From Bootstrapping To Multimillion-Dollar Business the trajectory of Carol’s Daughter
July 15, 2021
This week for our Masterclass Moment we are going to discuss the trajectory of Carol’s Daughter. Founder, Lisa Price’s story is a shining example of building at one’s own pace.

Fast Timeline

1993: Company started

2002: The Oprah Show

2003: Met business partner Steve Stoute

2005: Partnered with Sephora

2007: Took on Equity Partners, with Pegasus Capital Advisors

2014: Acquired by L’oreal

2021: Still connected to the brand

The Very Beginning

1993: Encouraged by my mother, Carol, with $100 in cash I launched Carol’s Daughter in my kitchen. I mixed the products in-house and my husband and I sold small jars at a craft fair. That evolved into us selling out of our home, borrowing small amounts of money from family to mail catalogs to potential customers then paying my family back when orders came in.

The Turning Point

2002: After our appearance on The Oprah Winfrey Show, a lot of people started counting our money for us. People started telling me to make extra products because I would get 10,000 extra orders. They said I’d be a millionaire overnight. None of that happened. We did get a lot of orders, but not anything that we couldn't handle. For me the opportunity allowed me to dream bigger because I used to joke about being on The Oprah Show. It was a harmless joke, but then it actually came true. It actually happened. That gave me permission to dream bigger.

To see someone that I looked up to so much, be so humble and so genuine and so authentic, really taught me that you don't have to lose yourself when you're a successful person. That’s what made The Oprah Show such a powerful moment for me.

Relationships with Retailers

2005: Outside of boutiques and salons our first retail partner was Sephora. We had several small mom-and-pop accounts, but as far as major retail partners. Sephora was the first one.

We secured them through my former business partner, Steve Stoute. We realized that we needed prestige positioning, so Steve got connected to Sephora. Turns out the meeting was with the CEO of Sephora, and not just like someone at Sephora. We had a conversation with him. And he was interested. He was interested in something new, something different, something that was going to bring in a different consumer. They took a bet on us. We had that conversation in July of 2005 and we were in their stores in 2006.

The Exit Strategy

2007: Once we took on Equity Partners at the end of 2007, the plan was in three to five years to then sell the company, because you have to have an exit strategy. Unfortunately, in 2008 and 2009 the recession hit and that three to five-year plan stretched into a seven-year plan.

When the brand got to the point that we were going to go to L'Oreal, the plan was to offer the brand to multiple companies because we didn't know where we would end up. I knew where I wanted to go. But we had to open up the process, we couldn’t go into that process with our one choice in mind and just go for that one. No, we had to meet with multiple options. Especially since we had Equity Partners, to satisfy the partners having an exit strategy was critical.

The Acquisition

2014: The L’Oreal acquisition was not an easy process. One of the misconceptions that existed at the time was people thinking that one day you just decide like, ‘Oh, you know what? I really don't want to do this anymore. Let's just sell to somebody.’ Acquisitions don't work that way. You have to be at the top of your game, you've got to be making great numbers, you have to be profitable, you have to be very attractive, you cannot be a fixer-upper, you need to be in a really good place for successful acquisition to occur. That's what we were working towards prior to going out and meeting with different companies to be acquired. It was an arduous process, to say the least. Ultimately, L'Oreal became the buyer for the brand in 2014. And our goals were pretty much aligned at the time that they acquired us.

The day after the acquisition technically everything changed. I went from an entrepreneur to an employee, I went from an indie brand to a part of this large corporation. There was money that I never had before going into my bank account. But I was still Lisa, I was still Carol's daughter, I was still cooking stuff in the kitchen. I was still that same chick from Brooklyn. So a lot changed, but a lot stayed the same.

After The Acquisition

2021: It doesn't necessarily work that you write yourself into the contract after the acquisition, but I am in the process. Typically, that is the case if the founder of the company is tied to the brand in any way. For example, if there's a brand out there that you love, they kind of want the founder to come with it because that's who people connect with. So you kind of know upfront your role as the face of the brand. One of the first questions I heard was, are you going to stay? Or are you going to leave?

I chose to say. If you express an interest to stay, typically there will be a contract because they want to try and keep you around at least for three years. They want there to be some sort of continuity. I'm in year seven now, so I'm okay.



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