Ipsy
Michelle Phan's beauty subscription service. From YouTube tutorials filmed in a bedroom to $500 million in revenue, a $500 million acquisition of BoxyCharm, and the first influencer burnout that anyone talked about.
Ipsy reached $500 million in annualized revenue by 2019, making it the largest beauty subscription service in the United States, with three million subscribers receiving personalized bags of beauty product samples every month. In October 2020, the company acquired its biggest competitor, BoxyCharm, for $500 million in stock, forming a parent company called BFA Industries with $1 billion in combined revenue and 4.3 million subscribers.
The brand was co-founded in 2011 by Michelle Phan, one of the earliest and most successful beauty content creators on YouTube, who built an audience of 8.9 million subscribers and 1.1 billion lifetime views while working as a waitress before turning that audience into a business. Phan’s story is also one of the first public examples of influencer burnout: in 2016, she disappeared from the internet for three years without telling anyone where she was going, and her “Why I Left” video became the most-viewed upload on her channel with over 13 million views.
At a glance:
| Founded | November 2011 (as MyGlam; rebranded to Ipsy September 2012) |
| Founders | Michelle Phan, Marcelo Camberos, Jennifer Goldfarb |
| CEO | Galen C. Smith (appointed September 2024; Camberos is Chairman) |
| Ownership | Private; TPG Growth is key institutional investor |
| Revenue | $500M annualized (2019); $1B combined with BoxyCharm (2020); ~$205M online store (2024) |
| Subscribers | 4.3M at peak (2020); 1.5M+ monthly currently |
| Total funding | ~$200M+ |
| Headquarters | San Mateo, California |
| Products | Ipsy Glam Bag ($14/month), BoxyCharm, Icon Box |
The Story
Michelle Phan was born in 1987 in Boston to Vietnamese refugee parents. Her mother arrived in America with less than $20 and no English and worked as a nail technician. Phan grew up in Tampa, Florida, surrounded by nail salon magazines and makeup, with a father whose gambling addiction led to her parents’ separation and a childhood defined by financial hardship and bullying at school.
She started a makeup blog in 2005 and began posting YouTube tutorials in May 2007 while working as a waitress. Her first tutorial, a seven-minute guide to natural-looking makeup, got 40,000 views in a week. In 2009, a “how to get Lady Gaga’s eyes” video hit one million views and made her a YouTube sensation. She became one of the first women to reach one million YouTube subscribers, and by the time she was ready to build a business, she had an audience that most beauty brands would have paid millions to reach.
The idea for Ipsy came from a trip to Thailand, where Phan saw makeup samples being sold from vending machines. She connected with Marcelo Camberos, who had been a founding executive at Funny or Die (Will Ferrell’s comedy company) and held an MBA from Stanford, through a company he had started called Real Influence that matched YouTube creators with brands. Jennifer Goldfarb, formerly of Bare Escentuals, joined as the third co-founder.
They tested the concept as MyGlam in November 2011, relaunched as Ipsy (from the Latin “ipse,” meaning “self”) on September 17, 2012, and crossed 500,000 subscribers by the end of their first year. The pitch was straightforward: take a beauty quiz, and Ipsy uses over 500 data points to match you with five deluxe-sample-size products in a collectible bag each month, all for $10 (now $14). By March 2015, they had one million paid subscribers, and by September 2017, three million.
The Strategy
The creator studio that asked for nothing in return
In 2015, Ipsy opened Open Studios in Santa Monica, offering beauty creators free access to production studios, audio and lighting equipment, editing suites, mobile apps, one-on-one mentoring from Phan and Ipsy staff, and VIP events. Creators retained 100% control of their channels and content with no obligation to Ipsy. The program evaluated applicants based on content quality, publishing frequency, and engagement, and it created a network of grateful, talented creators who promoted Ipsy organically because the company had invested in their careers without asking for anything contractual in return. This model predated the modern “creator economy” terminology by years.
Personalization as the product
Ipsy processed over 500 data points per subscriber per month and allocated 12 million products per year across its membership base, matching each person with samples tailored to their skin type, product preferences, and brand favorites. The personalization was the value proposition, not the products themselves, because every beauty subscription box was sending samples. What Ipsy offered was the promise that those samples would be relevant, which kept subscribers from canceling.
BoxyCharm for $500 million
In October 2020, Ipsy acquired BoxyCharm, the largest provider of full-size beauty product subscriptions, for approximately $500 million paid mostly in stock. BoxyCharm, founded in 2013 by Yosef Martin in Miami, had been bootstrapped with $500,000 from Martin’s previous liquidation business and grown to $500 million in seven years with no outside funding. The combined entity, BFA Industries, had 4.3 million subscribers and $1 billion in annual revenue. In February 2023, the two brands merged under the Ipsy umbrella.
The burnout that no one had a word for
In 2016, after ten years of content creation, Michelle Phan disappeared from YouTube and public life without warning. Professional colleagues did not know where she was. Some fans speculated she had died. She later described collapsing under the pressure of running an “empire” before age 30 and maintaining a perfect online image. She returned in September 2019 with a casual video titled “Hello :)” and eventually left Ipsy to focus on EM Cosmetics, a brand she had originally launched with L’Oreal in 2013 (which failed due to quality issues), bought back through Ipsy in 2015, and relaunched successfully in 2017. Her burnout story became one of the first widely discussed examples of the mental health toll that influencer careers can extract.
The Numbers
| Year | Revenue | Notes |
|---|---|---|
| 2015 | ~$150M annualized | 1.5M subscribers |
| 2019 | $500M annualized | 3M+ subscribers; more than tripled since 2015 |
| 2020 | $1B combined | Ipsy + BoxyCharm at merger |
| 2024 | ~$205M | Online store only; reflects subscriber decline |
Subscriber trajectory: 500,000 by end of 2012; one million by March 2015; 2.5 million by April 2017; three million by September 2017; 4.3 million combined at the 2020 BoxyCharm merger; approximately 1.5 million monthly currently.
Funding: Approximately $200 million raised in total, including a $3.8 million seed and Series A, a $100 million Series B from TPG Growth in September 2015 at an approximately $800 million valuation, and a $96 million growth round from TPG in February 2022.
BoxyCharm acquisition: $500 million, paid mostly in stock. Yosef Martin, an Israeli immigrant, had bootstrapped the company from $500,000 to a nine-figure exit in seven years with zero outside funding.
The decline: The 2024 online store revenue figure of approximately $205 million, down significantly from the $1 billion peak, reflects post-merger subscriber churn, the broader decline in beauty subscription boxes as a category, and increased competition from retail sampling programs. Leadership has turned over multiple times: Camberos stepped down as CEO in January 2023 to become Chairman, and Galen Smith, former CEO of Redbox, was appointed CEO in September 2024.
Controversies
Post-merger quality decline
After the 2023 merger of Ipsy and BoxyCharm under a single brand, longtime subscribers of both services reported declining product quality, with bags increasingly filled with less recognizable brands. Customer complaints centered on missing items, billing problems, expired products (some more than a year past expiration), damaged packaging, shipping delays of up to a month, and difficulty reaching customer service or canceling subscriptions. Review platforms show a pattern of dissatisfaction that accelerated after the consolidation.
Michelle Phan vs. Ultra Records
In July 2014, Ultra Records sued Phan for copyright infringement, alleging she used 50 tracks in her YouTube videos without permission and seeking at least $15 million in damages. Phan countersued, claiming she had received written authorization from an Ultra manager in 2009 to use the songs in exchange for crediting the artist and including iTunes purchase links. The case settled in August 2015 with undisclosed terms.
What You Can Learn
An audience is the most valuable startup capital there is. Michelle Phan built 8.9 million YouTube subscribers and 1.1 billion views before she launched a single product, and that audience became the foundation of a $500 million business. For any online business, the order of operations matters: building an audience first and a product second is a more capital-efficient path than the reverse.
Invest in creators without strings, and they will invest in you. Ipsy Open Studios gave creators free production resources with no content obligations, no channel control, and no exclusivity requirements. The creators promoted Ipsy because they were genuinely grateful, not because a contract told them to, and that authenticity is something influencer marketing budgets cannot buy.
Burnout is a business risk, not a personal failure. Michelle Phan’s three-year disappearance removed the founder and primary brand ambassador from the company she built, and the fact that Ipsy survived is a testament to the operational infrastructure Camberos and Goldfarb had put in place. For any creator-led online business, the founder’s mental health is as critical to the company’s survival as its revenue, and planning for the possibility that the founder needs to step away is not pessimism but responsible business design.
Frequently Asked Questions
Who founded Ipsy?
Michelle Phan, Marcelo Camberos, and Jennifer Goldfarb co-founded Ipsy in November 2011 as MyGlam, rebranding to Ipsy in September 2012.
How much does Ipsy cost?
The Ipsy Original Glam Bag costs $14 per month and includes five deluxe-sample-size beauty products in a collectible bag, with an estimated value of up to $70.
Is Michelle Phan still involved with Ipsy?
Phan resigned from Ipsy to focus on EM Cosmetics, a makeup brand she originally launched with L’Oreal in 2013, bought back through Ipsy, and relaunched independently in 2017. She is no longer involved in Ipsy’s day-to-day operations.
What happened to BoxyCharm?
Ipsy acquired BoxyCharm for $500 million in October 2020, forming parent company BFA Industries. In February 2023, the two brands merged under the Ipsy umbrella, and BoxyCharm now exists as a tier within Ipsy’s subscription offerings.
How many subscribers does Ipsy have?
Ipsy had 4.3 million combined subscribers at the peak following the BoxyCharm merger in 2020. Current estimates place monthly subscribers at approximately 1.5 million, reflecting the broader decline in beauty subscription boxes as a category.
When was Ipsy founded?
Ipsy was founded in November 2011 as MyGlam by Michelle Phan, Marcelo Camberos, and Jennifer Goldfarb, then rebranded to Ipsy on September 17, 2012. The name comes from the Latin “ipse,” meaning “self.”
Who owns Ipsy?
Ipsy is owned by BFA Industries, the parent company formed in October 2020 when Ipsy acquired BoxyCharm for $500 million in stock. The two brands later merged under the Ipsy umbrella in February 2023. TPG Growth is the key institutional investor.
What is Ipsy’s revenue?
Ipsy reached $500 million in annualized revenue in 2019 at its peak as a standalone brand, and the combined Ipsy and BoxyCharm entity hit $1 billion in 2020. The 2024 online store revenue is approximately $205 million, reflecting subscriber churn and the broader contraction of the beauty subscription category.
What is Ipsy’s valuation?
Ipsy was valued at approximately $800 million in its September 2015 Series B led by TPG Growth, which is the most recent publicly disclosed valuation. The company has remained private through subsequent funding rounds and the BoxyCharm acquisition, with no updated valuation made public.
Sources
- PR Newswire, “Beyond the Subscription: Ipsy Reaches Half a Billion in Revenue,” 2019. Revenue milestone, subscriber growth.
- BusinessWire, “IPSY Acquires BoxyCharm, Forming BFA Industries,” October 2020. Acquisition details, combined revenue and subscriber count.
- TechCrunch, “Ipsy launches Shopper as it hits 3M subscribers,” September 2017. Subscriber milestones, e-commerce expansion.
- Fortune, “Michelle Phan and Ipsy Open Studios,” June 2015. Creator studio model, investment in creators.
- Variety, “Michelle Phan Relaunches YouTube Channel,” September 2019. Burnout, disappearance, return.
- PR Newswire, “Ipsy Appoints Galen C. Smith as CEO,” September 2024. Leadership change, current management.
- Hollywood Reporter, “YouTube Star Michelle Phan Settles Copyright Lawsuit with Ultra Records,” August 2015. Ultra Records lawsuit and settlement.
- Reforge, “How an $800M Company Grows with Influencer Content,” 2020. Growth strategy, creator network mechanics.
- Wikipedia, “Michelle Phan”. Biographical details, YouTube statistics.
- ECDB, “Ipsy Revenue 2024”. Current online store revenue estimate.