When Sephora launched Accelerate, an incubator-like program to enable female-founded beauty businesses, in 2016, the company pledged that it would support 50 women-led ventures by 2020. Three years into the program, Sephora is more than halfway there, with 31 entrepreneurs.
Accelerate takes female founders through an extensive invitation and application process, a one-week “boot camp” in April and a subsequent six-month mentorship, concluding with a “Demo Day,” or pitch presentation day, for investors and Sephora employees. The training cohort focuses on three categories: merchandising, technology and sustainability, the latter of which was added in 2017. Accelerate participants receive extensive training in these areas from Sephora employees, as well as Sephora’s other cross-functional teams, including strategy, digital, social and marketing.
The female founders also receive two all-expense-paid trips to San Francisco and opportunities to receive monetary grants and potential loans. It had previously been reported that Sephora provided $2,500 grants to these entrepreneurs; however, per company policy, it would not confirm the exact amount offered to each founder in 2018.
Accelerate is growing. Sephora had the highest number of applications to date in 2018, with over 500 applications, up from 300 last year, and while it had previously focused on North and South America, the latest program included women from France, Switzerland and China, as well. This not only included more employees and investors at “Demo Day” — over 250 attendees (Sephora wouldn’t comment on who those exact investors were) — but it also enabled the participating beauty brands to secure more Sephora-exclusive retail partnerships. The latest class, which wrapped Friday, was Sephora’s largest cohort to date, with 13 female founders.
Other incubators and accelerators are popping up, like L’Oréal and Founders Factory’s, which launched in 2017, and Y Combinator, which isn’t beauty-specific, but invests $120,000 into consumer goods companies.
For Sephora, though, it’s not all about funding, but educating and training the next guard of beauty entrepreneurs, said Corrie Conrad, Sephora’s vp of diversity and inclusion as well as Sephora Stands, the company’s social impact strategy division.
“Artemis Patrick [Sephora’s chief merchandising officer] always says when we started Sephora, we went to those indie, younger beauty brands versus the big players because they were the ones that wanted to work with us,” said Conrad. She added that 85 percent of venture capital funded startups are led exclusively by men. “We know we have this opportunity to continue to foster these brands and make them grow,” she added.
A perfect example of this? Nine-month-old cannabis-infused skin-care brand Ho Karan, which was part of Accelerate 2018 and founded by Laure Bouguen. Ho Karan landed an exclusive Sephora France online partnership after participating in the program, making it the first international collaboration for the company. Certainly, there is opportunity for Ho Karan to grow in the States, though, given Sephora U.S.’s new interest in cannabis beauty products, like Milk Makeup’s Kush High Volume Mascara and Origins‘ new Hello, Calm Mask.
Stateside, Cat Chen’s Skylar Body, a conscious and clean fragrance line, will launch in Sephora stores this fall. Skylar had originally been approached by the company’s merchandising team to apply for Accelerate last year. (The merchandising category is by invitation only, while technology and sustainability participants have to apply for the program.) Subsequently, Skylar did apply and was accepted into Accelerate 2018 — it will be the only U.S. brand to be carried by Sephora from this cohort class.
“We first became interested in Skylar after discovering the brand on Instagram,” said Carye Campbell, Sephora director of merchandising for fragrance. “The brand’s message and aesthetic were not only beautiful, but also would resonate well with our clients.” Skylar, like Ho Karan, also happens to be in line with a recent Sephora interest — this time, its in-store and online clean beauty initiative, which launched in June.
While it would seem that Chen’s Skylar had a leg up, her mentorship with Campbell and the Accelerate program didn’t guarantee her foray into Sephora stores. Of the 31 Accelerate graduates over the last three years, only three prior brands have secured Sephora retail partnerships, including organic skin-care line LXMI, vegan fragrance collection 7 Virtues and Vitruvi, an essential oils and diffuser line.
Other Accelerate participants from the past two classes have landed retail partnerships elsewhere, like 2016’s Sahajan, an Ayurvedic line now in Credo Beauty, and 2017’s Kaia Naturals, which is carried at The Detox Market and Credo.
For Chen, the in-house Sephora cross-functional training, plus the outside agencies the company brought in for Accelerate, like Concrete Design, helped with tweaking packaging and introducing new fragrance formats into the assortment, like rollerball perfumes.
Demo Day was particularly thought-provoking for Chen, who was faced with numerous questions around the natural fragrance category following her three-minute pitch. “Most investors asked, ‘What does that mean to have a natural fragrance?’ ‘What does it mean when other people don’t have natural fragrances?’ The education around that was huge,” she said. “Accelerate isn’t just about growing brands but being on the cutting edge of what’s new and happening next.”
The path beyond Sephora retail
Being on the forefront of the next big thing is exactly what Sephora Accelerate is facilitating, according to 2018 cohort member Ming Zhao, CEO of AI-driven skin-care company Proven, who wasn’t looking for a retail partnership through Accelerate, but rather training and connections in the beauty space. She previously was the head of partnerships at NerdWallet and a private equity investor at Bain Capital. Zhao had previously been a part of the NASDAQ Milestone Makers Program and in Y Combinator — neither gave her the beauty-specific expertise she was looking for.
“Sephora made me think about Facebook beauty marketing and how to work with YouTube influencers. I wasn’t really thinking about those things before,” said Zhao. “I wasn’t a beauty insider, and Proven is a pretty nerdy idea for beauty.”
Still, those Sephora connections have been especially fruitful for Zhao, as she even partnered with members of the 2017 Accelerate cohort class, like Dana Rae Ashburn of Able Cosmetics and Marta Cros of The Ritualist for a booth at August’s Indie Beauty Expo in New York. “Sephora helped connect us and even footed part of the bill,” she said.
The expo was not a Sephora initiative, but the retailer did support the brands in their efforts by providing some funding for the trip — it would not reveal the exact amount. It’s a way for Sephora Accelerate to expand its reach, beyond its own platforms.
“We want to continue to help these businesses grow, even beyond the program,” said Conrad. Chen is an example of this: While she didn’t work on actual product formulations, like new scents, during Accelerate, it’s something she plans on working with Sephora on in the future.
The 2019 application process begins in October and will be an even greater push for Sephora, said Conrad, from both a Sephora-centric and female-founder perspective. Global companies will be able to apply to all categories, and Thailand, Singapore and Australia will be a focus.
“There are beauty businesses and innovations happening all around the world, and Sephora wants to be a part of that,” said Conrad.