The company behind Patchology was an early pioneer in advanced transdermal patch technologies for drug delivery, and after developing and patenting several inventions in the space, we recognized a massive opportunity to apply these innovations to the beauty market. Consumers have always looked for targeted skincare solutions, and while there are many innovative ingredients in skincare, if they can't be delivered to the skin in sufficient quantity, they won't achieve the desired effect. Patchology was founded to meet this need for targeted delivery of skincare ingredients for faster, better results.
Brand Founder: Chris Hobson
Founded: 2014
Leadership:
2023 Full Year Expected Revenue Range: $20MM to $30MM
Category: Skincare
Distribution Channels: Prestige, Mass, Amazon, Boutique, Department Store, Professional
Funding Rounds: Family Office
Notable Advisors: Robb Akridge, Eleni Shipp, Dr. Dana Stern
What are some of your key business initiatives for 2023?
Our top three initiatives in 2023 are winning at shelf, accelerating innovation, and building community. At shelf, we are investing in packaging, display, and innovation to drive sales velocity even higher than our +30% year-over-year averages. We are launching two meaningful innovations this year: our "iced" eye gels and face masks as well as our RareCycle sachets, which push the envelope for sustainability in the sheet mask space. And our community is growing through a variety of initiatives on social media and our direct-to-consumer (DTC).
What are you most proud of having accomplished?
Patchology has developed a strong omnichannel presence, with 200 retail partners and over 10,000 doors of prestige, and specialty distribution including Ulta, Sephora (EU), Nordstrom, Bluemercury, SpaceNK, Mecca, and Douglas. Our products are generally rated 4.3 stars or higher, and our Net Promoter Score (NPS) consistently runs around 75—higher than Apple or Ritz Carlton. The business is profitable and enjoys high gross and contribution margins relative to our peers. But what I'm most proud of is our team and culture. We are a small but mighty and diverse group of both industry veterans and relative newcomers that have bonded on a common mission; we've built this culture and commitment in a unique work-from-home environment that respects each person's life away from work.
What has been the biggest surprise since the brand was founded?
The sustained power of physical retail. DTC was just getting going in 2014, and then absolutely exploded in the 2016 to 2020 timeframe, with thousands of new brands and tens (hundreds?) of millions spent fighting to acquire customers online. Yet after all that, about 70% of industry volume is still sold in physical stores. This will change over time, but the surprise is that despite all the hype, people still like to physically experience products and brands in stores.
What aspect of your brand DNA fuels your competitive advantage?
For Patchology, it all comes back to our transdermal patch heritage. We are still the only eye patches and sheet masks to offer results in just five minutes and a variety of patch and mask offerings that are truly differentiated from the pack.
Please share your insight on the future of the beauty industry.
In the near term (the next one to two years), we are in for a period of intense consolidation where the number of brands will be reduced drastically. There are just too many brands chasing a finite amount of consumer attention and shelf space, and a shakeout is necessary. The brands that survive and thrive will be the ones that have always offered more than just cool branding, satisfactory products, and a sugar high on social media. True innovation, superior product efficacy, and consumer value don't go out of style.
What is the best piece of advice you’ve been given?
There was a time early in the founding of the brand where I was tempted to give up. When I sat at a coffee shop and explained the challenges to one of my career mentors, she said, "It sounds trite, but once you start, you can never give up. The only reason a new brand (or any entrepreneurial venture) will fail is if you let it." I'm really glad she helped keep me moving forward.
Paying it forward, what advice would you give to someone contemplating launching a beauty brand?
Play the long game. We'd all love to catch lightning in a bottle and scale a brand to hundreds of millions in just a few years, but from a pure probability standpoint, that's the equivalent of buying a lottery ticket. Developing truly innovative products, scaling a business, and building brand equity takes time if done well. Be prepared for the long haul. And enjoy every minute of it.
If you could change one thing in the beauty industry, what would it be?
Not much, honestly. I love the financial aspects of the category—like high margins, ability to grow quickly, and how resilient it is even through difficult economic times. I love that smart, creative people can build meaningful brands. I love how people in the industry are happy to help each other. If anything, I think I would change the cynical claims that some people make that our beauty products are "toxic." The fact is, they're safer than the vast majority of products people use every day, and just like advertisers are forced to abide by rules and regulations when selling their products, those who make false claims about how bad beauty products supposedly are, should be held to the same standard.
