Beauty vlogger Michelle Phan has bagged $100 million for her make-up startup.
The company was co-founded by the popular YouTuber back in 2011 with former Funny or Die exec Marcelo Camberos and ex-Goldman Sachs analyst Jennifer Goldfarb – two veterans with a strong nose for business. Indeed, it once was called MyGlam, but has since been re-branded as the cleaner, cooler “Ipsy”.
The startup offers a subscription service to makeup fans, who can pay $10 a month to receive a parcel of beauty products from popular brands, such as Urban Decay. Sound familiar? That’s because it is going head to head with Birchbox, which offers a similar subscription service.
The corporate giant has already got $72 million in funding, which means the smaller contender has a large fight on its hands: until this month, Ipsy only had $3 million backing to its name. Now, though, Phan and co are going all in with a new round of funding that has raised $100 million to stash in the startup coffers.
Fortune reports that the deal values the company at around $800 million, with revenues set to hit $150 million this year from 1.3 million customers (on a rough pay with Birchbox’s 1 million-plus).
The funding – and valuation – marks the strong success of the subscription business model, which has benefitted everyone from Netflix and Amazon Prime to TASTE (a diferent cocktail every month), Cure and Simple (bacon to your door), Graze (snacks to your desk) and even Rubber of the Month (guess). But it also proves just how profitable a YouTuber’s influence can be, not just in terms of followers on-site, TV appearances or book deals, but in terms of cold, hard business cash: while many beauty companies sponsor vloggers, helping web celebs to make money that way, Ipsy is proof that YouTubers can be successful in the board room too.