Gregg Renfrew Is Making Counter Moves in Clean Beauty

Key Takeaways

Selling a majority stake in a company can lead to loss of control and dilution of its founding mission.
The 'clean' beauty industry faces challenges from 'clean washing' and persistent regulatory loopholes, notably the fragrance loophole.
Rebuilding a business requires confronting identity collapse, demonstrating humility, and fostering transparent communication to regain trust.
Entrepreneurs should prioritize profitability and autonomy over high valuations, conducting thorough due diligence on potential partners.
Trusting one's intuition as a founder and advocating for operational reality over purely financial metrics is crucial for long-term business success.

Following Beautycounter's sale to Carlisle in May 2021, the company faced difficulties as consumer behavior shifted post-pandemic.
The new CEO, hired in late 2021/early 2022, made decisions that alienated the sales force, including an Ulta partnership.
Abrupt changes to the commission structure, made without adequate notice or collaboration, led to a significant loss of trust among brand representatives.
The Ulta deal, which placed products at the same price point with better shipping, undercut the direct sales model and shifted the brand from purpose-driven to transactional.

Beautycounter went into foreclosure after becoming unprofitable, prompting the banks to offer to sell the business back to its founder.
The founder, Gregg Renfrew, repurchased the company from foreclosure within 48 hours using personal savings and emergency investments.
Following the buyback, Renfrew made the difficult decision to fire most employees due to a lack of operating capital, leading to public backlash.
She ultimately decided to shut down the company on May 1, 2024, believing it needed to 'die to be reborn' in a more viable way.

After being asked to leave Beautycounter, Gregg Renfrew experienced an identity crisis, feeling a loss of self separate from her CEO role.
She engaged in healing practices and reflected on her core values, focusing on empowering women and improving lives.
Renfrew decided to launch a new company, 'Counter', instead of a 'Beautycounter 2.0', recognizing market evolution and her personal growth.
The original 'Beautycounter' name had limitations, including challenges in marketing to men and the subsequent dilution of the 'clean' label by retailers.

The beauty industry now faces 'clean washing,' replacing greenwashing, where brands use misleading 'clean' claims.
Despite MOCRA (Modernization of Cosmetics Regulation Act) passing in 2022, significant loopholes persist in consumer protection.
The 'fragrance loophole' remains a major concern, allowing manufacturers to include undisclosed toxic chemicals under a single label.
Consumer awareness of toxins has increased, but deregulation efforts by the administration conflict with the goal of removing harmful substances from products.

Common chemicals of concern include parabens, EDTA, PEGs, and formaldehyde, which can disrupt endocrine and neurological systems.
Loopholes allow products to claim 'preservative-free' even if raw materials were preserved prior to bottling.
Less than 10% of chemicals introduced into commerce have been tested for human safety, creating a 'Wild West' scenario for consumers.
Consumers are advised to shop fragrance-free to avoid phthalates and use resources like the Environmental Working Group's Skin Deep database for informed choices.

The founder is re-launching a beauty brand, Counter, with a community-based commerce model aimed at empowering women to share information.
Rebuilding trust with the sales force is a priority, approached through honesty and action rather than just words, with some past members returning.
Counter's evolving business model moves away from traditional multi-level marketing (MLM) structures by removing team building.
The focus is on leveraging community and individual advocacy through a community-centric affiliate model, contrasting with D2C ubiquity in retailers.

Current business challenges include intense competition from numerous brands claiming to be 'clean' in a crowded market.
The company faces the ongoing challenge of regaining the trust and support of former representatives and customers after past events.
Rebuilding relationships with old vendors and manufacturing partners who were owed money required difficult negotiations and requests for a second chance.
The founder faces public criticism for actions she did not personally take, highlighting the complexities of earning back trust after a company's collapse.

The founder advises entrepreneurs that selling controlling interest means relinquishing control, despite involvement, and cautions against unrealistic expectations of autonomy.
She now prioritizes profitability and control over revenue growth and high valuations, recognizing the pitfalls of chasing investor expectations for 3X returns.
Future business ventures will involve clear deal terms, careful consideration of downsides, and proactive succession planning, aiming to build long-lasting businesses.
The founder emphasizes trusting her own intuition and vision, rather than external advisors, especially after past experiences where her gut instincts were overruled.

The founder has prioritized work-life balance, integrating self-care, exercise, sleep, and non-negotiable family time into her routine.
She highlights Beautycounter's 'never list' and warns against harmful ingredients like PEGs, parabens, EDTA, oxybenzone, and avobenzone.
Consumers are advised to avoid spray sunscreens containing oxybenzone and avobenzone, which Hawaii has banned due to environmental and health concerns.
True clean beauty requires comprehensive work beyond ingredient lists, including packaging integrity, ethical sourcing, and worker safety in ingredient harvesting.