In the mid-2010s, the actor Shay Mitchell began to spend as much time at 30,000 feet as she did on land, which is to say she had a lot of free time to consider the inconveniences of life as a frequent flier. The subject of her ire? Luggage, which was either too cheap to look good or, perhaps even worse, too expensive to be so impractical.<\/p>\n
So on one of her flights, she grabbed the cocktail napkin that came with her complimentary beverage and began to sketch her own designs. \u201cI was creating items that weren\u2019t out there for me that I wanted for myself,\u201d Mitchell told Women\u2019s Wear Daily in 2019. \u201cI looked up these pieces to see if they existed and they didn\u2019t.\u201d<\/p>\n
For most people, that would have been the end of that, but not for Mitchell. She already had a thriving career as an actor, a popular YouTube<\/a> channel, and a production company\u2014why not add entrepreneur to her resume? But Mitchell, who broke out on small screens during her seven-season arc on hit teen soap\u00a0Pretty Little Liars, needed help turning her rough napkins sketches into a business.<\/p>\n Enter Beach House Group, a brand incubator launched about a decade ago by veteran business builders PJ Brice and Shaun Neff. They were just getting their new partnership off the ground when Mitchell came in for a meeting.<\/p>\n \u201cShay came out of nowhere,\u201d recalls Neff, Beach House\u2019s bleached blonde public spokesman. \u201cShe was already on an entrepreneurial journey. You could tell her juices were flowing and she wanted to build a company.\u201d<\/p>\n Beach House set up a joint venture with Mitchell; installed one of its own executives, Target<\/a> veteran Adeela Hussain Johnson, as a co-founder, and used Brice\u2019s connections making private label makeup bags and other accessories to get a line of duffles, backpacks, passport holders and other travel essentials into production. B\u00e9is\u2014that\u2019s beige in Spanish, a nod to the color of an old bag Mitchell used to travel everywhere with\u2014launched in 2018 and, per Neff, \u201cit was lightning in a bottle.\u201d\u00a0It hit $200 million in revenue in 2023, according to the company, and Neff tells me that number topped $300 million last year.<\/p>\n As celebrity-founded brands become an obsession in Hollywood, where a billion-dollar valuation is the hot new status symbol, Beach House has carved out a niche as a startup factory. It\u2019s part of a growing number of brand incubators that help celebrities turn great ideas into very real businesses by connecting them with capital, experienced executives, back-end resources like human resources, legal and logistics, and suppliers.\u00a0A lot of these incubators are small and selective: Beach House, for example, currently has just four brands in its portfolio, including oral hygiene company Moon Beauty launched in partnership with Kendall Jenner and curly hair care line Pattern with Tracee Ellis Ross. But their cultural reach can be significant.<\/p>\n Says Neff, a sort of Willy Wonka in Balenciaga\u00a0who clearly knows how to sell anything, \u201cOur magic sauce is that we can create ideas out of nowhere and blow them up.\u201d<\/p>\n Before Neff co-founded Beach House, he made his name as the founder of ski and skate apparel brand Neff, which sold to wholesaler Mad Engine in 2017 for an undisclosed price. He then invested in sunscreen startup Sun Bum before its 2019 sale to SC Johnson for a reported $400 million. Which perhaps explains the two code-protected gates I pass through before arriving at his modern, light-filled home in the hills high above Malibu.<\/p>\n Beach House co-founder Shaun Neff (right) with actor Millie Bobby Brown, with whom Beach House partnered on a beauty line.<\/p>\n After Neff, dressed casually in camo pants and a black Pirelli<\/a> baseball cap, hands me a can of Monster Tour Water, he settles in to tell me how Beach House evolved out of conversations he was having with talent looking to start their own brands. Back then, the talent agencies were more focused on landing their clients starring roles in the next blockbuster movie than helping them become founders.<\/p>\n Neff, meanwhile, had developed a reputation as a partner for celebrities through collaborations at his eponymous apparel brand with everyone from Scarlett Johansson to Snoop Dogg. \u201cFor close to 100% of consumer products, the only path to sell is through influencing people,\u201d says Neff, who teamed with retail veteran Brice, founder of disposable tableware brand Cheeky, on Beach House. \u201cThat\u2019s why we\u2019re huge believers in talent.\u201d<\/p>\n Beach House got off the ground around the same time George Clooney sold Casamigos for a cool $700 million, Rihanna launched Fenty Beauty and grew it into a nearly $3 billion business, and Ryan Reynolds invested in Mint Mobile ahead of its $1.35 billion sale. These companies added to the growing pile of\u00a0evidence that the right celebrity could help supercharge the right business. Jennifer Aniston had done it in 2007, when she signed on to become the face of Smartwater in what her agent, Todd Shemarya, says was one of the first equity cash deals of the modern endorsement age.<\/p>\n \u201cI knew they were very close to a sale,\u201d Shemarya says. \u201cAnd I knew that someone like Jennifer could help them sell faster, so she was worth the equity.\u201d His bet turned out to be correct. Smartwater owner Glaceau sold to Coca Cola for $4.1 billion in 2007 in a deal that, based on conservative estimates, likely netted Aniston tens of millions. She\u2019s since launched vegan hair-care line LolaVie, partnered with fitness company Pvolve, and become chief creative officer of supplement brand Vital Proteins.<\/p>\n The rise of social media\u2014and the direct connection it fosters between star and fan\u2014has created an environment ripe for the evolution of the endorsement deal. Once upon a time you got paid to appear in a commercial for a brand; now you own it. \u201cIt\u2019s the idea that you should be creating equity for yourself in spaces where you traditionally created equity for others,\u201d says Mahmoud Youseff, who helps clients at management firm Range Media launch their own ventures, like the Philly cheesesteak shop Bradley Cooper opened in New York City\u2019s East Village late last year.<\/p>\n Yes, you read that right. Bradley Cooper is now a cheesesteak-preneur. Today, practically every A-lister has a brand of their own. Conservative estimates suggest there are more than 300 celebrity-affiliated alcohol brands on the market today. And celebrity beauty brands alone\u00a0generated $1 billion in sales in 2023, according to the most recent available data from Nielsen. The one-two punch of the pandemic and the Hollywood actors\u2019 and writers\u2019 strikes gave a lot of celebrities a lot of free time in which to launch businesses. JLL Research reports that more than a third of all celebrity brands launched in 2020 or later. There\u2019s Selena Gomez\u2019s Rare Beauty, Dwayne \u201cThe Rock\u201d\u00a0Johnson\u2019s Teremana Tequila, Blake Lively\u2019s Blake Brown Beauty, Jennifer Garner\u2019s Once Upon a Farm, Katy Perry\u2019s De Soi, Naomi Osaka\u2019s Kinlo, and the list goes on and on and on.<\/p>\n Jennifer Aniston\u2019s 2007 equity deal with Smartwater was a watershed event in celebrity brand-ownership.<\/p>\n The space has gotten so crowded that Golden Globes host Nikki Glaser got big laughs from a ballroom full of actors in January when she quipped, \u201cIf you do lose tonight, please just keep in mind that the point of making art is not to win an award. The point of making art is to start a brand of tequila that\u2019s so popular you never have to make art again.\u201d It was funny because it was true. As working in Hollywood has become more precarious, the jobs less prolific, creating a business has become an attractive backup plan\u2014what one executive in the space, Ari Bloom, calls \u201ctheir 401k\u201d\u2014albeit one that comes with significantly more risk.<\/p>\n \u201cEvery time you see Ryan Reynolds sell one of his companies or Kim Kardashian get some crazy valuation or Selena Gomez be announced as a billionaire, we do see a lot of increased inbound because folks are like, \u2018Now that they\u2019re worth more than their day job, I should do that too,\u2019\u201d says Bloom, who works with John Legend, Naomi Osaka and others on their business ventures via his incubator A-Frame.<\/p>\n When Shaun Neff is looking for inspiration, he heads to his local Target. \u201cI walk aisles,\u201d he says. \u201cI\u2019ll just go there for an hour or two at a time.\u201d That\u2019s how he discovered an opening for Moon, the oral hygiene company he launched with Kendall Jenner that sells toothbrushes, toothpastes and whitening pens in sleek, attractive packaging. \u201cIt was glaring to me in the oral care aisle that it was a sea of sameness,\u201d he says. \u201cIt was red, white and blue, Crest and Colgate. There was nothing there that was aesthetically pleasing.\u201d<\/p>\n Neff calls himself the \u201cbrand guy, the one that creates stuff, locks in the vision.\u201d It\u2019s his job to help Beach House identify products that fill a void in the market. Take Pattern, which entered the historically overlooked Black haircare market with a suite of natural products designed for curly hair. \u201cIt\u2019s got to be an incredible product,\u201d says Neff. \u201cWhen you start a brand, first and foremost, the product wins every time.\u201d<\/p>\n Tracee Ellis Ross, the founder and co-CEO of Pattern Beauty<\/p>\n It\u2019s often after the concept is locked into place that Neff goes searching for a celebrity partner to plug into the brand. With Moon, he happened to run into Jenner at a party and asked for her number. She gave him the info for her mom, Kris Jenner, and a deal was born. \u201cWhat\u2019s crazy about Hollywood,\u201d says Neff, \u201cit\u2019s like there are a handful of parties every year where everyone\u2019s at. So if you\u2019re in the scene, you\u2019ve kind of rubbed shoulders with the majority of everyone.\u201d<\/p>\n Finding the right talent partner isn\u2019t always so easy. Neff says he\u2019s met with hundreds of celebrities over the years about turning their ideas into companies. \u201cIt doesn\u2019t take me more than 30 to 45 minutes to make the decision whether it\u2019s a good idea or not,\u201d he says.<\/p>\n Part of Beach House\u2019s \u201cmagic sauce\u201d is that it\u2019s incredibly selective about who it brings on as partners. \u201cNot everyone can pull this off,\u201d says Neff, who looks for passion and commitment from any celebrity-turned-entrepreneur. \u201cYou can find out really quickly how much they want to be involved.\u201d Mitchell\u2014who declined an interview request for this story\u2014is the source of many of B\u00e9is\u2019s product innovations, like the retractable bag strap built into every piece of luggage. Before launching B\u00e9is, she also had already built, per Neff, \u201ca credible character around travel\u201d through her YouTube series,\u00a0Shaycation, and had millions of devoted social media followers ready to buy her luggage.<\/p>\n When launching a brand with a celebrity, things like social media followers and an aspirational lifestyle are table stakes. \u201cJust because you have nice hair doesn\u2019t mean that you can sell haircare; Just because you have nice skin doesn\u2019t mean that you can sell skincare,\u201d says the agent Shemarya. \u201cYou have to have a connection with your consumer. There has to be something that is relatable.\u201d<\/p>\n The most crucial component of any of these businesses is authenticity. If your personal brand is all about the laid-back California lifestyle, for example, maybe say yes to the CBD-infused seltzer rather than the high-proof vodka. \u201cA lot of consumers have gotten inundated with celebrity endorsements and have gotten a little bit tired of it because they just look like a money play,\u201d adds Shemarya. \u201cSo when there\u2019s actually a celebrity doing something and it\u2019s really organic, it stands out more and it works.\u201d<\/p>\n When Sara Foster and Erin Foster, the sisters behind the Netflix<\/a> series Nobody Wants This\u00a0and podcast\u00a0The World\u2019s First Podcast,\u00a0began exploring the idea of launching their own fashion line, a lot of people told them they should do it on their own. Why cut in a partner when they could own the vast majority of the business they were building?\u00a0They ignored that advice and partnered with Centric Brands<\/a>, which manufactures and distributes dozens of brands including Joe\u2019s Jeans and Juicy.\u00a0\u201cWe didn\u2019t want to own 100% of something that we had to be 100% responsible for,\u201d Erin Foster tells me. \u201cThe smartest thing we have done in our career is pair ourselves with people who know what they\u2019re doing.\u201d<\/p>\n The combination of the Fosters\u2019 vision for the brand and Centric\u2019s industry know-how has made the clothing line, Favorite Daughter, a staple of cool-girl wardrobes around the country. They say the company is now well on its way to $100 million in annual sales.<\/p>\n Erin Foster (center) and Sara Foster (right) with a guest at a Favorite Daughter promotional event at Nordstrom Century City in Los Angeles.<\/p>\n Nowadays, there are dozens of ways a celebrity can become an entrepreneur, but for many of them, teaming up with an experienced partner is the obvious path. And there are no shortage of possible partners. All the major talent agencies have venture arms where, for their own slice of the equity pie, they\u2019ll work with clients to get their vision off the ground. Then there are companies that specialize in building businesses across various categories, like Give Back Beauty and Maesa in the beauty and haircare space, Collab for coffee, and Ari Bloom\u2019s A-Frame for socially responsible personal care and wellness brands.<\/p>\n No two deals are the same, but generally these are equity plays that don\u2019t require talent to invest any of their own cash upfront. A celebrity joining an existing brand could get as little as 5% equity in a business, while someone launching their own business or joining one that is less established can get as much as 50%. Bloom tells me A-Frame likes to split the business 50-50 with its celebrity partners \u201cso that we\u2019re both seeing the same motivations and the same returns.\u201d<\/p>\n While startups are a long-term play, celebrities will often get royalties or, in some cases, a cut of all sales associated with a specific capsule collection, to keep them incentivized until they can sell the company for a big payday.<\/p>\n At the 175-employee Beach House, all businesses are launched as joint ventures with the talent partner. There\u2019s no set formula for the equity split, but because Beach House is often bringing the idea to the celebrity and providing shared services\u2014legal, accounting, sales, compliance, distribution, etc.\u2014it typically only doles out minority stakes.\u00a0\u201cWe own \u2018em, we operate \u2018em,\u201d says Neff. \u201cWe\u2019ve created an absolute machine where we can incubate and create brands and rinse and repeat.\u201d<\/p>\n But that doesn\u2019t mean the celebrity can sit back and wait for an exit. If they want to be successful, they have to be willing to roll up their sleeves and get to work, from testing products to approving branding to promoting their brand every chance they get.<\/p>\n Before he was building a cheesesteak business with Cooper, Youseff helped put together Ryan Reynolds\u2019s deal for Aviation Gin. \u201cA big reference for that brand was watching George Clooney and Casamigos and how he lived that brand in every capacity of his life,\u201d says Youseff. \u201cHe\u2019d be on a boat wearing a Casamigos hat and serving Casamigos to his friends. He was not just selling it on a commercial, he was living it in his life. And you saw Ryan do the same throughout his journey with Aviation Gin to almost equal success. We want you to be doing something that doesn\u2019t feel like a chore. This should come from your passion, it should be fun for you.\u201d<\/p>\n The Foster sisters see the exits that some of their peers have had. They know they could probably sell Favorite Daughter for a lot of money. But Erin Foster says that\u2019s not the only reason they launched the brand. \u201cThis is one of the most fun parts of our career,\u201d she says. \u201cI love this tactile thing that we get to create. The idea that you could go into a meeting and say, \u2018I really need a shirt that\u2019s kind of split open in the front because I\u2019m sick of tucking it in.\u2019 And 11 months later it\u2019s in Nordstrom<\/a>. That\u2019s so cool to me.\u201d<\/p>\n The celebrity business bubble has been propped up on the belief that if you mix the right public figure with the right team and add the right support, you have a recipe for a successful business, one that one celebrity advisor says has a better chance at surviving than \u201cjust some random product that has to organically find its audience.\u201d<\/p>\n But for every Hailey Bieber\u2014who sold three-year-old beauty brand Rhode to e.l.f. Beauty for $800 million, plus earnouts that could boost the company\u2019s total valuation to $1 billion\u2014there\u2019s Kristen Bell and Dax Shephard, whose diaper startup Hello Bello filed for bankruptcy in 2023. Last year, Sephora<\/a> dropped TikToker Addison Rae\u2019s line from its shelves. And before Blake Brown Beauty, Lively launched and quickly shuttered lifestyle website Preserve.<\/p>\n A year after launching Florence by Mills with Millie Bobby Brown, Beach House sold its stake back to the\u00a0Stranger Things\u00a0star. She\u2019s since launched a fragrance with Give Back Beauty and a coffee with Collab\u00a0under the Florence by Mills brand name.\u00a0\u201cThe deal we struck with Millie was beauty centric, and I think she wanted to Florence a lot of things, so that didn\u2019t really align with our core principle,\u201d says Neff. \u201cWe did our job, we launched this thing very successfully at Ulta and we had a good run.\u201d He adds, \u201cknock on wood, we haven\u2019t had a dud yet.\u201d<\/p>\n So many startups have launched over the last five years that many close observers in the space expect there to be a shakeout soon. \u201cThe last few years before this were taking advantage of a trend,\u201d says Youseff. \u201cThis year is definitely much more focused on finding real opportunities to connect both with the talent who\u2019s launching these ventures and with the audience they\u2019re trying to serve.\u201d<\/p>\n Neff is still a big believer in launching brands with celebrity partners. But in perhaps a sign of the times, Beach House launched its most recent product without a celebrity founder by its side. Fragrance brand Noyz dropped last summer with sleek black and white packaging and scents like Unmute, which has hints of black plum, madagascar vanilla and crisp amber. \u201cFragrance is very magical, everyone\u2019s riding a white horse and their hair\u2019s perfect and the dude\u2019s doing a hair flip with an 18-pack; none of it\u2019s believable,\u201d he says. \u201cWe felt like there was no one telling real and raw authentic stories.\u201d<\/p>\n Ulta was a launch partner. \u201cIt was their biggest fragrance buy for a first-time brand ever,\u201d Neff boasts. And the marketing campaign featured dozens of TikTokers, including Tara Yummy, Madeline Argy and the Kalogeras Sisters \u2014 all of whom got paid but none of whom got equity.<\/p>\n A full year later, TikTok still appears to be crazy for Noyz. Did Beach House just disprove its own thesis of the celebrity brand? Perhaps it created a new one: Why limit yourself to just one famous partner when you can harness the power of many instead.<\/p>\nPairing talent with retail ideas<\/h2>\n
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\u2018Not everyone can pull this off\u2019<\/h2>\n
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Trading equity for expertise<\/h2>\n
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Successes and failures<\/h2>\n