Ipsy is the largest beauty subscription service and discovery platform, founded by YouTube beauty influencer Michelle Phan after her makeup review videos generated millions of views worldwide. While the company was first launched on the beta site Myglam.com in 2011, it quickly pivoted to launch its proprietary Ipsy.com website in 2012. Ipsy's main product offering that hopped on the subscription box trend is the "Glam Bag" of personalized beauty products. However, the Ipsy empire doesn't stop there. On top of the Ipsy bag, it is growing as a content platform, with video tutorials on makeup selection and application as well as reviews uploaded by consumers to reach those looking for the best beauty advice and tips.

To date, Ipsy boasts a community of 25 million people, including more than 160 million product reviews, and more than half a billion monthly content views. In 2019, the company boasted over $500 million in revenue.

Key Takeaways

  • Founded by YouTube makeup influencer Michelle Phan, Ipsy is the largest beauty subscription box and discovery platform boasting more than 3 million subscribers.
  • For between $12 and $50 a month, subscribers receive a Glam Bag of beauty products customized to their profile and personal preferences.
  • Ipsy's platform also includes video tutorials of makeup application, customer reviews, and featured celebrity content.

How Ipsy Works

Ipsy is a Glam Bag subscription-based program, with three subscription tiers. For a subscription fee of $12 per month or $132 annually, each subscriber receives a Glam Bag, a collectible makeup bag filled with four to five deluxe-sized samples or full-sized beauty products with free shipping. Each bag is compiled to offer subscribers a complete makeup look and includes at least one product for skin, eyes, and lips.

In 2019, Ipsy expanded its portfolio to include the Glam Bag Plus and Glam Bag Ultimate subscriptions. The Glam Bag Plus includes five full-sized products at $25 a month whereas the Glam Bag Ultimate for beauty fanatics costs $50 a month to receive 12 beauty products.

$12/month

The cost of an Ipsy subscription, or $132 annually to receive a "Glam Bag" of four to five deluxe-sized samples or full-sized beauty products with free shipping.

All of the products sent to users are issued based on a complete survey taken by subscribers during the sign-up process. The experience is personalized through the quiz, which determines the subscriber’s eye color, hair color, skin color, favorite brands, and preference for items. Questions are also asked to garner information about users' previous makeup experiences, looks they have tried or like, and products they may be interested in but have not had a chance to try or cannot afford to try. Michelle Phan is most excited about the fact that Ipsy provides subscribers with access to brands they love and cannot afford or brands they have never tried. Ipsy began as an “invite-only” site but has grown to become a regularly featured ad on many sites, including YouTube and Facebook.

Michelle Phan and other stylists working for Ipsy regularly release makeup tutorial videos, which, combined with the Glam Bags, are designed to give the consumer a complete experience. Subscribers have access to these videos through Ipsy. Videos can also be accessed through Phan’s YouTube channel and the respective YouTube channels of other stylists. Top stylists offering videos on YouTube include Promise Phan, Bethany Mota, Andrea Brooks, and Jessica Harlow. All stylists exclusively use products delivered in Glam Bags to demonstrate how looks are created with Ipsy products.

Ipsy's Growth

Michelle Phan released the Glam Bag subscription program in 2011 with a video on her YouTube channel. The website amassed more than 500,000 users in a short period of time, and the products sold out each month. Users quickly began to share their own videos relating their experiences with Glam Bag products. Within the first few months, the site began to experience problems because it was unable to handle the massive amounts of data associated with serving nearly 1 million customers. Phan saw an obvious need to expand to provide current and potential subscribers with the experience they wanted.

In September 2012, Phan and co-founders Jennifer Goldfarb, Marcelo Camberos, and Richard Frias launched Ipsy.com. The site name was generated from the Latin root "ipse," meaning self. The idea behind the company was to encourage the exploration, growth, and beauty of each individual subscribing to the site. The venture paid off: Ipsy reached profitability within six months. While Phan remains the face of the company, Camberos serves as Ipsy’s chief executive officer (CEO), and Goldfarb serves as president.

Michelle Phan debuted on YouTube in 2007 as a "makeup guru" and has created hundreds of videos and amassed more than 600 million views. Phan’s channel has almost 9 million subscribers, and she once served as a spokeswoman for Lancôme. Phan has also been featured in Vanity Fair, Forbes, Vogue, and Seventeen magazine among others.

In May 2015, Ipsy launched the Ipsy Open Studios to help teach and develop up-and-coming beauty creators and makeup artists. These studios allow future creators to use studio space for free to practice and develop their skills. The Ipsy Open Studios forum also allows creators access to personal coaching with Phan and to conferences and networking events. Many creators are developing career-changing connections and tips and tricks that will propel their futures. This studio program is also quickly becoming a marketing tool for Ipsy and has led to a steady increase in subscriptions.

The Future of Ipsy

As of February 2020, Ipsy had over 3 million subscribers. Ipsy faces its most significant competition from Birchbox, a company that offers a similar service for comparative prices. However, Phan argues that Birchbox is less personalized and less devoted to building relationships with subscribers. Birchbox has been successful since its launch in mid-2010. In total, Birchbox raised $86.9 million in venture capital funding (compared to Ipsy's $103.2 million) but was acquired by Viking Global Investors in May of 2018 for $15 million.

In August 2018, Bloomberg reported rumors of a potential IPO for Ipsy to go public. Bloomberg reports that the company could fetch up to $2 billion in an acquisition.