Last year, the market research Euromonitor estimated more than a quarter of all new brands were in the beauty and personal care category. With the beauty industry a drop in the bucket of the larger consumer space—people spend more on their pets than they do on beauty products, for example—it’s not surprising that large numbers of beauty brands fail.
Yet, when a brand as high profile as Ami Colé closes, it’s shocking. Its founder Diarrha N’Diaye-Mbaye had the “right” professional background. She was previously a social media manager at Temptu and L’Oréal and a product developer at Glossier. It had the “right” investors. L’Oréal’s venture capital fund BOLD, True Beauty Ventures, Imaginary Ventures, Greycroft, Debut Capital and others backed it to the tune of around $3 million in funding.
It had the “right” retail partner. In 2022, Ami Colé entered Sephora in the Next Big Thing displays, where the retailer presents and tests emerging brands, and by 2024, moved beyond the displays to 600 doors. At the time, N’Diaye-Mbaye told Beauty Independent the brand was approaching $3.5 million in annual sales.
Still, Ami Colé will cease to exist come September. N’Diaye-Mbaye attributes the closure, at least in part, to the very real difficulties of being a Black entrepreneur, particularly in the post-DEI era, budgetary constraints in a market where the bill for capturing attention is ever-increasing, and the pressures and expense of scaling at Sephora, where its competition has greater firepower. (See Rhode’s up to $1 billion payday in advance of its launch at the retailer later this year).
In a piece for The Cut last week, N’Diaye-Mbaye wrote, “I invested heavily in marketing and prayed. But I couldn’t compete with the deep pockets of corporate brands; at retail stores, prime shelf space comes at a price, and we couldn’t afford it. As we tried to grow, our sales wavered. We made operational decisions that felt necessary at the time — like scaling up production to meet potential demand — without truly knowing how the market would respond. One week we’d be completely sold out because an influencer mentioned us; the next, we’d be stuck with inventory we couldn’t move.
Instead of focusing on the healthy, sustainable future of the company and meeting the needs of our loyal fan base, I rode a temperamental wave of appraising investors — some of whom seemed to have an attitude toward equity and ‘betting big on inclusivity’ that changed its tune a lot, to my ears, from what it sounded like in 2020.”
For this edition of our ongoing series posing questions relevant to indie beauty, reflecting on Ami Colé’s impending shutdown, we’re diving into what it takes for a makeup brand to realistically make it in big-time retail. We asked 11 cosmetics entrepreneurs, consultants and investors the following: What unique challenges do makeup brands face when trying to gain traction in the market versus beauty brands in other categories? What sort of funding would it need to successfully enter Sephora or Ulta? If you were to create a makeup brand today, what should it have to give it the highest chances of success?
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Ashunta Sheriff Founder and Makeup Artist, Ashunta Sheriff Beauty As a Black woman, makeup artist and founder who’s been bootstrapping my beauty brand from the beginning, I can tell you firsthand that launching and sustaining a makeup line in today’s climate is not just about having a great product, it’s about surviving a system that was never built with us in mind.
Makeup brands face unique challenges compared to other beauty categories. While skincare and haircare allow for slower education-based growth and build over time, makeup is instant, visual and trend-driven.
You’re not just selling performance, you’re selling an experience, an aesthetic, a culture. And that means constant reinvention, faster launch cycles, heavy influencer partnerships, costly sampling programs and rapid scaling, all without the kind of capital most indie founders, especially Black women, ever have access to.
Launching a makeup brand in 2025, realistically, requires $250,000 to $500,000 just to bring a few SKUs to market with strong branding, packaging, formulation and marketing. But if you’re talking about making a true retail run—getting into a Sephora or Ulta, meeting their margin requirements, building inventory, hiring a sales team and executing a launch plan that competes next to celebrity-backed brands—you’re looking at $2 million to $5 million in funding, minimum.
Let’s be real: Most Black women–owned brands never get that kind of capital. We bootstrap. We sell at pop-ups. We show up at trade shows. We pour into our community, create educational content, go live and engage daily just to maintain visibility. And, yet, when retail or VC opportunities do come, we’re often met with scrutiny that brands with less innovation, less experience and less soul simply never face.
Ami Colé’s closure isn’t just about one brand. It’s a gut-punching reflection of what happens when even the best of us—award-winning, press-celebrated, mission-led brands—cannot sustain in a market that refuses to invest in or protect our place. DEI isn’t a trend to us, it’s our reality. But, in 2025, with DEI no longer a hot commodity, many of us are now navigating the quiet fallout: reduced support, retracted partnerships and silent doors closing.
Add to that tariffs, international shipping delays, rising costs of ingredients and the political tensions affecting overseas manufacturing, we’ve had to reroute entire operations just to continue production. These are pressures most brands don’t talk about publicly, but they’re real. And for those of us without a cushion of venture capital or celebrity endorsements, it can feel like we’re always one major disruption away from collapse.
To succeed today, a new makeup brand must have:
- Deep authenticity that reflects culture, community and modern needs.
- Strategic product differentiation. Not just new colors, but true utility or innovation.
- Built-in storytelling that goes beyond marketing. It must be mission-led, but commercially viable.
- A lean but sharp digital strategy where community meets conversion.
- Operational resilience to withstand global and domestic market instability.
But, even with all of that, we need funding. We need ownership of the platforms that sell us. And we need the right rooms to open the right doors, not just temporary campaigns during heritage months.
I’ve learned, through painful missteps and hard-won lessons, that alignment in partnerships is non-negotiable. The wrong alliance can shift how the world sees your brand and how you see yourself. But I’ve also learned that we are built to evolve. Every setback has only sharpened my clarity and deepened my purpose.
Ami Colé was a beacon. And while this chapter may be closing, the message remains: Black women in beauty are not a trend. We are a force. And we will continue to build, even if we must do it without the fanfare, without the funding and without the applause.
We deserve better. And we’re not done.
- Manica Blain Founder, Top Knot Ventures
Color cosmetics is one of the most capital-intensive categories in all of consumer. It’s easy to underestimate just how difficult it is to start a makeup brand, let alone scale one in retail.
For founders who care about inclusivity—and I mean truly care about it—there’s immediate pressure to launch with a meaningful range of shades. That’s not just a moral imperative, it’s also a reputational risk if you don’t. But the working capital required to do that well is massive. You’re not launching five SKUs, you’re launching 20, 30, maybe even 40 shades and across multiple categories.
Therefore, relative to other subsegments of beauty like skincare or haircare, the SKU count alone of a color cosmetics brand results in a much larger investment in inventory, including packaging and componentry, which means way more forecasting complexity and ultimately a greater burden on early cash.
Retail, while an incredible validation point, can become problematic for early brands if not timed carefully. It’s significantly expensive to support and maintain. The trade spend, sampling, the merchandising fees, the cost of being “retail ready,” that can easily burn through a $3 million to $5 million seed round before the brand even gets a chance to stabilize.
Over the last three years and through Top Knot Ventures, I’ve directly invested in 14 companies, six of them are beauty brands, and most are either or both Sephora and ULTA partners. All but one of these six brands has raised more than $3 million in capital so far.
What I’ve learned is that, within beauty, that kind of capital isn’t a luxury, it’s a requirement. So, when a founder enters color cosmetics, with the pressure of inclusion, a rollout into 600 Sephora doors, and only $3 million raised, it’s not just hard, it’s structurally stacked against them.
And here’s the tougher and very timely truth: Exits in color cosmetics have been scarce. When marquee brands like Rare Beauty, Makeup by Mario, Kosas, Saie, Westman Atelier and Merit haven’t yet produced clear exits, it creates a chilling effect on the entire category. Investors get spooked. Capital becomes cautious. The bar for success gets impossibly high, and yet founders are expected to clear it with less.
If I were building a makeup brand today, I’d do three things:
- Launch with a tight, high-impact hero product that has margin and emotional resonance.
- Build a small, obsessed community before ever stepping into a big-box retail conversation.
- Underwrite for the long game. That means patient capital, but it also means discipline. Not all attention needs to convert into expansion both from a channel perspective and an assortment perspective.
I can’t speak to what happened at Ami Colé, a beloved brand that seemed to have all the “it” things: top-tier early-stage consumer/beauty investors, the beauty retail partner of choice for brand-building, cult-like product love and an engaged and loyal community (actual text from one of my best friends, Phoebe Wang, when the news broke, “I can’t believe Ami Colé is shuttering. I really like her brow gel”), and, finally, a fiercely driven founder with a wildly impressive background and with grit and tenacity that transcended every interaction, leaving no doubt she was building something bigger than herself.
The closure of a brand like Ami Colé isn’t a cautionary tale about one founder. It’s a spotlight on a broken system and the harsh economics of building in one of the toughest categories in beauty.
- Kim Baker Founder and Makeup Artist, Glamazon Beauty
The makeup category is deceptively glamorous, but, behind the scenes, it’s a blood sport. It’s SKU heavy, capital intensive and brutally competitive. And it’s uniquely complex. Skincare has routines. Fragrance has notes. But makeup demands shade accuracy, a deep understanding of undertones and finishes and a high level of consumer trust. That’s why breaking through takes more than just a good product, it takes strategy.
If I were launching a makeup brand today, I’d focus on three things:
1. Know your why
Consumers are smarter than ever, and the barrier to entry is low. They’re being sold hundreds of beauty products a week. But most brands still lead with aesthetics instead of answers. To win in today’s market, you need more than great packaging and a viral moment.
You need to stand for something, solve something and show up with clarity. That’s exactly what we’re building at Glamazon, a brand rooted in simplicity, performance and practical functionality. We don’t chase trends. We build systems that make makeup make sense.
2. Real funding
To play in retail, you need serious capital, and $5 million to $7 million is just the minimum to get in the game. That may cover inventory, chargebacks, sampling, warehousing and fulfillment, but you still need capital for staff, field teams, education, marketing, etc.
Even high-profile influencer brands show how much it takes. Luxury Brand Partners invested $10 million to launch Patrick Starrr's One/Size, and the company raised $50 million to support its portfolio. Makeup by Mario raised $40 million. That is the level of investment it takes to compete and stay in major retailers like Sephora.
3. A community that buys, not just follows
Hype is cute, but conversions pay the bills. You need a community that aligns with your point of view, believes in your products and comes back to repurchase, especially in makeup, where trust, performance and consistency matter more than ever.
There’s a running joke in the industry: The foundation girl is loyal, but the lip gloss girl likes to sleep around. Complexion is where the relationship starts, and where it lasts, if you get it right. The strongest brands are the ones that turn first time buyers into repeat believers.
Because at the end of the day, it’s not about launching more SKUs, it’s about launching with purpose, precision and staying power.
- Divya Gugnani Founder and Co-Founder, 5 Sens, Concept to Co and Wander Beauty
I don't believe makeup brands face fundamentally different challenges than skincare or haircare brands, they're all fighting the same brutal battle for consumer attention and wallet share. The core issues are universal across beauty: intense competition at every price point, rapidly dwindling brand loyalty, shrinking consumer attention spans and the relentless pressure from mass brands that can undercut prestige pricing while delivering comparable quality.
Every brand is competing for the same real estate, both physical shelf space and digital feed space. The barrier to entry for makeup is somewhat lower than skincare, which in today's market really requires consumer testing and clinical studies to establish credibility. But the barrier to sustainable success is actually enormous. Unlike skincare, where efficacy can create genuine differentiation, makeup often becomes a commodity where marketing muscle matters more than product innovation.
There's a massive difference between launching a makeup brand and launching one that can survive prestige retail. You can bootstrap a makeup brand if you're genuinely focused on building community and telling your brand story organically. I've seen founders do it with under $50,000 and smart educational social media strategy.
But if your goal is Sephora, you need to be realistic about what that requires. I'd estimate $1.5 million to $3 million minimum to get started and demonstrate real traction, with the understanding that you'll likely need significantly more to accelerate growth post-launch.
This isn't just about product development, it's about having adequate funding for the 360-degree marketing support that prestige retail demands. Sephora is an amazing partner, but brands also need to coordinate their marketing activities to tell their own story on their own channels and further support sales for their products at Sephora.
The exact number for funding varies dramatically based on your distribution channels, margins and go-to-market strategy, but underfunded brands struggle with growing at retail and end up missing opportunities that require funding. Without sufficient marketing dollars to drive velocity, brands can end up taking up shelf space temporarily.
Here's what makeup brands should do to have the highest chances of success:
Focus above all else. The brands I see succeeding have an obsessive focus on one hero product or a tightly curated collection rather than trying to be everything to everyone. Successful brands built their reputation on a few perfectly executed products.
A genuine point of difference beyond demographics. Being clean, sustainable or for a specific age or racial demographic isn't enough of a moat anymore. These are table stakes, not differentiators. You need a unique reason for being that goes deeper than checking demographic or ingredient boxes. What problem are you solving that nobody else is solving in that exact way?
Ruthless consumer focus. Instead of trying to appeal to all women 18 to 65, pick your exact customer and become indispensable to her. Build for the specific, not the general.
Sustainable unit economics from day one. Too many founders get seduced by vanity metrics and growth-at-any-cost mentality. I've experienced this as a founder and an investor and have learned the hard way that strong unit economics are critical from day one.
- Jennifer Ritter Founder, JSR+CO
Makeup as a category requires continued dedication and timed investment. It’s not just about beautiful colors or a one-time use product, it’s about cutting through a crowded market where trends dominate with products that drive lifetime repeat purchases.
Makeup is instant unlike skincare, where loyalty builds as results appear with consistent use. Makeup brands need immediate cultural traction, which takes heavy investment in formula, product marketing, content and community-building. Without that, even the most innovative ideas struggle to survive.
To launch a makeup brand today, I’d say you need at least $1 million to $3 million and closer to $5 million to $8 million if you’re partnering with retailers like Sephora and Ulta. It’s not enough to simply get on shelf, you must fund the product funnel, lean into marketing, field support and visibility required to move product. Retail is a pay-to-play environment, and unless you’ve built demand ahead of time, you’ll get buried by brands with bigger budgets.
The brands that win share four things:
- A point of view that’s timeless (lasts more than three yrs), a mission and ethos people truly connect to beyond just inclusive or clean.
- Launch with a tight curated collection of products that work together and keep customers coming back, building repeat purchases instead of one-off sales. Knowing what your 18-month calendar is helps and ensure these products strategically align.
- Operational support without strong operations brands crumble.
- The discipline to grow smart, not fast, focusing on sustainable demand before chasing big retail moments.
- Patricia Valera Founder, Beautybrandr
Makeup brands face uniquely intense pressure compared to other beauty categories. To start, they require a much higher number of SKUs, substantially increasing complexity and costs related to product development, manufacturing, inventory control and merchandising.
And unlike skincare or haircare, which often benefit from stable hero products, makeup consumers expect continuous novelty—new shades, finishes, and limited editions—just to stay in the game. All of this means more cash tied up in inventory and a higher risk of sitting on excess stock.
One smart tactic I would recommend for makeup brands is to carve out a micro-niche—owning one product category or packaging format such as lips or eyes or a single format like sticks or palettes, which helps streamline production, inventory and costs.
* Nudestix launched successfully by focusing entirely on multi-purpose sticks.
* Subtl Beauty utilizes a single, versatile (stackable) packaging component.
* Juvia's Place initially concentrated solely on eyeshadow palettes.
* About Face has really made its mark with wands.Sephora and similar large retailers, despite their appeal, are notoriously demanding. When it comes to retail, the focus shouldn’t be on launching, it should be on sell-through and staying power.
Getting in is just the beginning. Staying on shelves and driving consistent long-term sales is the real challenge. The financial and operational investments brands must make after securing shelf space can be staggering and often unsustainable for indie brands.
Retailers that claim to champion indie brands need to rethink what support really looks like. Accelerators are a great start, but they don’t address the realities of in-store survival. If they truly want indie brands to succeed, they need to offer meaningful, ongoing support. Better margins. Accessible marketing programs. Flexible payment terms.
There may also be value in creating dedicated retail environments where smaller indie brands aren’t pitted against billion-dollar machines. From what I've seen, retailers like Ulta and Credo have had the best track record when it comes to supporting emerging indie brands at earlier stages.
While's it's an iconic destination, Sephora shouldn’t be a short-term goal for most indie brands. In my opinion, it would be strategically advantageous to delay entry into high-investment retailers like Sephora until annual revenue is over $5 million with a deep well of working capital, so that a brand can weather the pressure without breaking.
Let's not even get into the chaotic economy over the last five years where indies have been trying to survive in a market that keeps changing the rules.
That brings me to the elephant in the room: venture capital. The demands of VC money can accelerate failure just as quickly as it can scale success. Sometimes growth is not the answer. It’s critical to have the flexibility to scale back or pivot when necessary, both of which become much more difficult when outside money is involved.
- Tara Cohen Founder and CEO, Mixst
I’ve spent over 20 years in this business. I’ve been the person building brands from scratch, turning concepts into products, managing operations, negotiating with retailers and doing everything in between because I had to. I’ve worked with celebrities, dermatologists, scientists, makeup artists and founders who knew beauty inside out, and those who didn’t know anything at all.
I’ve been in the room for the pitch decks, the product picks, the shade development meetings and the marketing plans. I’ve also been there when brands had to quietly pull back, shelve ideas or shut down completely. I’ve developed my own brand ideas too, only to pause them because I knew what it would really take to scale and sustain in today’s market.
Why Makeup Is the Hardest Category in Beauty
Makeup is not skincare or haircare. It’s trend-driven, influencer-driven and fast-moving. Loyalty is harder to build. You’re only as good as your last launch or your last viral moment.
And launching makeup isn’t cheap. It’s increasingly harder to differentiate and hard to get the consumer to understand the difference, let alone your investor. The minimum order quantities and the inclusive shade ranges will already put you in the red.
Here’s a conservative reality check for anyone considering entering the space today:
Stage Estimated Cost (Minimum) Concept, R&D, Packaging, First Production Run $500,000 to $1 million Marketing (Paid Social, PR, Influencers, Content Creation) $500,000 to $2 million (annually) Retail Expansion (Sephora/Ulta fees, fixtures, returns, co-op marketing) $1 million-plus commitment Operational Support (People, Logistics, Inventory Management) $300,000 to $800,000 annually Total Minimum to Scale to Major Retail $3 million to $5 million-plus That’s just to launch. It’s not to win.
The Founder Funnel: A, B, C and D Teams
Across the brands I’ve worked with, there’s a pattern to who succeeds and who fails:
A-Team Brands
These brands are led by founders with built-in followings. They’re makeup artists, influencers, celebrities or people with deep social media reach and consumer trust. They have connections, capital and teams that know how to execute. When the formula is right, the product is good, and the marketing hits, this team wins.
B-Team Brands
These founders still have a shot. They might be emerging creators, semi-known names or niche experts who have something new to say and real expertise. They can absolutely succeed, but they need discipline. They need to manage budgets wisely, assemble the right team and deliver consistent newness to stay in the game. They have to balance creativity with business acumen and build both a product and a business at the same time.
C-Team Brands
These are often run by people with some beauty experience or business knowledge or not at all. They overcomplicate the process, overthink or run out of steam before they find their lane. They pivot too often or not enough. Some get caught chasing perfection, and some freeze after an initial push because they can’t figure out their next move. This is where things start to stall.
D-Team Brands
This is where brands truly lose their way. Sometimes it’s internal. The team starts to fracture, focus shifts, and people begin to care more about protecting their own workload than building something lasting. Internal struggles drain energy and distract from the mission. Other times its strategic: The brand miscalculates its target audience, positioning as prestige, but attracting mass or speaking only to the beauty industry echo chamber while forgetting to connect with the actual consumer.
Some D-Team brands build too fast, spending early on celebrity agencies, top-tier PR and large internal staff before the revenue is there to support it. They burn through capital trying to keep up with perception rather than focusing on profitability. They get caught up in the hype cycle but miss the mark with the customer.
Others fall into the inventory trap. They over order to make the numbers look good, but they can’t move the inventory. They sell out of hero products too quickly, but take too long to restock because of long vendor lead times, poor planning and not enough capital for the large minimums. Consumers lose trust. They get frustrated, move on and may not come back. Brands that can’t keep hero products in stock lose momentum fast and in beauty, that’s hard to recover from.
Retail Expansion: The Sink or Swim Model
Retail can make or break a beauty brand. Getting into Sephora or Ulta feels like winning the lottery but it’s often the start of a much tougher game.
Retailers don’t always have the capacity to nurture every new brand equally. The bigger names may get the prime shelf space and the top account teams. New indie brands often get passed to the newer, less experienced internal teams. Founders must fight for time, space and support. They constantly have to come up with creative ways to stay relevant, but at what cost?
I’ve seen brands give away thousands of units to participate in retailer marketing boxes or GWPs, with no real clarity on ROI. These activations are exciting but rarely calculated in the initial business model, and they can strain finances and operations if not carefully managed.
Post-COVID, lead times are longer, and tariffs are higher. Vendor minimums are larger. Brands need to have capital in reserve to fund reorders, or they risk going out of stock at the exact moment they should be building momentum. Selling out sounds like a good problem, but, when it takes six months to come back, you lose consumer trust and often, you lose the customer.
The Inclusivity Reality Check
Let’s also be honest about inclusivity and niche marketing. The segment of underserved consumers, particularly Black and brown women, has been historically ignored by the beauty industry. That is a real and important gap to fill. And, yet, when you zoom out to total market scale, these segments are still considered “niche” by the major investors and retail partners who are chasing mass-market numbers.
Does that mean minority-owned brands have no shot? Absolutely not. Look at Briogeo, Fenty, Live Tinted, Juvia’s Place and Honeypot. That said, it does mean the road is longer, the capital needs are greater, and the expectations are different.
Many founders underestimate this. They don’t always account for the marketing costs, operational demands or retail expansion challenges required to scale a brand that serves a specific audience within a mass framework. They face additional scrutiny, different pressures, and, in many cases, a consumer base that wants representation, but can’t always sustain multiple new brands at once.
Once you get that first check or that shelf space at your chosen retailer, you stop being a passion project and become a business. And businesses are expected to perform. Quickly. Consistently. Under pressure.
And here’s the hard truth: Not every consumer sees themselves in every brand, no matter how well intentioned the mission. Some consumers see themselves in a Rhode lip gloss because of sheer cultural ubiquity and social aspiration. But not everyone will see themselves in a niche beauty brand, even if the formulas are better or more thoughtful. Sometimes it’s just a numbers game.
What I Tell Founders Now
After working with so many startups, celebrity brands, indie brands and science-backed brands, here’s what I tell every founder I work with today:
- Start lean. Keep the assortment and team tight. Stay focused. Keep costs low.
- Understand your audience. Build for someone specific, not everyone.
- Know your pricing strategy. Make sure your price aligns with your value proposition.
- Work with startup-friendly vendors. Negotiate minimums. Control lead times.
- Keep cash in reserve. Plan for reorders before you even launch.
- Invest in the right marketing. Pick marketing that converts, not just marketing that gets attention.
- Don’t expand too fast. If your infrastructure can’t support it, you’ll break.
- Build the right team. Hire people who care about the brand winning not just their workload or title. This also includes picking the right investor partners (and I know sometimes you don’t have a choice).
- Get your operations right. Hire operational people who can manage cash flow, inventory and supply chain.
- Have a champion by your side. Someone who will challenge you, not just yes you.
- Stay close to your customer. Invest in data and feedback. Don’t just play to the beauty industry echo chamber.
- Stick to your North Star. If you try to be everything to everyone, you’ll end up being nothing to no one.
Failure, Lessons and Smart Business
I don’t believe in failure. I’ve been knocked down many times, and I’ve always gotten back up. That’s how this industry works. You learn. You adapt. Sometimes you pivot, and sometimes you walk away. Smart business is better than no business.
The Ami Colé story isn’t just about one brand. It’s about an entire industry reckoning with how we build, fund and sustain beauty today. For those dreaming of starting a beauty brand today, it’s possible, but it’s not simple. And it’s not for the faint of heart.
If you’re still ready to do it, I’ll see you in the trenches.
- Mehir Sethi Founder and CEO, Luscious Group
I’ve been in the color cosmetics/makeup business for the last two decades, operating in markets across Asia, Europe and the U.S. I watched with some skepticism the gold rush when makeup brands, often launched by insiders without deep product or consumer experience, were funded and fast-tracked to market at unprecedented speed. There was a belief that a good founder story, even without operational credibility, and Red Antler-level branding were enough to build a successful business.
In the race to stand out, the pressure to differentiate led to gimmickry. “Makeup you can sleep in” or cursory nods with ethnic shade names were applauded by VCs and retailers alike. But this kind of positioning eroded long-term consumer trust. It diluted what the makeup category fundamentally promises: performance, artistry and innovation. Even the once-powerful narrative of, “I couldn’t find a shade for me, so I made one,” rang hollow
Makeup is a game of endurance, execution and constant innovation. Brands like IT Cosmetics have thrived, even after their founder’s exit, because they built trust around efficacy, not just storytelling. Problem-solving, quality and consistency matter more than ever.
In fact, I’d argue the current slowdown in makeup sales at retailers like Sephora is, in part, the result of this wave of manufactured brands. Too many launches, too little substance and too much noise have fatigued consumers.
To win today, a makeup brand must offer more than a vibe. It must offer value—visually, emotionally and functionally—and deliver it with precision again and again. A straight launch in Sephora or Ulta without time gaining customers and community and product iteration is simply not sustainable.
- Melissa Hibbért Founder, Beauty Founders Agency and Emerge Beauty Innovation Studio
When I first read about Ami Colé’s closure in The Cut, I had to sit with it for days. I didn’t want to get caught up in the emotions—and there are profound emotions here—due to the thousands of social media posts from others rightfully lamenting this loss.
But as someone who works with indie and emerging beauty founders every day all looking for my perspective, I know this moment demands more than sentiment. It demands honesty about what we’re truly facing in this industry.
When speaking with countless founders, the vicarious trauma is real! When a high-profile brand like Ami Colé—with its “right” background, “right” investors (L’Oréal’s BOLD, True Beauty Ventures, Imaginary Ventures, Greycroft), and “right” retail partner in Sephora—closes after raising over $3 million and reaching 600 stores, it sends shockwaves through our community. Founders see themselves in Diarrha N’Diaye-Mbaye’s story and wonder, if a brand built on legacy, purpose and genuine intention to help women of color look and feel beautiful can’t make it, what hope do the rest of us have?
N’Diaye-Mbaye herself wrote that she “couldn’t compete with the deep pockets of corporate brands” and that “prime shelf space comes at a price” her business couldn’t afford. This isn’t just about one brand, it’s symptomatic of systemic challenges that go far beyond individual business decisions.
Understanding the Nuanced Reality
From a business standpoint, Ami Colé’s situation reveals the unique pressures facing VC-backed brands. The rules are different when you have investors expecting hockey-stick growth and specific return timelines.
N’Diaye-Mbaye described riding “a temperamental wave of appraising investors—some of whom seemed to have an attitude toward equity and ‘betting big on inclusivity’ that changed its tune a lot” from what it sounded like in 2020.
The retail behemoth challenge is real. During Sephora's Spring Savings Event (April 4 to 14), makeup and haircare sales were reportedly down approximately 15% in both stores and online, while facing increasing competition from more than 1,000 new points of distribution that have opened in the last three years. For emerging brands, this means fighting not just for shelf space, but for visibility in an increasingly crowded marketplace where established players have significantly deeper marketing budgets.
We’re experiencing what I call “the great reset,” where we’re returning to value-driven beauty like never before. Consumers still desire quality, beautiful, and accessible products, but they want better value. As one industry executive noted, “Consumer behavior is starting to shift as consumers increasingly focus on value and become more cautious with their spending.”
The Unique Challenges Facing Makeup Brands Today
1. Inventory volatility: As N’Diaye-Mbaye explained, “One week we’d be completely sold out because an influencer mentioned us; the next, we’d be stuck with inventory we couldn’t move.” This unpredictability makes production planning nearly impossible for smaller brands without the buffer of deep-pocketed backing.
2. Rising operational costs: With current tariffs potentially as high as cost of goods and expensive marketing requirements, the financial pressure is unprecedented.
3. Retail partnership pressures: Slotting fees can range from $5,000 to $50,000-plus depending on retailer size, with wholesale pricing typically 30% to 50% lower than retail prices, adding significant cash flow challenges.
4. Marketing cost escalation: Retail media networks are expected to grow to $166 billion by 2025, representing 20% of all digital media spend, making visibility increasingly expensive.
What Does Really Takes to Launch a Makeup Brand Today?
My assessment aligns with current industry data on launch costs:
Minimum viable launch (MVP): For a lean start with one to two private-label products and basic online presence, budget $5,000 to $15,000-plus.
Standard direct-to-consumer launch: A robust DTC launch with three to five custom formulations and professional branding requires $20,000 to $70,000-plus.
Full-scale launch: For comprehensive market penetration with proprietary formulations and custom packaging, budget $100,000 to $400,000-plus.
The Funding Reality for Retail Success
Black-founded beauty brands raised only $16 million in 2024, making up just over 5% of funding for the U.S. beauty industry, declining from $73 million and nearly 10% in 2022. This funding environment makes retail success increasingly challenging.
From what I’ve researched, a realistic Sephora or Ulta run, brands need:
• Minimum $500,000 to $1 million for initial retail partnership costs, slotting fees, and marketing support
• $2 million to $5 million for sustainable growth and inventory management
• $5 million-plus to compete effectively with established players for prime shelf space and marketing visibility
If I were creating a makeup brand today, it would need:
1. Laser-focused differentiation: Not just “better,” but genuinely different, filling a specific gap that improves upon existing solutions.
2. Sustainable business model: Direct-to-consumer foundation with retail as expansion, not primary revenue source.
3. Community-first approach: Authentic engagement that builds brand loyalty before and beyond product launches.
4. Financial discipline: Conservative growth projections with flexible inventory management and multiple revenue streams.
5. Strategic patience: Understanding that sustainable growth takes time, even in today’s fast-paced market.
While we mourn the loss of Ami Colé—a brand that won over 80 industry awards and was featured in Oprah’s “Favorite Things”—we must acknowledge the broader systemic issues. This isn’t about one founder’s decisions or one brand’s strategy. It’s about an industry that preaches inclusivity while remaining structurally challenging for the very brands trying to serve underrepresented communities.
The beauty industry has always been resilient, and it will continue to be. But we need honest conversations about the real costs—financial, emotional and systemic—of building sustainable brands in today’s landscape. Brands launching today do have advantages: broader consumer awareness, fewer truly differentiated products in the market and more sophisticated understanding of direct-to-consumer strategies.
But they also face unprecedented challenges: the dreaded tariffs, higher ingredients and components costs, increased competition and a funding environment that has become more risk-averse, particularly for minority-owned businesses.
As N’Diaye-Mbaye beautifully concluded, “I still believe in beauty—at every level—and I’m looking forward to discovering what comes next.” So do I. The future of beauty lies not in following old playbooks, but in creating new models that are both financially sustainable and genuinely inclusive, not just in marketing speak, but in practice.
The industry owes it to founders like N’Diaye-Mbaye and to all the founders still building to have these difficult conversations and create real pathways to success, not just moments of viral attention followed by quiet closures.
- Alicia Scott Founder, Range Beauty
Being in color cosmetics is incredibly tougher than any other category in beauty. It's expensive and requires immense marketing, which requires significant capital. Smaller brands that create in this category mostly do so because of the large oversight we see from bigger brands, and we are doing it on shoestring budgets to truly provide a solution for our respective communities.
Not only do you have to consider the costs to cover production and inventory (often at high minimum order quantities per shade), but you also have to think about how you will get the word out about every shade (ideally, but often not realistically).
A popular beauty brand on everyone's radar sends out at least 1,500 PR packages a month. This is additional inventory (that you're letting go for free), shipping expenses, team and time that a brand has to account for, but this is how you see them everywhere.
You simply cannot compare a beauty brand with $3 million in investments across four years to a brand that started with millions plus a strategic VC partner from day one. Investment-heavy brands have a massive budget and well-versed team, dumping dollars into every cool PR kit, gifting moment, in-person activation, celebrity collabs, paid ads, influencer campaigns, photoshoots, etc. You need most of this to sustainably and profitably scale when there are 10 new brands or products dropping a day.
However, this isn't the only route. You can keep your brand smaller and focus on building your DTC or keep it to boutique retailers and establish a smaller footprint, building outside of big retailers. There are different paths. Retail is not the end-all be-all for some, and the investment needed truly depends on which path you want to take and who you want to reach.
- Danny Stein Business Consultant and Co-Owner, Cinema Secrets
In my experience, after over 40 years in the beauty industry, when brands raise significant funding and expand quickly, especially into a major retailer like Sephora, it often comes from a “grow fast, exit fast” mindset. That usually means not enough focus on profitability, operational discipline or long-term planning.
I’ve seen brands lose focus, overspend and take advice from the wrong people. Too often, they chase retail before they’re ready. I always tell founders: Don’t chase Sephora, build something strong enough that Sephora chases you. But reps or agents often push hard for that early Sephora placement, chasing a commission or a short-term win. That pressure rarely serves the brand well in the long run.
This is the kind of work I like to help with as part of my consulting. And, honestly, I see many other issues here that are better saved for a longer conversation. But I’ll say this, a brand like this likely could be saved. Most just can’t see the right path to a turnaround when they’re in the middle of it.
As for the broader questions—how much funding does it take to launch a brand and make a Sephora or Ulta run? There’s no one-size-fits-all number. It depends heavily on your strategy, your margins, how much is done in-house, whether you’re building DTC first or retail-first, and, most importantly, having the right people around you.
When it comes to traction, especially in color cosmetics, the challenge often comes down to direction. What’s your goal, and what’s your message? Unfortunately, today, messaging matters more than quality, though both are obviously important. If your story doesn’t land, the product won’t either.
If I were to create a brand today, the highest chance of success would come from a strong brand story and a clear plan around who is behind the line and how that will support the marketing. A lot of founders skip the basics. With over four decades in the beauty industry, I’ve worked with fantastic factories that already have excellent formulas, but many people don’t understand what’s really needed to make a product sell, or they don’t know the right factory to work with in the first place.
And it all comes back to strategy. Are you building fast to exit or building a business for generational wealth? I ask founders this question often, and I’m always surprised how many don’t have an answer. Quick exit or generational wealth? If you don’t know which path you’re on, it’s very hard to make the right decisions along the way.
If you have a question you’d like Beauty Independent to ask beauty entrepreneurs, investors and consultants, please send it to editor@beautyindependent.com.
