- In 2012, we invested $6,000
in our brand Huda Beauty.
Five years later in 2017,
we got our valuation at over a billion dollars.
[inspiring music]
Hi, I'm Huda Kattan,
founder of Huda Beauty.
And I'm going to share with you guys,
how I made my first million selling makeup.
So my first big money move
when I was starting Huda Beauty.
It was definitely a little bit of a risk for me.
But I asked my sister
if I could borrow $6,000.
I ended up using the $6,000 to buy lashes.
And I bought, you know,
I think about 7,000 pairs of lashes at the time.
And when I first found out about false lashes.
I remember being like,
"This is like the best kept secret.
I need to tell everyone about it."
And so I started blogging about it all the time.
And people were like,
"Where do you get your lashes?"
And I was like, "I'm making them.
I'm literally cutting, shaving,
gluing on top of each other.
I'm making them."
It was totally really scrappy,
the way that we did it.
My sisters helped me find a manufacturer.
I found a printer to make packaging for me.
And you know,
that actually ended up creating
our first lash that you see today.
I got a meeting with,
you know, one of the Sephora GM's.
I definitely laid it on really thick.
And I sold this vision of our views
and our, you know, our blog was doing.
And then what our brand could be.
And how he could be the one
to help me launch the brand.
And, you know, he took a chance on me.
And it paid off really well.
When we launched our lashes.
It was a bit of a moment
because it was a risk, you know.
No blogger had started a makeup line
at that time.
And when we sold our lashes,
we sold out immediately.
And I remember sitting there
with a team at Sephora.
And they were like,
"You're selling lashes
like a grocery store sells bread."
You know,
when we launched the first collection of lashes.
We got a check.
It was 125,000 dirhams.
Which means it was approximately about $35,000.
And so we would get, you know, a lump sum.
Like we got our first $35,000.
And we would then put in the order for the lashes,
which would take months to get here.
So we would be out of stock for like nine months
just because we were trying to get payment.
Then we were trying to order the lashes.
We were trying to get them in,
trying to get them shipped,
and then sent to Sephora.
It was just a complete nightmare
in the beginning.
So my second big money move
was getting rid of our distributor.
Which was really risky
because what that meant was,
we had to essentially do our distribution.
The reason why we decided
to get rid of our distributors.
Because one,
they were taking 90 days to pay us.
And we were only selling at Sephora.
And then two,
we weren't making that much money.
You know,
we were only making about 27%
of the total product price.
And then we also had
our cost of goods on top of that.
So we are basically making almost no money.
It was something that was good in the beginning
because we just didn't have the capabilities
to do our own logistics.
So I had to hire a team,
get a warehouse.
All the complications
of starting your own logistics.
Which I didn't understand at the time.
And the month that we got rid of our distributor,
we increased sales by 500%.
So they were really holding us back, tremendously.
You know, and we had exponential growth
month on month on month.
So that really was the catalyst
for our brand.
Products don't just show up in stores.
It is so complicated.
You need to actually get them
to a distribution center.
Called a DC.
And then you have to ship them
over to the retailers.
The way that products move from the manufacturers
to your warehouse,
to the distributor's warehouse.
Is really, really complex.
And sometimes just having a partner
do that for you.
Even though they're going to take some of that money,
is really helpful in the beginning.
My next big money move,
which was a really big one for us.
Was, you know,
when we actually started to sell makeup.
We didn't know it would be color cosmetics.
So when we did end up
doing color cosmetics in 2016.
That's when the brand really became a brand.
We decided to launch with lip contour,
lip liners.
It was something that I felt
could kind of go a little viral.
We could get sales easier than, you know,
something like complexion.
For me,
complexion was like the end all be all.
When you do complexion as a makeup brand,
you are serious.
I remember when we talked to the manufacturer,
it was a German manufacturer.
And we were like,
"Oh, you know,
we want like two years worth.
Give us 55,000."
I think they were really surprised.
We were surprised,
we sold all of them in a week.
So by 2017,
Huda Beauty was starting to make majority of its money.
We had finally gotten into a groove
of the way that we wanted to launch products.
We had healthy cash flows.
So we were able to actually, you know,
not just launch two or three products in the year.
We were able to have a few products that entire year.
For instance, we had our foundation launch.
We had our 18 well eyeshadow palette,
our big palette.
And we also launched for the first time,
our mini eyeshadow palettes.
Which were like the first of its kind as well.
We had a cadence.
It was like every two months
we had a product launch.
That was a big deal for us.
It was like we were a professional company.
Pre-COVID, the beauty world was just booming.
And because of that,
there was also a lot of chaos.
You know, you didn't necessarily
have to be very focused on your financials.
You didn't have to be focused
on your efficiency in your business.
And I remember as soon as COVID hit,
the first thing I told my team.
Was we need to 80/20 our business.
I want to remove anything
that is not making money.
And I want to make sure
that the things that do make money.
We're really owning
and we're focusing on.
So 80/20, it's a philosophy that I love very, very much.
It's also called the Pareto Principle.
Out of all of the money
that you're producing, right?
The top 20 consumers
are probably producing 80% of your sales.
So it's an amazing philosophy to think about.
And we really looked at 80/20
in the entire organization.
And it was something that we later on,
saw a lot of businesses did.
And one of the things that we realized
is definitely there were way too many meetings.
Wasted time, inefficiencies,
too many product launches,
too many social plans.
It was everything.
It affected our entire business.
It was actually a thing last year,
everybody was just like,
"We're 80/20ing
We're, 80/20ing."
It was a big thing in the business.
And it resulted in so much added efficiency
in the organization.
And because of that,
you get maximum impact.
If you're doing less,
but you're focusing more.
And you're doing more with great power,
you get so much more within the business.
And you remove a lot of chaos.
If I was going to leave you guys
with one thing today.
I would definitely say my biggest money tip,
would be to not underestimate
what you can do for free.
A lot of times we think we need to do everything
in a really polished form.
And being scrappy
is one of the most amazing qualities
you can have as a founder.
And I hope that you guys can take that
and create some magic.
Thank you so much Glamour for having me.
And I'll see you guys next time.
Bye guys.