How Experts Think Emerging Beauty Brands Should Build Teams In A Profit-Focused Market

Ambitious emerging beauty brands are facing cross-pressures when it comes to building their teams. On the one hand, as we explored in a No Stupid Questions story earlier this month, they’re being advised to bring in C-Suite executives sooner than ever before to help them navigate a challenging market with a competitive advantage. Of course, executives can be expensive, and on the other hand, they’re being advised to focus on profitability and keep their teams lean.

Against the backdrop of these cross-pressures, for the latest edition of our ongoing series posing questions relevant to indie beauty, we asked 16 beauty investors, consultants and entrepreneurs the following questions: For typical emerging beauty brands today, how big should their team be at various stages? If such brands were to make hires beyond the founder, what roles do you think they should fill first?

Daniel Faierman Partner, Habitat Partners

Team construction should largely be catalyzed by business milestones that increase operational complexity, often driven by channel expansion. For example, a 100% DTC business could operate with fewer than four full-time equivalents (FTEs) and perhaps a few fractional contractors all the way to material scale, even a $15 million-plus run rate.

Conversely, as a brand transitions from DTC-only into a national retail rollout in a Sephora- or Ulta-esque retailer, inventory management (cash conversion cycle) and sales execution become far more complex. As a brand becomes materially omnichannel, bringing on a director of operations and a director of sales and maybe one to two direct reports for each may become essential.

Furthermore, in a world in which a roughly $7 million to $10 million-plus brand that is predominantly DTC successfully raises growth equity to fuel rapid retail expansion, it may be the perfect moment to have a tough conversation with your board about one's ability as a CEO.

In certain cases, a CEO may be an incredible brand builder or chief creative, but daunted by the thought of building a high functioning team to manage thousands of distribution points profitably. Taking a step back into a chief brand officer role and bringing in a serial CEO who has taken a brand to exit could be fruitful for all parties at a time when your balance sheet is padded for a temporary increase in burn.

Alta Sparling Fractional CMO and Growth Strategist

There is no one-size-fits-all approach to building a team, but I do see three distinct phases in a brand's growth that informs preferred skill sets at each one.

For example, post a brand's initial go-to-market, you're still assessing product-market fit, but in order to set yourself up for success, you need to ensure you have the following bases covered at a general level: operations, marketing and product development. To keep costs down, the founder/CEO will likely take on product development and some parts of marketing, but having a marketing generalist and ops lead can help you get through this first stage.

Once you've surpassed $1 million in topline revenue and have consistent traction, then you want to start considering investing in roles that tie directly to demand. This means leaning into ops further, including customer experience. You may need to invest in a planning consultant who can help the founder think through SKU demand, purchase order placement and making sure you're getting ahead of critical lead times, especially if you're considering retail expansion. A team at this juncture might include: a founder, ops lead, part-time customer experience manager, marketing manager and product development consultant.

If the founder is considering raising outside capital, I do think finding a fractional head of finance to help plot out the forecast, assumption and potential equity scenarios is essential. It's a shame when founders don't get their ducks in order financially before kicking off the fundraising process. Having a partner to navigate terms and set plausible growth expectations can do wonders to protect equity.

Following a seed round or other influx of cash, the senior leaders start to roll in—and for good reason! At this stage (depending on how much you raise), founders are in the best position to start considering more senior leadership both fractional and full-time.

Here is when fractional C-Suite leaders can be game changing since they come in with experience knowing how to scale, grow and lead teams and also bring true expertise in areas where the founder has likely been a generalist up until this point.

Similarly, this is when hiring experts across the team can accelerate growth, for example, a social manager, retention lead and a growth agency. It's at this point when the mix might look like two to three fractional leaders, one to two agencies (growth and/or PR), two to three marketers, two to three in ops and planning, and two to three other product specialists.

Hillary Solomon Strategic Advisor, Indie Beauty Growth Advisory

Emerging beauty brands must navigate balancing both growth and profitability while strategically scaling an organizational structure that will support its expansion. There is no universal blueprint for determining the optimal team size at various growth stages. Founders should hire key roles based on fundamental business needs rather than predetermined revenue milestones.

To build an effective team, I suggest founders should:

• Assess their own strengths and capabilities
• Identify functional and operational gaps
• Prioritize the most critical roles crucial for growth
• Let the business model and distribution strategy guide hiring decisions
• Leverage external resources and outsource where appropriate

I think it’s best to build a lean, resourceful and agile team focused on execution from the start, tapping leaders who are willing to both strategize and work hands-on and are not afraid to be scrappy to get things done.

Size of team at key stages of growth:

When evolving the organization, I recommend using the P&L as a guide. Aiming to keep total compensation costs, including benefits, under 20% of revenue, using this as a directional guideline. However, early-stage brands may need to spend slightly higher as they scale.

• Pre-launch to $1 million: founder plus one to three key roles
• $5 million: assuming an average full-time employee cost, including benefits, of $150,000, the approximate team size would be five to seven full-time employees.
• $10 million: 10 to 13 FTEs
• $15 million: 15 to 20 FTEs

In my view, the goal should be to stay as lean and efficient as possible, maximizing funds to fuel business growth. Overinvesting in personnel can leave insufficient resources to drive the business forward. There's no point in hiring staff if you can't invest marketing dollars to grow the top line.

As the brand builds critical mass, team expansion typically slows. At this stage, all essential functions are covered, the existing team can support growth across channels and compensation expenses should decrease as a percentage of revenue.

Key roles to fill beyond the founder:

Assuming the founder manages product development, and the brand has a DTC business with plans to launch in retail, key roles to consider filling first include a lead for each function. These roles will initially function as single person departments with the expectation of team expansion as the company scales.

• Marketing: Brand/product marketing, content creation, social, influencer, PR, paid media, brand activations.
• Ecommerce/digital: Brand.com, retailer.com, Amazon.com, social commerce, performance marketing, site merchandising, web content development, customer acquisition and retention, CRM, email marketing.
• Operations: Demand planning, procurement planning, supply chain management, inventory control, fulfillment, quality assurance, day-to-day business operations, customer service.
• Finance: Financial planning and analysis, reporting, budgeting, cash management, AP/AR.
• Sales: Retailer relationships, account management and planning, sales forecasting, new business development, education, sell-in/sell-through.

Regardless of the role, founders should seek individuals who are functional experts, can execute efficiently, wear multiple hats, get their hands dirty and help bring their brand vision to life!

Cristina Nuñez Co-Founder and General Partner, True Beauty Ventures

Building out teams is one of the biggest decisions and uses of limited resources for a startup brand. As with most things, there is not a one-size-fits-all-formula. It always depends.

One way to approach team building is with the thinking that first you start with a product, then you create a brand and lastly you create a business. This approach would imply that as a founder and scrappy startup, you hire just enough people to get you from product to brand to business, adding on as your company scales and evolves to the next level.

I’ve seen this often go: 1). founder who created the product to 2). key marketing hires that build brand and awareness around it to 3). back-end hires in operations/supply chain to ensure execution and go-to-market.

While this approach seems logical, I have also seen other brands with a different mindset who “start with the end in mind,” founders who think first about the business/commercialization of a product and how you can develop a brand around it. They make sure that they are setting themselves up for success and scale and will try to build the organizational infrastructure for the future business they are creating.

Starting with the business strategy first allows you to identify the key positions to bring on that suit your product category, marketing strategy and main channels of distribution.

No matter the approach, founders want to be careful not to over-build their teams, especially at the early stages before proof of concept has occurred. Generally, we see more inefficiency and unprofitability with brands at a sales per head less than $500,000.

Between $500,000 to $1 million in sales per employee, brands are in growth mode building teams for future scale. Greater than $1 million, brands are more likely to achieve that coveted profitable growth status.

Rich Gersten Co-Founder And Managing Partner, True Beauty Ventures

The first question a founder should ask themselves when building out their team is: What is my superpower? Whether it’s in product innovation, brand storytelling or another area of the business, founders should be able to identify where their strength and passion lies and exploit it for the benefit of the business.

In those other areas where a founder may be less skilled is where the real value of a team comes in. A founder may not be the best person to run the business day-to-day, manage retail relationships or optimize supply chains. Being able to bring in team members best equipped to run those functions so the founder can keep doing what they love is essential to a successful outcome for the brand.

Of course, this leaves many roles to fill and with only so many resources. A founder needs to prioritize hires based on the strategy of the business and where it stands today in its growth trajectory as well as its financial wherewithal to add to the team.

A brand focused on launching retail may decide to hire someone with retail expertise to manage those relationship and execute a successful launch. For a brand focused on growing its DTC business, this may prioritize a hire in ecommerce, for example. We often see supply chain and finance get overlooked.

No matter the scale of the business, marketing is an area where having the right team members is essential in order to amplify the brand’s story and messaging. Having a team skilled in creative, content creation, social and digital marketing, and influencer and community building is crucial. This will likely take form in a few roles, but a smaller brand can leverage agencies to keep the team lean until the business scales.

We know firsthand that people are imperative to a successful outcome for a brand, but can also be a burdensome fixed cost to a business and make a viable path to profitability challenging. This is why we spend a lot of time with our brands evaluating where there may be weaknesses in the current organization and bolstering those areas with the right hires, all without losing sight of a lean, scrappy team mindset that’s so essential for young brands.

As a general rule, one FTE (full-time equivalent) for every $1 million in sales is a good proxy as a business begins to scale.

Grace (Fooden) Correy Fashion and Beauty Brand Executive Consultant

As the former co-founder of Biophile skincare and a consultant to emerging brands, I've learned there's more than one approach to team building. Brand founders often face a delicate balancing act.

On one side, they may get advice to bring in seasoned C-Suite executives who can provide strategic guidance and a competitive edge in a challenging market. On the other hand, keeping costs down with a lean team is equally emphasized. So, how does a budding beauty brand navigate this conundrum? Let’s break it down.

Team size at various stages

Determining the optimal team size for a growing beauty brand is not a one-size-fits-all answer, but here’s a framework to consider:

• Pre-launch to initial launch ($0 to $500,000 in revenue)
  • Team size: three to five people
  • Key roles: founder/CEO, product development, marketing/social media manager, operations/logistics and possibly a part-time financial consultant
• Early growth ($500,000 to $1 million in revenue)
  • Team size: five to 10 people
  • Key roles: In addition to the initial team, consider hiring a dedicated sales manager and a customer service representative. If budget allows, bringing in a part-time CFO can be beneficial.
• Scaling up ($1 million to $5 million in revenue)
  • Team Size: 10 to 20 people
  • Key roles: Expand the marketing team to include roles like a digital marketing specialist and content creator. Strengthen the operations team with a supply chain manager and quality control specialist. It may also be time to bring in a chief operating officer (COO) to manage day-to-day operations.
• Established growth ($5 million to $10 million in revenue)
  • Team Size: 20 to 40 people
  • Key roles: At this stage, it’s crucial to have a well-rounded executive team, including a CEO, COO, CFO, chief marketing officer (CMO) and chief technology officer (CTO). Expand the marketing, sales and product development teams further and consider adding a human resources manager to support the growing team.

Hiring beyond the founder: key roles to fill first

For emerging beauty brands looking to make strategic hires beyond the founder, here are the top roles to consider:

• Product development specialist
  • Why: At the heart of any beauty brand is its product. A specialist in product development ensures that the brand consistently delivers high-quality, innovative products that meet market demands and consumer preferences.
• Marketing/social media manager
  • Why: Building brand awareness and engaging with your target audience is crucial in the beauty industry. A marketing manager who can handle social media, content creation and digital marketing will drive brand visibility and customer engagement.
• Operations/logistics manager
  • Why: Efficient operations are key to maintaining profitability and ensuring timely delivery of products. This role focuses on supply chain management, inventory control and optimizing logistics.
• Sales manager
  • Why: Driving revenue growth is essential for scaling. A sales manager can develop and implement sales strategies, manage relationships with retailers or distributors and identify new business opportunities.
• Customer service representative
  • Why: Excellent customer service fosters loyalty and enhances the overall customer experience. Having a dedicated person to handle inquiries, complaints and feedback ensures that customers feel valued and heard.

Additional considerations:

• Fractional work is key
  • In the early stages, leveraging fractional executives and consultants can be a cost-effective strategy. This approach allows brands to access high-level expertise without the full-time expense, thereby keeping overhead low while benefiting from specialized knowledge. This includes factional CEOs, CFOs and COOs and fractionals for the top five positions mentioned above.
• Expect frequent turnover
  • The startup environment is dynamic and ever-changing. It’s essential to be prepared for frequent turnover as the team evolves and adapts. Finding the right fit may take several iterations and being flexible in making necessary changes can ultimately strengthen the team.
• Growth strategy and ownership
  • Beyond team size, a founder has to consider their preferred growth strategy. Private equity often steers founders to prioritize growth over profitability, valuing rapid expansion and market capture. This approach can lead to significant growth, but it may come at the cost of higher spending and lower immediate profitability. Conversely, a more measured growth strategy can maintain higher profitability and more sustainable spending but may result in slower market penetration.
  • Another key consideration for founders is whether they prefer to grow more slowly and retain more ownership or grow rapidly and collaborate with a board of directors. This decision impacts not only the pace of growth, but also the level of control and autonomy a founder has over their brand.

In conclusion, the ideal team size for an emerging beauty brand depends on its growth stage and revenue. Initially, keeping the team lean with multifunctional roles is wise. As revenue grows, gradually expanding the team to include specialized roles will support scaling and operational efficiency.

Prioritizing key hires in product development, marketing, operations, sales and customer service will position the brand for sustainable growth and market success. And lastly consider fractional hires and consultants for all key roles including the C-Suite in a brand's early stages.

Andrew Ross Senior Advisor and Venture Partner, XRC Ventures

Just as there should be no prescribed playbook for when to potentially bring in a CEO, there is similarly no magic formula for how to scale your team alongside your business. It is a function of your brand, its promise, your strategy, the capabilities of the founding team and the combined business and funding model.

“It depends” is not a helpful answer, so here are five principles that we have found helpful working with founders across a variety of business and funding models:

1. Benchmarks like full-time equivalents (FTEs) per $ can give you a very general sense of whether you are way too lean or heavier on people than comparable companies, but the margin for error is so high based on the size of the steps in cost and people at early stages. You should be very wary of using them. Frankly, your profit & loss (P&L) is a better guide for you at early stages on what you can afford.
2. Hiring should be guided by strategy and business model based on two key questions:
   1. Do I need new capabilities to continue to scale successfully, e.g., to accelerate growth in DTC or wholesale or to manage material risks like forecasting and operations?
   2. Do I need incremental or a step-change in capacity to continue to scale successfully, e.g., maintain or improve service levels on operations or fulfillment, drive new product launch (NPL), or to scale community engagement?
3. Hire ahead (but not too far ahead) on capability needs, but behind (but not too far behind) on capacity needs. Capabilities should accelerate proven growth or manage material risk before it happens, but double check on capacity hires in case this is a temporary blip in demand. Every hire is a big chunk of selling, general and administrative (SG&A) expenses and is adding fixed cost to your burn rate. Firing people is horrible and hard and has secondary effects in PR and stakeholder management.
4. With this in mind, always look for other ways to address your opportunities and issues until you are sure you need to hire someone. Can you add a consultant or a freelance worker or outsource or use an agency versus incur that fixed cost?
5. Finally, determining the “where to hire” is 10% of the decision for startups. “Who to hire” is 90% of the upside and the risk, so really invest in the process to ensure that this person brings what you need in terms of capabilities. They should also bring a positive impact on the culture and most importantly understand what is required at a startup, especially for people whose experience comes from corporate. Don’t hire someone who you are not absolutely sure brings everything you need. Treat these decisions with as much care as you would distribution strategy or new product formulation and launch, and they will have the same kind of impact on your trajectory as well as provide leverage rather than headache and heartache for busy founders.

Emma Froelich-Shea President, EFS Advisory Services

In my experience, beauty founders are usually product or service gurus with remarkable storytelling abilities. They're often artists whose meticulous attention to detail regarding consumer experience allows their formulas or menu offerings to stand out. Founders can often sell through many single product MOQs on their own or with some junior assistance.

Founders can stay small and achieve anywhere from $250,000 to $500,000 in top-line sales, provided that the initial SKU count or menu remains unchanged, and they can devote themselves full-time to their company.

Every founder I've met has unlimited energy, so the timing to build a more experienced staff isn’t about exhaustion. Generally, it correlates to the founder's experience in the beauty industry. A first-time founder new to the industry will need senior-level, experienced help much sooner than a founder who "grew up" in marketing or sales at a strategic and spent additional time at a startup before going out on their own.

Usually, the need to add senior staff is a function of the complexity injected into the business over time. Whether it's adding new locations for a spa business, adding physical doors to a .com business or selling into new countries, the added complexity will require staffing up.

So, my advice is to use a consultant to get into an Ulta test. Then, quickly hire an experienced SVP of sales if the test goes well. The SVP can manage the field sales team required to call on chain-wide doors.

Surprisingly, the first department to staff up isn't necessarily a founder's area of weakness. Typically, founders reach out for help in general management or finance because they're under-confident in their numerical skills. But if a founder procrastinates on tasks like in-store merchandising or TikTok strategy despite being a skilled storyteller, they should prioritize a senior marketing hire or consultant.

Similarly, if vendor relationships are neglected despite a founder's strong interpersonal skills, a competent supply chain director should be hired promptly. In a business with more than eight aestheticians, licensed massage therapists or stylists, recruiting an experienced spa or salon director is essential.

Another good rule of thumb is that no one person should have more than five direct reports. So, hire up, not down. Hire more senior staff so junior team members get the best people management available. You’ll get more out of your existing team.

You'll notice I haven't used the terms CEO, CMO, et al. I'm not a fan of those titles in companies with less than $35 million net sales generated from a single P&L. Too often, those titles are used to attract talent away from large strategics.

Jumping directly from a major strategic to being CEO of a small independent can be risky for the talent and the brand, especially if the title is also used to compensate for a low salary. Instead, find someone with large and small company experience and bring them on as a GM, president or department SVP.

Unfortunately, C-level talent is often unplanned or not well planned. Usually, the suggestion comes right after a tough board meeting with lagging sales on the agenda. Investors and advisors tell founders to fix the sales issue by hiring C-Suite talent and cutting marketing expense. Building the team in this manner creates enough founder resentment to make a recruiter's job almost impossible.

Hiring a GM/president and department team leaders should be done in whatever sequence the business complexity requires with a disciplined eye on SG&A. In contrast, hiring a CEO should be discussed from the business’s infancy and timed to the completion of a major financial objective. When the company is getting close to that goal, the founder and the advisory team would work together to recruit the right CEO to achieve the next goal. The hope is that hiring the CEO would be a compliment, not a critique.

Robin Albin Founder, Insurgents

Recently, my good friend and constant colleague, Daria Myers, and I were discussing a startup we were advising and what they might need staff-wise. She reminded me of something the late, great Jeanette Wagner, vice chairman emerita of the Estée Lauder Cos., would often say: “Look for someone with ‘fingerspitzengefuhl,’ a.k.a. fingerspitze.”

It’s a German word that literally means “fingertip feeling,” that is an intuitive flair or instinct, someone who has their finger on the pulse of the market and the audience, what I call Spidey Sense.

When $$$ are limited, “fingerspitze” can be the holy grail of a successful startup and a trait more likely to be found in a CMO than a CEO. While a CEO may have business and operational skills, a great CMO will have holistic experience that encompasses creative, product development, strategy, marketing, finance, sales, planning and operations.

If you think of the founder as the composer, the CMO is the conductor who interprets the score, then through gestures sets the tempo and guides the performance so that the musicians (the rest of the team) understand and play it perfectly. The conductor tells the musicians when to start, how fast to go, when to pause or slow down.

Like a conductor, the CMO helps shape, develop and tweak the music, optimizing his or her knowledge and experience to present a flawless performance. The result is beautiful, memorable and exciting piece of music for audiences to enjoy and engage with.

Note: “Fingerspitze” is not something you’ll find on some CV or bio. If you are a founder, be sure to vet candidates very carefully. Whoever you consider must be in concert with and passionate about your brand beliefs, culture and behaviors, your music, and be able to elevate and help execute it with passion and verve.

I’ve seen really amazing businesses run into the ground by C-Suiters who miss the brand mission and try to infuse too much too many corporate obstacles into the most inspired ideas.

Tara Cohen Founder and CEO, Mixst

When To Grow The Team In Emerging Beauty Brands: Strategic Hires And Scaling Wisely

Most emerging beauty brands are led by a founder with a vision for the brand and an agile team that is lean. Everyone wears multiple hats as they cover many areas at the same time.  As the company grows, the decision on when and how to expand the team is crucial.

The question of when to bring on C-Suite executives, particularly a CEO, is often debated. While seasoned leadership can provide strategic direction, industry expertise and professional working standards, it comes at a cost that may not always align with the financial realities of early-stage startups.

The Case Against An Immediate CEO

I often hear startup veterans argue against appointing a CEO in the early stages. The primary concern is cost. Experienced executives demand substantial compensation packages, including a significant chunk of equity in the company, that can strain limited budgets.

Moreover, I’ve found that while a CEO may excel in managing established brands, they often struggle when they have to get their hands dirty with the nitty gritty of brand building at the level of an emerging brand.  They’re not used to rolling up their sleeves given their prior experiences may have granted them the resources and staff of a larger company, with the ability to delegate and supervise.

From personal experience and observations within the industry, it's clear that the early days of a beauty startup require hands-on leadership that can execute as much as strategize. Founders often find themselves not only developing products but also managing day-to-day operations, marketing and team building. In this context, a versatile general manager who understands the details of operations can be more effective in the role than a high-level executive.

Building A Lean, Effective Team

Rather than an established CEO, building out the staffing of an emerging beauty brand at various stages of growth requires careful attention to the budget and an eye for spotting talent.

Initial Stage (Pre-Revenue To $500,000)

1. Founder/general manager: Typically, the founder plays the role of a general manager who oversees all aspects of the business, from product development to marketing, packaging and operations.
2. Operations manager: A seasoned operations person is crucial early on to ensure smooth logistics, manage vendors and guarantee operational efficiency.
3. Marketing/social media manager: B2C brands live and die online, so a skilled marketer who can handle social media and digital marketing is essential for brand visibility and new customer engagement.
4. Creative/content developer: A creative individual who can design compelling content for marketing materials, packaging, website and social media helps establish the brand's aesthetic and narrative.
5. Product developer: Often overlapping with marketing and operations responsibilities, a product developer who understands consumer needs and trends can drive innovation and product differentiation.

Growth Stage ($500,000 To $2 million)

As revenue grows, the team can expand strategically:

1. Finance manager: With increasing financial transactions and complexity, a dedicated finance person ensures fiscal responsibility and financial planning.
2. Customer service manager: As customer base expands, excellent customer service becomes pivotal for brand loyalty and positive word-of-mouth.
3. Sales manager/distribution specialist: To scale distribution channels and manage retail partnerships (Sephora, Ulta Beauty, Bluemercury, Amazon, etc.) effectively.

Strategic Hiring Guidelines

When considering hires beyond the founder, here are some guidelines:

• Revenue-based hiring: Consider adding team members incrementally based on revenue milestones. For example, hiring one person for every $500,000 increase in revenue ensures that each new hire contributes directly to growth without burdening finances prematurely.
• Stretch positions: For a startup brand, the ideal situation is identifying people who are capable of jumping into a stretch position (i.e., a role that is just beyond their current experience and skill set) and growing into the role. A junior person with five years of experience at a big corporate cosmetics company will be attracted to a more senior role at a smaller company as it sets them up for future success in their career path.
• Titles: For all these roles, a founder can provide incentives and optionality to the brand by creating titles that allow for promotion and growth. Instead of immediately hiring a chief financial officer, for example, bring in a person as treasurer or controller who can, based on performance, be selected for promotion to head of finance or ultimately chief financial officer.
• Roles that drive growth: Prioritize roles that directly impact revenue generation and brand development. Operations, marketing and product development roles are critical early on, followed by finance and customer service as the brand matures.

Conclusion

In conclusion, while the temptation to bring in seasoned executives early on is understandable, the practical approach for emerging beauty brands lies in building a lean, focused team that can execute effectively while keeping costs manageable.

By prioritizing roles that directly contribute to growth and profitability, brands can navigate the complexities of the market with agility and resilience. Ultimately, success in the competitive beauty industry hinges on striking the right balance between strategic expansion and financial prudence.

Jamila Bannister Managing Director, JBannister Branding LLC

As a business grows, its needs evolve. I believe in a lean business model, but there is no one-size-fits-all approach to a business, therefore to prescribe a team size might be counterproductive. Instead, you should assess the needs of your business against its goals and hire as needed when you grow.

In the beginning, it's primarily the founder working in the business, with most things being outsourced or being done by family and friends, but as you get to the late five figures or six figures, and you can no longer manage production, handle finances, handle admin and juggle the endless balls that come with owning a beauty business, this might be the time to start hiring staff.

The very first person I'd advise a growing brand to hire is a chief financial officer. This person's role will be to set up systems to manage the day-to-day finances as well as advise on how they can make more shrewd financial decisions to set the company on a growth path for expansion and profitability

Next, I'd hire a (fractional) CMO, particularly someone who has a track record for leading successful campaigns and driving sales. Third, I'd advise hiring a chief operations officer to oversee the product development, manufacturing and distribution.

As the brand grows, hiring a COO will allow the CEO to step back from the daily grind required to run the company and focus on mapping the vision for the company's growth. The first order of business may be to work more closely with the CMO and build a growth strategy to drive awareness, increase customer loyalty, grow B2B relationships and drive consumer sales.

Elizabeth Lim Strategic Advisor and Fractional CMO, Elizabeth Lim Strategy & Consulting

There are a lot of cross-pressures for emerging beauty brands, and the size of a team should strategically aligned with the brand’s goals and revenue targets. Much like the previous article about when to hire a CEO, there isn’t necessarily a one-size-fit-all recipe.

With that said and generally speaking for pre-launch to early-stage brands ($0 to $1 million revenue), the founder at this stage should be the visionary leader that is responsible for strategy and fundraising while building a strong foundation with three to five key hires. Essential roles include product development, marketing, sales, operations and finance.

To preserve resources, founders should seek individuals that can manage multiple tasks such as a finance person who can handle also handle operations. Another option to consider hiring consultants or fractional C-Suites, where they will have access to knowledgeable and experienced professionals that can guide them to achieving milestones quicker while limiting pitfalls.

As the brand grows and revenues increase between $1 million to $10 million, new roles will be necessary to handle the broaden market reach and expansion. This can be six to 12 individuals and can also be a mix of full-time hires and consultants that specialize in more specific marketing strategies, business development, financial budgeting, demand planning, e-commerce operations, digital efforts and more. It may also be good time to evaluate if bringing on a CEO or general manager at this stage makes sense or not.

Beyond $10 million in revenue and given it is likely that brand will have an expanded product portfolio and/or broader distribution channels, it will be important to continue to strengthen and support its growth with additional key hires. If the brand did not hire a CEO/GM before this milestone, I would recommend evaluating this key hire again along with some other potential C-Suite [roles]. Other roles to consider at this stage could be a chief of staff and a human resource specialist.

It's essential for brands to routinely evaluate the team structure while maintaining efficient operations in order to continue to grow successfully.

Avigon Paphitis Beauty Industry Advisor, Vanity Country Club

There's no magic formula, just the right questions and the right people. From consulting with and working internally at brands of various sizes, it's clear that a select few individuals often carry the bulk of the workload and drive the biggest impact. Founders should focus on identifying these thinkers and doers who truly add the most value.

Effectiveness among team members varies widely at all levels. Exceptional C-suite leaders can drive significant growth and turnaround, while others may prove less impactful despite their high costs to the business.

To get this right, start by balancing critical questions:

1. What can your business afford? What can be paid from existing funding versus current or future revenue? How long can you sustain this spending based on conservative fundraising or revenue growth assumptions? This sets a cap on hiring ambitions.
2. What critical work needs to be done in your business? Is it strategy development or refinement? Building deep relationships with channel partners? Optimizing marketing and social media or developing new products? Is the work focused on guiding the business/team's direction, driving revenue growth, sustaining operations or managing necessary costs/overheads?
3. How can this work be best delivered? Full-time versus part-time versus contractor/third-party outsourcing? Senior versus junior team members? Salary-based versus incentive/performance-based versus equity-based compensation? Local versus offshore hires?

With these lessons in mind, typical roles and ratios I'd expect to see in early-stage beauty brands include:

1. CEO—overall leader, potentially accountable for strategy, with input from directors/heads of brand and product or external third parties.
2. Brand, marketing and channel
3. Product and Innovation
4. Support services—finance, HR, legal

As the business grows, these functions can expand in alignment with the business's needs and growth trajectory.

When engaging consultants or C-Suite experts, it's crucial to deploy them where they can deliver the most value rather than burdening them with day-to-day tasks that anyone could handle. They should also be given the freedom to do their job. I've seen exceptional C-Suite individuals join companies only to be micromanaged and distrusted by founders, eventually leading to their departure.

Another important consideration is that each brand has its unique strengths (e.g., innovation, social). For example, a brand focusing on innovative, science-backed products might prioritize a larger R&D team and a leaner marketing team.

Conversely, a brand specializing in trend-based, quickly producible items might emphasize a robust creative/content team for strong brand marketing. Founders should leverage their strengths when hiring, prioritizing roles where they may lack expertise.

Laura Chisholm Founder, LTC Beauty Consulting

Strong brands need capabilities in product development, brand creative and content direction, marketing (core, social, influencer, performance), finance, operations and sales (e-commerce and retail).

I advise startup brands to ensure they have a strategy and support funds in place early to have expertise at the helm in these areas to set the stage for next-level growth. Since each business is unique there is no one-size-fits-all formula, but to start I would:

• Build around the brand founder. Identify their strengths to determine which areas they can successfully and reasonably own.
• Augment founder-led initiatives with mid- to entry-level full-time support that can help execute day-to-day tasks and be developed to take on further responsibilities as the brand grows.
• Fill out the leadership team with fractional industry experts able to provide strategy and tactical execution where needed. Today, many talented resources can provide experienced guidance without requiring a full C-Suite salary.
• Combine leadership areas where you can (sales and marketing, finance and operations) to streamline communication and save costs.
• Business trends will dictate where roles are divided and when they are needed. For example, if brand growth is driven by social and influencer outreach, you may hire full-time support early in this area, or if a retailer comes calling, you may need a brick-and-mortar expert who knows how to roll out the stores and manage field team support.
• No matter when or where you hire, all hiring decisions should be incorporated into the brand's P&L to ensure the role's ROI and profitability for the brand.

Catherine Collins Founder, Constellar Consultancy

Unfortunately, there is no one-size fits all solution to when brands should make their next key hires. It's often a balancing act between investing in expertise for future success whilst remaining lean and managing current costs. What we find often helps inform hires is taking stock of a brand's current situation and defining their goals as the starting point.

• What is the company's turnover?
• How quickly is it growing?
• How many SKUs does the brand sell?
• What's their retail focus/strategy—D2C, widespread distribution at national retailers or in partnership with one to two major retailers?
• What are their investor and distribution goals, both near and long-term outlooks?
• What does their cash run rate look like?
• What are the team's/founder's current strengths? What do they do well, and what is preventing them from spending their time from doing what they excel at?

For an emerging brand, it's all about balance. We've seen a lot of brands hire too heavy and too early on the top without having proper support in middle and junior tiers to execute daily tasks.

However, increasingly today there is a middle ground between going it alone and breaking the bank for numerous hires: fractional consultants and external agencies. This way brands are able to save on costs of hiring an in-house team that is too senior too soon.

The real benefit of fractional consultants is that they allow the brand to gain access to seasoned executives that have been through the various growth stages with other emerging brands. Combined corporate and startup experience is ideal.

A good fractional consultant will often have a multifaceted background and deeply understand the life cycle of brand building at the different growth stages. They can help lay groundwork and give much needed direction so that the brand can begin to plug in more junior talent to execute and help run day-to-day.

For those that don't want to go down the fractional route, the most critical initial full-time hires are typically head of sales and head of finance/ops as these areas drive the company forward whilst ensuring the health of the business. The other branches in marketing, product development, social/digital and creative can often sustain a longer window managed by external agencies.

Ultimately, the decision depends on finding the right balance for each brand. Many companies invest heavily in C-Suite hires, but neglect the support needed for day-to-day operations. There's no definitive answer.

For example, a brand with a couple of SKUs selling mostly on Amazon and via their D2C channel with a founder who has a great sales background and solid advisors on their team in digital growth and international distribution is probably not as focused on hiring a head of sales as they would be on an hiring an in-house social media executive/ digital support who can execute the day-to-day tasks and drive the digital growth forward. It's more about thoughtfully weighing the needs and goals of the brand and the founder.

Margarita Arriagada Founder, Valdé

The aspects I always ask brand founders before I advise on infrastructure are:

-       What are the founder's skill set above and beyond the creation of the brand?

-       What are they savvy in? Some are great operators or great at product development or they are marketers or social media-savvy content creators. This is super important.

-       Second, what is their commercial vision for the brand? Are they going to want to be DTC for a time? Do they want to wholesale right away? If so, where? Independent boutiques or larger specialty retailers?

-       What is the positioning of the brand? Is it super premium? Masstige? The more premium the positioning, the more elevated assets are needed.

-       What is the expected growth trajectory?

I don't have a hard fast rule or point of view on adding X number of people per revenue, but I do have a point of view that the following need to be covered one way or another from the get-go, initially all independent contractors:

-       Finance: accountant, bookkeeper and fractional CFO

-       Community manager: Social media savvy

-       Operations multitasker: To oversee warehouse, item set-up, project management, marketing help, troubleshooting.

-       Marketer: With digital/e-comm experience

-       Product development/regulatory: This can be outsourced or the founder can drive via partners.

-       Wholesale manager

-       Legal

Some roles can be junior like community manager, but a marketer is worthy of investment. Some roles can act as GMs. The role of marketer that can oversee either agency or individuals for performance marketing and e-comm is a must-have.

A founder may reach out to retailers directly, so a wholesale manager may not be necessary. On the other hand, people that know how to wholesale can open doors very diligently and keep the brand afloat. I give priority to a strong social community manager after a marketer as this role is so customer centric and an important artery to all things brand.

Depending on brand ambitions, I think considering resources like The Board or Chief are good options to consider to tap top executive talent depending on budget. Everything else can be outsourced, including creative, public relations, product development packaging.

As the brand grows, having a strong PD in-house becomes a priority. The fountain of inspiration needs to be sourced organically as much as possible.

As for a CFO/COO, it’s important for a CFO to understand supply chain and demand forecasting to streamline costs and processes. If there are investors, a CFO/COO is a top priority to manage expectations. I would consider a GM if the founder is strictly creative.

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