Good Things In Small Packages
For the founders of e-commerce cosmetics hit Birchbox, success isn’t just a state of mind. It’s 300,000+ subscribers.
“It’s hard to remember that two years has been only two years,” says Hayley Barna, 29, co-founder of the cosmetics blockbuster, Birchbox. She and best friend, Katia Beauchamp, 30, launched the company in late 2010. Since then, their “insider access” to high-end beauty products grew from a notion in a New York bathroom to a Harvard Business School model to a multi-million dollar company.
The ladies still giggle like girls, but they command a white-hot venture. Birchbox has cornered the online, high-end beauty market with a simple but unique proposition: Women like to sample. (Men do, too, which is why Birchbox recently launched a masculine line.) For $10 a month, subscribers receive a box with four to five top-tier beauty products in sizes generous enough to last about a month.
Once the customer has sampled a sufficient range of products to generate a Birchbox profile, the goods are targeted to her, or him. In addition to the customized deliveries, Birchbox’s “360 degree” marketing platform offers online tips, interactive services and sales on full-size merchandise. Some 40 percent of users have purchased full-size versions from the online shop, which is operated in partnership with more than 400 brands, many of them names like Kiehl’s, Juicy Couture and Elizabeth Arden.
In the creation of this cosmetic success story, the eureka moment came, ingloriously, around February 2010, when Beauchamp was visiting her Harvard B-school classmate, Barna, at the apartment Barna shared with her best friend, Mollie Chen. Rifling through the medicine cabinet, Beauchamp came upon a hoard of beauty product samples. “Hayley was low-maintenance,” says Beauchamp, a slender, long-haired brunette. “So I figured the samples had to be from Mollie,” who worked as a senior assistant editor at Conde Nast Traveler. Chen became Birchbox’s first hire and is now the editorial director.
“This is what every woman wants, I thought,” says Beauchamp, “to have a beauty editor best friend.” Before they graduated in May, Beauchamp and Barna (smaller and more sharply etched than Beauchamp, but with the same billowing locks) used their harvard.edu addresses to email brand executives for help, like the CEO of Gurwitch Products, which distributes Laura Mercier, and the CEO of Benefit Cosmetics. Within days, Benefit became the first company to sign on.
The rudiments of Birchbox, which now has 140 employees, were readied over the summer, with a September launch comprising “emailing everyone we know,” says Beauchamp. “And once the first box shipped, we just talked and talked about it. We heard the voice of the consumer. We had a value proposition that cut through the clutter.”And they got course credit for it, too.
In October 2010, the company—which does not disclose sales figures—caught the eye of venture capitalists, garnering $1.4 million in seed money. It collected another $10.5 million in August 2011, according to the trade press. Where do the founders see it going? “Taking over the world,” says Barna.
“There’s so much more to be done,” she adds. Maintaining subscriber growth, fulfilling the new men’s line, building their international divisions. “I can see t-shirts and headphones,” says Barna, listing one clear idea after another. The headphones, she explains, could be a sample set tucked in a men’s box, along with other lifestyle or electronic goods. “Men like to discover, too,” says Barna. The corporate name, in fact, was born to conjure gender neutrality, says Kelly Herman, senior manager. Both founders share credit for the idea.
In September, in a move that expanded its footprint into Western Europe and gobbled up its competition, Birchbox acquired Paris-based Joliebox (for an undisclosed sum). Joliebox is several months younger than Birchbox and shamelessly pitched itself as the “French equivalent.” The younger startup acquired mirror service Boudoir Privé from the United Kingdom in December 2011, and Glamourum from Spain in February 2012.
“There’s no shortage of ambition around here,” says Barna, who grew up shoulder-to-shoulder with enterprise in Armonk, N.Y., the headquarters of IBM. Her parents ran a family business, manufacturing light fixtures, and Barna majored in economics and psychology as an undergraduate at Harvard, concentrating on behavioral economics and how people make decisions with money. She worked with Bain & Company, Christie’s and Amazon before heading to B-school, where, on the first day, she met Beauchamp. They clicked. “We sat catty corner to each other, and I checked out her nail polish,” recalls Barna. “From there, it was an organic process.” Beauchamp, who hails from Texas, spent Thanksgiving 2009 at Barna’s house, where the germ of an online subscription business began to grow.
“I wanted to work on something more entrepreneurial,” says Barna, “but I wasn’t set on going out on my own.” Beauchamp grew up in El Paso and graduated from Vassar College in Poughkeepsie, N.Y. (“my first experience on the East Coast”) with a degree in international studies and economics. Before Harvard, she worked in finance and commercial real estate. Birchbox presented the opportunity to parlay two of her favorite things: beauty and deals.
Beauchamp has been married for two years to Greg Beauchamp, whom she’s known since elementary school; Barna lives with her boyfriend of two years, Fredrik Maro, a Norwegian entrepreneur. “We’re definitely better friends now than when we started,” says Barna. “It’s like we’re married, with 140 kids.” Carving out separate niches—Beauchamp works more with the brand partners, Barna stays on the strategic side—they keep up the complement. “We’re very lucky to be totally aligned in the business,” says Barna. “We have different viewpoints but logic prevails.” Their closeness extends to private time. “We don’t see much of each other during the day,” she continues. “Katia’s out a lot, and I’m in meetings. We do get together on weekends. Last weekend I helped trim her [Christmas] tree, and we played a video game.”
Right now, the ladies are focused on building the men’s line with partners like the highly successful upscale grooming company, Jack Black. “It’s for a guy who’s looking to take things up a notch,” says Barna, whose older brother works for Birchbox, too. “It’s not about just the look, but knowing the details matter. He could be sporty, urban; Birchbox will match his personality.”
The model, as Barna says, is “not a demographic, it’s a state
Hair and makeup: Katsumi Matsuo; assistant: Takashi Ashizawa; styling: Cliff Hoppus; wardrobe on Katia: Serial Cultura top, Diesel vest, Iosselliani necklace; on Hayley: Diesel blazer, Billy Reid top, Bing Bang necklace, Michael Spirto ring.
American Crew daily shampoo and stimulating conditioner
Lucky Tiger face scrub, face moisturizer and organic lip balm
PRORASO shaving cream, The Knottery wool knit tie.
theBalm Mary-Lou Manizer
Oscar Blandi Pronto Invisible Volumizing Dry Shampoo
Kiehl's Creme de Corps
Juicy Couture by Juicy Couture
Miracle Skin Transformer Hydroactive Microderm