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Inside Operations at Ipsy’s Parent Company

Ipsy is now part of BFA, which also includes Addison Rae's Item beauty and Becky G's Treslúce Beauty.

When Ipsy launched in 2011, the company focused on shipping full-sized beauty products out to big-time beauty enthusiasts. 

It was during an era when YouTube-based makeup tutorials were on the rise, including those by Michelle Phan, Ipsy’s founder. The company’s launch followed Birchbox, but Ipsy’s mission — “to inspire everyone to express their unique beauty” was different. 

“Our innovation came in two fronts. One is kind of this perspective that influencers really matter and are democratizing beauty…The other one that people don’t really talk about that much is, we were the first to have a beauty quiz,” said Marcelo Camberos, chief executive officer of Ipsy parent company Beauty For All Industries.

“You cannot subscribe to Ipsy in any way, shape or form, without taking a beauty quiz,” Camberos said.

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That information, combined with the company’s current 200 million product reviews, have allowed BFA to scale up a personalized subscription beauty company when others have failed.

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“We use all those beauty reviews and all that quiz information to personalize not just what you get in your bag, but your whole experience. Then we have to ship it to you within five business days,” Camberos said.

There are “10s of thousands” of Ipsy Glam Bag combinations, Camberos said. “We’re putting them all together in the warehouse and shipping them to you. That whole infrastructure, that’s where others who tried this, for example Sephora … one of the reasons they struggled is to personalize at scale and to operationalize all of that, that is not easy, that’s where we’ve been investing a lot,” Camberos said.

Ipsy’s competitors — like Sephora Play or Birchbox — have gone through multiple iterations and business troubles. In 2020, Sephora said it would wind down the Sephora Play subscription box offering in favor of “Sephora Favorite” sets of products, available at different price points. In 2021, after multiple retail expressions and rounds of layoffs, Birchbox was acquired by a health care company, and remaining cofounder Katia Beauchamp departed the CEO seat to become a strategic adviser to the business.

In 2019, Ipsy launched its first brand — Complex Culture, which makes makeup brushes. That brand-building division eventually became an incubator, called the Madeby Collective, which went on to launch influencer Addison Rae’s Item Beauty, and pop star Becky G’s Treslúce Beauty. The division also launched subscription personal care brand Refreshments, which sells shaving kits and body wash, among other products.

In 2020, the company acquired subscription competitor BoxyCharm. Together, the two businesses were slated to pull in more than $1 billion in sales for the year.

The business rebranded, and became BFA. BFA declined to share updated sales information, other than to confirm that sales in 2021 grew. The company also declined to share current subscriber counts for the Ipsy and BoxyCharm businesses. Camberos said that 2021 was a year that included internal reorganization as BFA’s different segments, especially Ipsy and BoxyCharm, integrated operations to become one company.

Some BoxyCharm employees were laid off around the time of the acquisition, and the company cut more Ipsy and BoxyCharm staffers in November 2021, Camberos said.

With the integration of BoxyCharm, some roles became “duplicative,” Camberos said.

“Whether it’s marketing team or brand partnerships team or engineers coding up the website, when you look at everything and as we all get on the same system, which we now are … there’s just redundancies that are created. It was more a function of bringing the teams closer together under one platform, under one roof,” Camberos said.

Ultimately, Camberos said the goal was to give brand partners a more seamless experience. Brand partners “wanted to talk to one person,” he said — “they didn’t want to get a call from Ipsy and a call from BoxyCharm to bring samples or bring in new products.”

“That’s an example of where we integrated and we can provide a better service,” Camberos said.

Now, the integrated beauty operation has raised $96 million led by TPG Growth, which first backed Ipsy in 2015.

“It was good timing with the markets being weak right now,” Camberos said. “That’s just a huge show of faith from our investors in our business, in our team, in our opportunity. And in a tough market environment, you want to raise as much money as possible so you can really go in aggressive and continue to grow.”

Moving forward, BFA plans to focus on further developing its technology and personalization capabilities, expanding retail distribution and international growth. The business recently launched operations in Mexico, and Rae’s Item Beauty debuted with Sephora in 2021.

Launching more brands is not high on the priority list, Camberos said. The company plans to spend $25 million supporting Black and Latinx-founded brands in 2022, and will look to launch Becky G’s Treslúce Beauty and Refreshments in retailers. BFA will also continue focusing on personalization.

“The better we personalize, the more people stick around and the more that people buy from us,” Camberos said.

“We’re going to take a little bit of a breather — we launched Refreshments, Item beauty, Treslúce and then we acquired BoxyCharm,” Camberos said. “Right now, we’re kind of more in consolidation, making sure we’re delivering we’re delivering a great experience across all those different areas.”


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