In a world full of startups with big-name backers, it often surprises people when I tell them that I self-funded my skincare company. On one hand, self-funding your business usually means that your budget is a lot more limited than you’d like. But on the other hand, it keeps you accountable to make conservative and smart financial choices. Want to give it a shot yourself? Here are a few of the things I learned along the way that you can try.
When I first launched my business, I had only four products and a very basic website. While the product formulations were best in class, the website was a little lackluster. I learned to live with it, knowing that the quality of the products was far more important than the complexity of my website. Instead of buying a huge amount of products, I placed small orders. My cost of goods was high, but I was willing to take a smaller profit margin in order to grow sustainably. As my sales grew and my orders increased, my cost of goods went down and my profits soared.
When you’re starting out, try to focus on what’s going to be the most important to your customer and make it perfect. For me, that was my formulas, but for you, that might be branding, packaging or a tech experience. Then, let everything else be just OK until you have the money to make it perfect. If funds are tight, don’t be tempted to commit to huge contracts or stressful minimum orders. As you grow, your profits will increase. It’s OK to start small until you’ve built steady traction.
I’m a big believer in slow and sustainable growth. Being accountable to investors puts pressure on you to grow as quickly as possible. But because I was my own investor, I was able to make more conservative choices and focus on incremental monthly growth. Instead of dazzling my customers with new products every month, I kept communication going by providing them with a library of skin advice and content. That content kept me at the forefront of their minds for a relatively low cost.
It can be tempting to move really quickly when you’re starting your business, but you can build a sustainable profit flow by starting slow. Instead of focusing on new product launches, try to optimize what you have and build a relationship with your customer. Pulling the focus away from newness and toward your customer relationship will help you build the infrastructure you need to support future products.
Lead With Innovation
Many skincare brands launch with a full regimen of very basic products: cleansers, toners and moisturizers. If you have a lot of marketing money to spend, this can be a great technique since these products are used by almost everyone. But if you don’t have a lot of marketing dollars, it can be hard to build traction around basic products. A cleanser usually isn’t that exciting to beauty editors, and probably won’t gain a lot of organic traction. Instead, I decided to launch with four products that were a little unorthodox: two innovative serums, a self-neutralizing face peel and a micro-needling device. My customers would still have to get basics like cleansers and creams from another brand, but in the meantime, I was getting a huge amount of free exposure thanks to the inventiveness of my products.
To try this strategy yourself, look at your launch plans and ask yourself which product or feature is the most exciting and innovative. Then, push that to the front of your pipeline. Building your name around your most innovative product will help provide support for your other products later.
Build Your Cred
Launching my own skincare line was always the plan, but I started laying the foundation for my growth long before I had formulated even a single product. When I was still working as only an aesthetician, I began building my credibility in the industry. I seized every chance to do interviews and write articles, knowing that the more my name was out there, the more support I would have for my line when it launched. Say yes to opportunities that will help establish you as an expert in your industry.
Forbes Los Angeles Business Council is the foremost growth and networking organization for business owners in Greater Los Angeles. Do I qualify?
Partner With Press
The press has been an indispensable part of my company’s growth, thanks to the relationships I built with editors and writers early on. Before I launched my line, I invited beauty insiders to come down to my studio for a free facial. As I worked on their skin, we’d brainstorm ideas for articles and I’d offer them new angles on beauty trends. When it came time for them to write the piece, guess who they called first for a quote? It was a seamless symbiotic relationship — as I was helping them come up with new ideas, they were helping me with exposure. Beauty writers need content — if you have a new take on something, they’re into it! Once it came time for me to launch my line, I had already built close friendships with a wide network of editors and writers who were eager to support me in my next venture.
Getting a hold of editors and writers can be a challenge, but social media makes it easier than ever. When in doubt, I offered editors free treatments to start the relationship. These are people who are constantly solicited. Try to think about what perks you can offer them in the beginning, and then approach it like any friendship — put the work in and you’ll see it come back to you.
The biggest lesson I learned from self-funding my business? Don’t compare your company to those backed by lots of funding. While some have a lasting impact, I’ve seen a lot of beauty companies launch with a bang and fizzle out shortly thereafter. It’s like the old parable of the tortoise and the hare: Right out of the gate, it may seem like fast is best, but in many cases, slow and steady wins the race.