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Forbes article: How 20-Year-Old Kylie Jenner Built A $900 Million Fortune In Less Than 3 Years

Ray Goslin

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Spot on. Forbes is putting it that she is self made. She did use $250,000 of her own money she got from modelling, however she's riding on the coattails of celebrity. She may have been successful on her own, but not with the speed and magnitude.
 
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Envision

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Are we not going to talk about how she only has 5 employees? And the whole brand is private labeled and managed by her mom for a 10% fee?

You can hate all you want but that 21 year old is clearing nine figures/year in net income. That's incredible, famous or not.
 

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She has been spoon fed through life...

not that impressive.

She's worth more than the rest of the idiots that spoon fed her combined now... Good for her making the most out of her situation. I see no issue with her success.
 

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rollerskates

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The people buying her sh*t are celebrity star gazers who think if they carry the same thing she tweets they will be like her. It's a unique moment in time, predicated less on value and more on celebrity.

Agreed.

She actually found a need in the market & filled it

Sort of. I'm not sure of the quality of her products but I'm assuming it's decent because of her factory being located here. There are plenty of of high end cosmetics to be had, but none that seem as cool. I am sure my Lancome products are just as good but they're not cool like Kylie.

It might be beneficial to analyse her tweets and Instagram to see what we could emulate from her to our own businesses.

THIS. Do this.

Overall, good for her, even if she started far ahead of a lot of entrepreneurs. The Kardashians overall make me cringe, though. They're so gaudy.
 
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lowtek

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Surprised at all the jealous hate in here, even from respected members. I can see that the script still has you.

Let's look at this objectively, shall we?

With respect to "privilege", it's a given she has celebrity due to her family name, however, how many people come from famous families and join the billi club in less than 5 years? It's exceedingly rare.

Let's subtract the "privilege". Of the people who make it out of poverty and into tens of millions, say by joining a sports ball league, how many end up bankrupt within a matter of years of retiring? A significant portion. So much so that it is a trope (see: East Bound and Down).

What you identify as "privilege" is in fact often an albatross around the neck of those who grow up in the shadow of their wealthy family. The lack of a struggle for resources often leads to the degradation of one's character, and this shows itself in the lack of work ethic, ambition, and persistence. Precisely the qualities one needs to succeed, even with a head start.

That's not even taking into account the parasites that such "privilege" attracts. People who will manipulate and tempt the young and wealthy into self destructive behaviors, for various reasons. Resisting the peer pressure to pop bottles and snort rails when you've grown up with everything handed to you on a silver platter is the very definition of character. Or are you going to argue that a good portion of youthful celebrities do not in fact end up drug addicted and ruined later in life?

Looking at it scientifically, this is a multivariate problem. If it's celebrity that is the determining factor, then why is Kim not approaching the billi club, despite being in the limelight for a longer period of time? Why do the other siblings not have anywhere near the level of success?

Clearly, something else is at play.

For those who think "oh it's easier to make money if you're already rich". If MJ dropped by and gave you $10,000 today - right this moment - could you turn it into $1m within a few years? Forgive me if I'm skeptical.

While I honestly wish the whole family would disappear from the public eye, and I agree that they represent much of what is wrong with the modern mindless consumer culture, I will not allow that to blind me to the fact that this young woman has something I do not.

And it's not her privilege.
 

HackVenture

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What I meant, is to analyze the psychology behind the tweets and posts. What gets the people going? What types of posts get shared more? Stuff like that.

That's the thing, she could post something and have people rolling on the floor laughing and exclaiming how funny she is, and I could copy and paste the exact same thing and have people calling the police on me or more likely, I'll just get crickets.

Celebrity is more art than science IMO.
 

TheOrchestrator

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That's the thing, she could post something and have people rolling on the floor laughing and exclaiming how funny she is, and I could copy and paste the exact same thing and have people calling the police on me or more likely, I'll just get crickets.

Celebrity is more art than science IMO.
She's simply leveraging one of her assets: influence. Her influence is worth millions, and she knows that, and uses it well. She's knows how stupid the whole thing is, but she also knows how much value it generates for her as well as others who make money off of her. So yeah, I think there's still a lot of science to this.
 
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rpeck90

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Great for her, I read the article - and several others - when it hit.

The big thing I would say is that she's not worth anywhere near a billion dollars. Her company may have lifetime revenues of $600m+, but that's not profit.

Spatz - the main company behind the operation (who design, create & package the products) - are taking a massive chunk of every sale (some thinking 50%), with Kylie's mother taking another 10% "management fee" on her remaining profits.

Even at a 50% margin, it's still a decent operation... but not sustainable in my eyes:
  • The *sole* method of customer acquisition is Kylie's instagram profile
  • She has no "pedigree" in the beauty business (an "economic moat" as Buffet would call it)
  • The majority of her sales are from the "selfie generation" (IE the same people buying "Jake Paul" merch)
  • Sales growth is slowing. Whether that negatively affects the top line is yet to be seen
  • If Spatz are as integral as I think they are, she's not really building her own business, but theirs. You might throw the "Apple/Foxconn" argument out here, but Spatz actually seem to develop the products (which means they own the IP for all the formulas etc).
My analysis was very similar to everyone else's (it's an indication of the further decline of American/Western culture) - but from a business perspective, it also has a number of flaws.

I would peg her net worth solely to her Instagram account. 110m followers is monumental; what's she's really done is find a product many of them will hand over money for (which is very good). Without that (IE if her products were up against L'Oreal, Mac or VS in a retail setting), I think she'd lose.

My perception is that her "lip kits" are a nice "filler" for a market constantly looking for the next thing. "Overlining" has been a thing for a while as have lip fillers... once this "trend" becomes unfashionable, I think her revenue will shrink with it.
-
What would impress me would be if she worked on the underlying formulas for the products, and if she used this as a means to lower production costs & develop genuinely valuable IP of her own. She could then use that to build a brand independent of her name/face, which would justify a higher valuation.

But - like many of the "dropship" idiots I see on a daily basis - her lack of real business experience prevents her seeing the bigger opportunity. I believe her to be worth between $20m and $60m.
 

Miorin

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Richard Peck, you here? I'm a big fan of you and ludvig. Great work on TUCS.
-

What I'm trying to undestand is the obssession with the Kardashian family. I can't get it.
 
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Red

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(it's an indication of the further decline of American/Western culture)
I find her success more of a sad commentary on slow lane America than I do on her business prowess.
THe dumbing down of America has been completed

Every. Single. Generation. has said this about our country. Every aging generation bags on the following, younger ones.


You know what's also a commentary on the state of American culture? We give. We donate, now more than ever, to charitable causes & non-profits working around the world to help those in need. When a disaster happens in another part of the world, we take action. We do what we can, with the resources we have. More people than ever give, despite having "less" compared to previous generations.

This country is more accepting, loving, inclusive & considerate than it was when I was growing up in the 90's. Holy shit, so much more. Whether it's the LGBT community, animal welfare or environmental conservation, our youngest generations best understand we're all in this together & we need to take care of ourselves & our resources.


That is the state of this country & our culture. Yeah, we still have our issues but it doesn't negate that human beings are better now than ever before. We all see what we choose to see, myself included. But that's what I see.
 

Argue

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Pat McGrath Labs passed Kylie Cosmetics.

Makeup/beauty niche is abundant.
 

HackVenture

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She's simply leveraging one of her assets: influence. Her influence is worth millions, and she knows that, and uses it well. She's knows how stupid the whole thing is, but she also knows how much value it generates for her as well as those who make money off of her. So yeah, I think there's still a lot of science to this.

For sure, I think she's awesome, not taking any credit away from it, what my point is it's not Science and what I mean by that is you can't say

Step 1: Do this
Step 2: Do that
Step 3: You WILL get this

Cos influence and celebrity doesn't really work this way, otherwise gangnam style, William Hung, PPAP, the Chewbacca lady etc wouldn't be such massive hits.

I'm not saying they're "just lucky", I'm saying they're not replicable, so it's dangerous to treat these examples as role models blindly.
 
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Ray Goslin

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Richard Peck, you here? I'm a big fan of you and ludvig. Great work on TUCS.
-

What I'm trying to undestand is the obssession with the Kardashian family. I can't get it.
They're brilliant at marketing being famous for no reason!!
 

Andy Black

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you can't say

Step 1: Do this
Step 2: Do that
Step 3: You WILL get this

Cos influence and celebrity doesn't really work this way, otherwise gangnam style, William Hung, PPAP, the Chewbacca lady etc wouldn't be such massive hits.

I'm not saying they're "just lucky", I'm saying they're not replicable, so it's dangerous to treat these examples as role models blindly.
What if Step 1 was to find a celebrity instead of become a celebrity?
 

Andy Black

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Makeup/beauty niche is abundant.

And evergreen.

And recurring.



I wonder if she’ll create the next trend her audience wants to be in on, and then capitalise on it?


She sold $25 lip “packs” (sorry... I don’t know wtf she sold).

Are they one off purchases?

Was it lipstick? Is lipstick consumable?

Can she turn those first-time buyers into customers who buy whatever she’s selling every month?

Kinda like how Messi and Ronaldo have replica shirts out so thousands of little kids can wear them and believe they’re just a bit better at football because of it? And how the football clubs will change strips every year to make it a recurring payment form those following their idols?



Can she sell something else to those people who raised their hands as buyers? (The first purchase is a test right?)

She now has a feck off big list of buyers in that 110 million IG following.

Anyone want to bet her camp is not doing something with that list, or do we think it was just a flash in the pan?
 
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Andy Black

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Surprised they're not doing a subscription box
What? You mean it’s not?

Nooo... don’t make me Google what they’re selling.


I had to go scan the article to understand what was being sold.

Here’s the extract:

“Kylie Cosmetics launched two years ago with a $29 "lip kit" consisting of a matching set of lipstick and lip liner, and has sold more than $630 million worth of makeup since, including an estimated $330 million in 2017.”


I presume “launched two years ago with a $29 “lip kit”” means there’s other products by now?


EDIT: I wonder what the search volume for “kylie jenner lip kits” is? And I wonder if it went up much after that Forbes article?

I wonder who’s advertising on it and using her celebrity status without even getting her agreement?

I wonder what they’re selling, given the searcher was likely a young lady looking for a lip kit from Kylie Jenner?
 

Argue

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@Andy Black she's dominating the market, indeed.

I'm not sure if this is true/confirmed, but my lady says that Kylie is going to enter the lingerie space. My girl loves Kylie and has several Kylie products.

I keep trying to tell her we need to be producers, not consumers lmao.
 
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ApparentHorizon

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What? You mean it’s not?

Nooo... don’t make me Google what they’re selling.


I had to go scan the article to understand what was being sold.

Here’s the extract:

“Kylie Cosmetics launched two years ago with a $29 "lip kit" consisting of a matching set of lipstick and lip liner, and has sold more than $630 million worth of makeup since, including an estimated $330 million in 2017.”


I presume “launched two years ago with a $29 “lip kit”” means there’s other products by now?


EDIT: I wonder what the search volume for “kylie jenner lip kits” is? And I wonder if it went up much after that Forbes article?

I wonder who’s advertising on it and using her celebrity status without even getting her agreement?

I wonder what they’re selling, given the searcher was likely a young lady looking for a lip kit from Kylie Jenner?

Wait, I got my gf to get me the right keywords.

She calls it a monthly bundle, not a subscription box. Apparently that has a cheap connotation.

Oh and it retails for $100/mo hahaha

Whereas the competition is around 30$ max

well played
 

Andy Black

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Wait, I got my gf to get me the right keywords.

She calls it a monthly bundle, not a subscription box. Apparently that has a cheap connotation.

Oh and it retails for $100/mo hahaha

Whereas the competition is around 30$ max

well played
Well played indeed.

Interesting if it’s actually $100/mth, instead of $99/mth. She then *wants* to make people think of the bigger number, maybe because they feel they’re in a more exclusive club?
 

Niptuck MD

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The-J

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She has been spoon fed through life...

not that impressive.

Except her relatives are only millionaires. If you start with $1m (or $100m for that matter) and you end up with $900m, that's not being spoon fed. That's Fastlane level returns.

Her dad was Bruce Jenner, a great athlete and millionaire. He (now she) is not a billionaire. Her mom is Kris Jenner, who was married to a millionaire lawyer Robert Kardashian before being married to Bruce.

Her half sisters (including Kim Kardashian, the most famous one of the bunch) are not billionaires.

So tell me, good sir: if someone gave you $100m right now and you had 3 years to turn it into $900m, would you be able to do it? If so, then maybe you should start a fund.
 

MJ DeMarco

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