CosmeticsDesign spoke with Lorne Lucree, Chief Innovation Officer at Voyant, about the new division and what it means in the broader landscape of indie brands.
Tell me a little bit about what this division is going to do.
The service model has entirely been built out for fast growth independent beauty brands with qualified funding. The idea is that, based on the level of funding, we're able to assess whether they will be a good partner for us and we will then partner with them, and then help them from a contract manufacturing standpoint.
That’s everything related to contract manufacturing; formulation, manufacturing, quality and scale, but specifically for the needs of indies. Based on the research, if you are a brand and you tell me what level of funding you've received, I can tell you exactly what's happening in your world right now, what decisions you're making and what challenges you're facing. I can also tell you what's going to happen over the years until you get acquired, which you're going to have to think about.
I don't think anybody has done extensive research to segment the independent beauty brand market in a way based on investment and funding. The idea is that you could come to us at whatever stage of funding you're at and we could match what you need from a formulation, manufacturing and scale perspective, and then grow with you until acquisition.
Where did the impetus for developing this division come from?
Before I joined Voyant three years ago, I led innovation for a fast growth independent beauty brand incubator for six years. I always thought there was this opportunity to create this ecosystem between brands, contract manufacturers, raw material suppliers, packaging partners, fragrance houses, etc., because everybody's working towards the same thing.
At Voyant we finally hit a point where we're thinking about what's next and where growth is going to come from. You can say you want to service indie brands, but it's such a unique market and what they need is a little bit different. We did hours of research and meetings with these brands.
Originally, we thought it would be about small runs and dedicating a plant to that. What we realized is the opening orders for a lot of these brands are 50,000 and 100,000 units. They are indie, in name and approach, but their quantities are fairly significant. It's matching the two of those together, this high touch approach up front, with the manufacturing scale on the back end.
What's the value as a contract manufacturer of building out a division that's prepared for a company to go from small up to ready-to-be-acquired?
If we're placing our bets more wisely with brands that are going to succeed through acquisition, then, of course, there's a high lifetime value on a partnership with a brand. If you were the first contract manufacturer to work with Glossier, you captured a billion-dollar unicorn.
I've always heard in the industry, whether you talk to raw material suppliers, fragrance suppliers or other contract manufacturers, that the indie market is hard to figure out and it's high risk. Then you build risk and failure into your business model.
There's got to be a better way for us to place our bets more wisely. Given the research and the segmentation, we're now able to target specific brands with specific criteria that are more highly predictive of their success.
Aside from revenue how are you going to measure success with this division?
From a relationship-building standpoint, the brands that we bring in that we're not currently working with will be a sign of success. In the past, we've been great at working with larger customers. But we haven't built out a strategic approach is with these indie brands.
We do work with some of them, and that's happened happenstance, it hasn't been on purpose. The ability to bring in new high-value brands for our portfolio will be a huge sign of success for us because it proves that the service model and the articulation of the value that we offer is resonating.
Our growth is really going to come from these brands that we can partner with early and grow with, through to acquisition and beyond. Having that connectivity, and being able to target them more clearly earlier on is going to drive value for both of us.
Is there anything else that you want to add or anything important that you feel we might have missed?
What’s unique, is our ability to address the friction points, formulation, but also manufacturing, scale, quality, regulations and all of that.
Also, the ability to be an immediate check of credibility and consistency when investors are looking at a brand. If you're a brand, and you're partnering with somebody of Voyant size and caliber, it immediately makes them more attractive for investment.
I've been in these guys’ shoes and girls’ shoes back in the day, and I’m building out the contract manufacturer of my dreams. I feel empathy for that anxiety, but also excitement about what's to come