In 2004, Joey Shamah and his partner launched a cosmetics company built on an idea that made almost no sense:

Sell high-quality makeup for just $1.

At the time, high quality beauty products were supposed to be expensive. The biggest brands spent fortunes on celebrity endorsements, glossy ads, and premium shelf space.

And every major retailer told Joey the same thing:

Your idea will never work.

But Joey believed he'd found a wormhole in the beauty business: spend money on the product, not fancy packaging, marketing, or celebrity endorsements. Then, pass those savings on to your customers.

The brand grew slowly, but Joey knew he was onto something when a bizarre rumor spread that Bloomingdale's was buying e.l.f. and raising prices. Within days, the tiny company went from a few hundred orders a week to 18,000 orders a day.

What followed was a journey from a scrappy warehouse operation in New Jersey to one of the most disruptive brands in the beauty business.

You'll learn:

• The surprising economics behind $1 lipstick
• Why retailers initially rejected e.l.f.
• How a single magazine mention launched e.l.f.'s online business
• The retail insight that unlocked national expansion
• How a false rumor generated 18,000 orders a day
• The emotional toll of a $225 million acquisition that collapsed at the eleventh hour

Timestamps:

• 00:10:28 — How to make (decent) makeup for just $1
• 00:18:35 — The dollar stores say no
• 00:24:32 — Glamour comes calling, and e.l.f has 30 days to build a website
• 00:38:27 — The question from a Target buyer that leaves Joey speechless
• 00:39:56 — The H-E-B test that proves everyone wrong
• 00:46:36 — “That’s news to me!” The viral rumor that sends Joey back to China
• 00:59:42 — Scaling to tens of millions in revenue
• 01:07:15 — “It was crushing.” The L’oreal sale that never happened
• 01:12:02 — After e.l.f: Joey stops watching House of Cards and gets back to business

This episode was produced by Carla Esteves with music composed by Ramtin Arablouei.

It was edited by Neva Grant with research by Olivia Rockman. Our audio engineer was Patrick Murray.

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