After going through two smaller rounds of layoffs in 2023, premium skincare line Matter of Fact made all remaining employees redundant last week, a person with knowledge of the matter told The Business of Beauty. It had around 13 employees, including its head office and field team.
The company, which was founded in 2018 by Paul Baek, had raised $16 million in venture capital over two years, including a $6 million round that was secured in March 2023. According to documents seen by The Business of Beauty, the company attempted to raise fresh funding at the end of last year. A representative for Matter of Fact declined to comment.
Though it added Sephora as its first stockist in August 2023, sales failed to meet expectations, the same source confirmed. Matter of Factâs hero product is its Brightening + Firming Serum, which uses patent-pending ingredients and retails for $92.
Securing a top retailer contract, while a boon for exposure and sales, can cause profit margins to narrow as the company lacks economies of scale. Moreover, young consumer brands â especially venture-backed ones â are expected to grow fast, both in terms of their digital audience and also their market share, which is harder to do in this economic climate.
Matter of Factâs growing pains are being felt by many early-stage brands across the industry, as borrowing and digital advertising costs have spiked and category competition stacks up. Young companies are also more exposed to the effects of interest rate changes, which can cause debts to restrict cash flow.
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