is hire the best people. Do not hurry. Every time you have an opening, instead of interviewing one or two, or three, or four or five people, at least interview 20 people for the job.

You have to hire people who are motivated by your vision, aligned with your values, are extremely hungry to succeed, and in the end, have the level of skills needed. You can teach skills, but for the rest three, you cannot teach anyone to become motivated by a vision, you cannot teach anyone the values that your brand stands for, your culture, And third, you cannot instill the hunger anyone has to succeed. So that’s why the order is critical.

How do you do it? You have to hire A-plus players. Use a technique called Topgrading, co-created by Brad and Geoff Smart. Create a job scorecard instead of a job description and it should have the purpose of your brand, outcomes, skills, attitude, and values you desire in the person.

Here’s my edit to top grading: take all of these four areas and combine them into a story within the context of a typical day in the job. And then, add a powerful hook as a headline for this job scorecard. Also, include the future, the role could have with the brand. For the interview, ready questions for each of these four areas: *vision, values, attitude, and skills. For each of these areas, you can have questions like these.

For example, to see the alignment with your vision, you can ask them what about your brand’s vision motivates them versus a competitor’s or another brand’s vision which is not your vision.
For the second area, which is your values, ask them for situations in their lives where they exhibited your brand’s values. When it comes to attitude, ask them about a challenging time they faced in their previous work assignment, it could even be a personal assignment, and how they went through those challenges. What were the trials and tribulations? How many times did they try? How did they try? What was their thought process? What actions did they take? And what were the results?

Somebody who has done it will be able to backtrack in an almost perfect sequence and arrive at the final victory, whereas somebody who hasn’t done it and was trying to make a story up will get stuck.

For the skill in the job, give them an actual on-the-job task and see how exactly do they go about doing that task? How result-oriented they are? and are they, in the end, able to achieve it? Interview 20 hire one.

For the interview, spend at least one to two hours for an entry-level hire to dig deep into their record around the four areas of purpose, outcomes, skills, attitudes and values. When it comes to a senior-level hire, spend at least three to four hours during the interview.

Caveat on Accelerating Your Beauty Brand: 

Taking your focus away from consumer facing functions.

4. Proven Learning Vs. Chasing Sales

The fourth constraint, paradoxically, preventing you from accelerating your beauty brand, is chasing sales versus proven learning. You should be able to establish and prove a cause-and-effect relationship between the fine-tuning you did for your product, your brand, or any initiative and the impact metric for the consumer, resulting in an impact metric for the brand.

For example, Drunk Elephant intends to reset their consumer’s skin with an ingredient elimination philosophy. How could they prove their learning? First, they’ll have to define metrics to measure the skin reset. So, for example, they could say skin health, you know, could mean the level of PH in the skin and sebum, etc. They could have a lack of skin irritation as a metric and measure the glow before and after using Drunk Elephant.

Once they have these metrics, whatever fine tuning they do, whether it’s in educating the consumer or in the product itself, should increase the consumers’ rating for the metric. And in the end, this positive tracking of the metric should result in loyal consumers buying more and in the ease of consumer acquisition for it to complete the loop of proven learning.

Caveat on Accelerating Your Beauty Brand: 

Chasing sales versus proven learning.

5. Velocity From The Shelf Vs. Open New Doors

The fifth constraint in the way of accelerating your beauty brand is opening new doors versus focusing on the velocity. Resist the urge to open new doors without focusing on a particular geography, particular type of retailers, and moving products from the shelf rather than just getting placement inside the store.

For example, Drunk Elephant did not sell to any retailer for two years. And after that, it signed an exclusive agreement with Sephora. Because of this focus, Drunk Elephant was able to direct all their resources to help the brand move from Sephora shells. Also, it got that much extra support back from Sephora because they knew the brand was exclusive at Sephora. Drunk Elephant went to $200 million with just one retailer. In contrast, I know, or I come across founders who have their beauty brands placed in every retailer possible: beauty retailers, specialty beauty retailers, department stores, etc. and salons and spas at times, and even health food stores across America and Europe. Some of these brands struggle even to do $5 million in annual sales.

Here’s a tip for you. Before you plan placement within a store or even demo inside the store, do a few demos outside the store in its catchment areas.

Caveat on Accelerating Your Beauty Brand: 

Lack of ownership for success inside the retail shop.

6. Systems & Processes Vs. Just Do It

The final constraint is the “Just Do It Mentality” versus “Building Systems and Processes.” Forget about functions and departments. Create inter-functional teams. Start backward from the end consumer and brand metrics you want to track positively. Forget about efficiency, but focus on effectiveness, especially as a startup beauty brand. You do not want to build things on time and within budget, which do not serve the ultimate purpose. If you don’t move the needle, it doesn’t matter if you did it within time or budget.

How? Identify three to five critical processes to help you deliver on the vital consumer and brand metrics and then work backward. To achieve those metrics, design processes to overcome the key constraint in these top three to five processes.

Focus on one to two processes per quarter. Not more than that. An example of a brand. Let’s say Drunk Elephant wants the skin sebum level to track positive. For that, the product needs to have a stable concentration of an impact ingredient, plus the consumer should be able to deploy the right amount of product for one particular usage. Then she should know how many times she has to execute this ritual for her skin sebum to track positive. And for this to happen, R&D, marketing, supply chain, and even the consumer education & the demo team must sit together and work out the process.

Create a process and then implement checks and balances in those processes. So that in the end, the consumer ends up using the right amount of the right product, which already has the right amount of ingredients in it, using it in the right amount every time and using it the correct number of times.

She has to be educated, for example, and in this case, the packaging guy can also be involved because the instructions will be on the packaging. They have to sit together and see how the consumer journey will take place, which are those places where there can be a gap. And how can each department contribute to overcoming that gap? In the end, once this goes to the market, they have to track the impact metric for consumers’ skin sebum and then see if it is tracking positively & whether it also is resulting in the ultimate objective, brand profitability. Is the consumer coming back to buy more or recommending more? Or is the consumer becoming more satisfied and thus buying more products from Drunk Elephant?

Caveat on Accelerating Your Beauty Brand: 

People working in functional silos rather than in inter-functional teams to achieve the ultimate objectives that will move the needle for the brand.


To summarize this episode on the biggest chokehold preventing you from accelerating your beauty brand, I explained six constraints that together form the biggest chokehold on your desire to accelerate your beauty brand:

1. Cash vs. Capital
2. Margin vs. Price
3. People Leverage vs Only I can do it
4.Proven Learning Vs. Chasing Sales
5. Velocity Vs. Opening New Doors
6. Systems and Processes vs. Only I Can Do It

All of these six constraints lie within the ears of the founder. It’s her mindset. That’s why the founder herself is the biggest chokehold on a startup beauty brand’s hyper-growth, or scalability.

*Vision= Core Ideology(Purpose + Values) + BHAG( Big Hairy Audacious Goal)

I have used vision & purpose interchangeably and have mentioned values separately to avoid going into details.

Thank you for listening. Please subscribe if you haven’t already. Take the quiz on how ready is your beauty brand for hyper-growth :  How ready is your beauty brand for hyper growth? 

Also, do not forget to submit your application to our next batch of Jump Accelerator to accelerate your beauty brand to $20M- $100M without spending a fortune on ads, agencies, influencers, or retailers: apply to our next month hyper-jump batch

We hyper-grow women-led, early-stage beauty brands using both science & emotion via an accountable solution.

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