Hot Smart Rich with Maggie Sellers Reum - Maggie Sellers On $50M Lawsuits, Fake Birkins, And The Future Of Beauty (Ft. Katie Sellers)

Episode Date: April 23, 2025

In this episode of Hot Smart Rich, Maggie Sellers and Katie Sellers break down the five biggest stories shaping beauty, retail, and the startup lifestyle—$50M lawsuits, fake Birkins, rebrand flops, and the future of K-beauty. We get into: The truth about K-beauty medical tourism (and what went wrong for one woman who lost her vision) Why Olive Young might eat Sephora’s lunch—and what beauty from the inside out really looks like How Boy Smells lost the plot with their rebrand (and their core customer) How TikTok creators in China are exposing luxury markups—and what that means for the future of fashion houses and consumer trust What the Revolve lawsuit reveals about influencer marketing, taxes, and the fine print no one talks about 📌 Like what you hear? Rate + review the pod to support women who are redefining what it means to build power—through culture, capital, and consumer.  Brands, Products & Things Mentioned in This Episode Olive Young Sephora Revolve Boy Smells 4AM Skin Phlur by Chriselle Lim Freja New York Polène DHGate Amore Vintage Tokyo CONNECT WITH MAGGIE: INSTAGRAM: ⁠⁠⁠@maggiesellers ⁠⁠⁠ TIKTOK: ⁠⁠⁠@maggiesellers_ ⁠⁠⁠ LINKEDIN: ⁠⁠⁠Maggie Sellers ⁠⁠⁠ CONNECT WITH KATIE: INSTAGRAM: ⁠⁠⁠⁠@katiesellers_ ⁠⁠⁠⁠ LINKEDIN: ⁠⁠⁠⁠Katie Sellers⁠⁠ ⁠ READ THE NEWSLETTER: ⁠⁠⁠HSR ICYMI ⁠⁠⁠ SHOP HSR: ⁠⁠⁠HSR MERCH⁠⁠⁠ ⁠⁠⁠SHOP MY⁠⁠⁠ ⁠⁠⁠AMAZON⁠⁠⁠ This episode is produced by HSR Media. Learn more about your ad choices. Visit megaphone.fm/adchoices

In communities across Canada, hourly Amazon employees can grow their skills and their paycheck by enrolling in free skills training programs for in-demand fields. Learn more at aboutamazon.ca. In case you missed it, you're allowed to be hot, smart, and rich. So let's get into it. Angels, welcome back to another episode of Hot Smart Rich, the podcast. Today we are trying something new again. I feel like every single episode I've said that. But I think that, like I've said before, is the best thing about starting something new is you get to like test stuff around. And I am here with Katie because we have gotten a lot of requests to go more in depth and faster to market with our favorite consumer news stories and what is going on in consumer news, pop culture, and the mergence of brand, the crater economy and venture capital, which is really the intersection that I have loved to sit in for the last few years. So we are recording this on Monday, and this episode will be released on a Wednesday.

And you'll notice that I have a new background. And this is the first time I am recording in my new house, which is amazing. And then Katie, who is joining me is also recording at her house in Toronto. So we makeshifted these studios. I wish you guys could see a photo. Maybe we'll put it up on our Instagram stories. on the Hot Smart Rich account when this episode comes out just so you can see like the beginning of something because it is so not professional and it is so not put together. And I think that's

like the beautiful thing about this is it's truly like from the ground up. And I'll be honest, like the podcast has gone super well since we started that we did get a lot of interest from different podcast networks, which has been amazing. We also like we've told you guys, have gotten signed the Spotify creator program. Just so happens that as soon as we got signed, they decided to do construction on Spotify Studios in downtown LA. So they've been amazing at just like helping with figuring out different studio space across the city.

But really for us, it was like this is supposed to feel like a really amazing entry and super digestible and can be for anybody no matter where they are in their career. So like why wouldn't we want to just do it in the comfort of our own home so it's more inviting. So here we are. I'm very excited. Katie, how are you feeling? I'm feeling good. I'm trying to, you know, like, keep my HSR energy up and my tone of voice up. Can I tell you? Like, I literally started crying probably 20 minutes before we filmed this. I kind of figured. Currently, like, listen, I made this in my KMH ambassadorship video, which is like,

like these are all amazing things that are happening all at the same time. And it is so overwhelming. And like it's hard because I want to feel like, I mean, I am so grateful for all these opportunities and all the things that are happening. But as somebody who gets overwhelmed, as somebody with anxiety, and I would argue somebody that probably doesn't have those things would still with all of these major life transitions feel like overwhelmed. Totally.

Totally. And so I was, right now, my makeshift office is where the baby. room will be and there's still like there's no baby right now you said yeah there's no Maggie sellers is pregnant no um eventually but I have we bought the house furnished and so in the baby room there's still like not a crib but like a three year old bed there's a bunch of dressers it's like a babyed room and I put my makeshift desk in there I have been trying to make it work and then when I was like trying to film this morning, I was just like, oh my God, this is not going to work. And so I just pivoted and went to one of the other rooms. But like I said, grateful for

everything that's happening and for this amazing house. But it's still in that phase of like everything just feels chaotic. Like a lot to do. Yeah. Today, like I said, we're going to be talking about kind of like our five major things that I was noticing about just major consumer behavior trends. But like you guys have been loving about the podcast so far, we talk a lot about money. We talk a lot about consumption. So I wanted to ask you, Katie, like I ask every guest, what is your latest consumption habit? So your largest last purchase and then just your last purchase.

Yeah, well, I was thinking about this because my last one was Botox. And I actually had someone say to me over the weekend that I was talking to that they were like, oh, you're part of the Botox crew now. And I was like, lull. We did buy a new iPhone recently. Like the iPhones, like they know when you need a new one because the storage is full and then the phone just like crops out. That was my biggest purchase.

And then my most recent purchase was, uh, I, the weather in Toronto was like wild. And I had to randomly buy like sun hats for Warren for daycare. This purchase is the biggest hostess gift hack. So whenever you are hosting and somebody brings flowers, obviously it's lovely. Yeah. But it's also an inconvenience. Like I hate to say it. But you're just like, wait, I have to now go find a vase that fits this, cut the stems, put it in.

Like, I'm hosting. people right now. So I always love when I'm prepared to go over to someone's house. And we went over to my best friend Terry's house last night with her husband and her baby. By the way, she cooked Eastern dinner by herself. She has a baby. Her nanny was off. So I was like, I know she's going to be super busy. And so I got this beautiful bouquet of flowers delivered. I ordered them on Thursday. They came literally an hour before we got there. They were already on the table in a vase. And I was like, oh my God. And she was so appreciative because she was like, you all. You are offered something to the experience, but without having to inconvenience me.

Yeah. And that is my biggest hack is like to make things easier for people. Um, so that was my last purchase. That was last night and it was remote, I guess. Yeah. And then my last biggest purchase obviously was this K beauty experience that I did when I was in Korea and that was $1,800. Yeah.

And that was obviously a large chunk of money, but compared to what it would be in the states, it's like over probably 15 or 20 grand worth of treatments done for $1800. I was going to say it's like 20% of the cost. Like it's a fraction because I was even thinking about when I went to the meds spa for my stuff and I was like, this is, I should be going to Korea. They have a lot to say about K Beauty and that was the big topic of our newsletter. And I do not think that this is a trend at all. I think this is a category that is going to become mainstream. But it's really interesting because I posted this video about going to the Korean med spas and the amazing experience that I had. And at the same time, a woman, this influencer, or not, she's not even influencer.

She's actually a ceramic from San Francisco, a ceramicist from San Francisco. Her name is Esther. She actually lost the vision in her left eye after a juvalogue treatment when she was in South Korea. The videos that we posted were on the same day. Oh, wow. And I think, like, what? One, I just want to say to her, like, I am so sorry that this happened to you.

That is traumatic. And I watched the full video. She, unfortunately, while she was getting the treatment done, she actually said to the doctors, she said, I can't see out of my left eye. Yeah. From watching her video, there is something called a two-hour golden hour treatment, which if something happens like this, you have a very short window after it to, hopefully find a reverse or some sort of thing that you can do to fix what's happened to you.

And the doctors just reassured her that everything was fine. Yeah. And so obviously, like, I went to a Korean med spa and had the complete opposite experience. Yeah. And my experience felt extremely different than that. I feel like my vision had gone. I would not be waiting and not going to the hospital. I'm not putting any blame on her by any means.

I'm actually putting blame on the provider that did this, where, like, that's on them that they didn't take extraordinary precautions after a patient has alerted to them that something is seriously wrong. Yeah. And that, I think, can happen no matter where you are in the world, right? Totally. And I think that's, it was a really good reminder to me that it's like, I'm not not going to go back to Korea to do medical treatments because I didn't have that experience.

Yeah. But I think it was a good reminder. and I am a little bit of a hypochondri act where it's like always having a plan B, like thought through plan of like, what are you going to do? You don't think it's going to happen to you. And then it does happen to somebody like you or somebody that you know. So it was a really interesting parallel. And I started seeing a bunch of comments on my video of like, oh my God, I'm seeing at the same time I'm seeing a girl lose her vision. And I think it is a good reminder where it's like it can happen anywhere.

And it really is around like making sure that. you are the shepherd of your body. And if you feel like something is wrong, like it is wrong. Really interesting thing about my experience. And I mentioned this a little bit in my TikTok video was the standard of beauty is so different in Asia than it is in the U.S. So in the U.S., we have glamorized this look where it's like pointy features in a really strict jaw line and like a slope nose.

And it was really interesting because in Korea and in Asia and cultures, actually 80% of the foreign floor was Chinese visitors. They all want the complete opposite look. They want round features, a round face, not a defined jaw. Like, at least that's what was told to me. And so it was very interesting going to another country to get treatments done where like I have a certain standard of beauty that I'm looking for. They think of something completely different from a standard of beauty.

And so it was very interesting. It actually made me appreciate what I look like more authentically than like what I was trying to be other than like myself necessarily. Yeah. I also experienced that like when I was traveling to India for work, when I was working with EY, different standards of beauty in different places is really eye opening. It's really interesting and I think that's what's the coolest thing about traveling so much is you learn so much.

So even like the business way that people do business is so much more formal in Korea. We didn't do as much business in Japan or at least I didn't. But when I was in Korea, we did meet with a lot of founders, a lot of factories and the largest retailer in Korea. And it was so interesting. Like, no matter your title or your role, every single person when they start the meeting, like presents you their business card. It's like a very formal experience where it's like almost this huge presentation for them of like their pride and joy is in this card. And I mean, obviously, I don't carry around business cards. So like, I already felt like, oh no, like I don't have something to present back. So that was like one major learning.

You feel weird in the meeting being like, oh, God, I don't have something to give them? No. I brought them all like HSR lip gloss. So I did have something because I knew I was doing these meetings. So I mean, then that was like a topic of conversation to launch to. But even like the words hot, smart rich were definitely more polarizing over there than it was here. And so explaining to the executives behind Olive Young what being a hot smart rich founder is, like their faces at first were like pure shock. And so I think that was a really interesting tidbit that I also learned.

So the culture between Americans and Koreans is night and day, even down to the experience that you'll have when you're at Sephora or Olive Young. So for those of you who don't know what Olive Young is, it is the largest beauty retailer in Korea. They have almost 1,400 stores in an island that's like tiny compared to the U.S. Just to put into perspective, Sephora has about that many stores. I think they have like 1,700. It's the entire U.S.

There is basically an Olive Young on every single corner. And I said this to my community. Like, if you are not paying attention to Olive Young and you are a beauty brand, you are in trouble. Because they are about to launch in L.A. this year. And they have goals to open two more stores very quickly. If it goes as well as it does in Korea, like they will quickly grow to, I think, become one of the largest beauty retailers here.

And I think, like I've said, said always, timing is everything. And the time is ripe for women to want something like Olive Young versus Sephora. And so let me break that down for you. When you walk into Olive Young, it is a love letter to women. It is telling women beauty is from the inside out. Beauty is holistic. Beauty is what you put on your body. It's what you put in your body. It's how you carry yourself. It's how you nourish yourself. It's how you celebrate yourself. And I think American women wouldn't have been ready for that yet because like Western medicine, we have always treated symptoms, not the root cause.

Where in Eastern medicine, it is always about the root. And for someone that like me has struggled with acne for years, when I was doing treatments and creams and lotions and potions, nothing worked. And I was always that patient to my dermatologist that was like, I don't want to go in spirulactin. I went on acutane once and guess what? It didn't work because it was treating the symptoms, not the problem. And it wasn't until I actually started seeing an Eastern medicine practitioner, did a whole supplement protocol, lowered my cortisol, started trying to get better sleep, eating before having coffee. Little things like that did my skin go from being a disaster

to being like something that people ask me about all the time. And it's very interesting because most VMS or supplements have failed at Sephora. And it's interesting to think about why, because when you walk into all of young, yes, the first floor is like mostly the skincare and the beauty that like works really well. But the entire upstairs floor at the store that I went to was like an entire massive section for food and beverage, an entire massive section for supplements, laundry, toothbrushes, toothpaste, sleep aids, like bras, thongs, um, like anything. that revolves around taking care of yourself, that was what was stopped there. It just made me think about all of the brands that have been a Sephora exclusives if that

doesn't allow them to be in All of Young. Because not that I'm saying that right away, all of Young will take over Sephora, but I think that over time, they will have problems because people are, even with the tariffs right now, people are buying K- Beauty by like the boatload because they're like, oh my God, I would need to get my K beauty supplements and treatments and products before like the tariffs come in, there is demand for it here. So if the demand is here and they're just like so ahead of the game. So we met with the two executives behind the U.S. expansion.

And it's really cool because now I'm putting a list together of brands that they should be considering for emerging brands and across every single category, which is so fucking cool to be able to do. They gave us the executive summary presentation. it is a privately held company, but we were able to understand basically the entire business. And even just the trends that they've identified before they come to market. So like in 2020, it was like vegan was everything, like vegan skin care, 2020. It was like women health.

So 2022 is when all of Young started introducing all of these other categories into the business. And then their kind of vision for 2025, 2025, 2026 is like beauty from the inside. out is literally their focus. Just so on trend with everything that I've talked about over the last little while. They're late years ahead of, oh, it's this love letter to women and really it's the holistic view. And as a consumer, I would love to be able to go to a one-stop shop where I can grab underwear, laundry detergent and like a cool, interesting face cream.

Okay, well, that was actually going to be one of my questions to you because when I was talking to Courtney about it, he was like, I actually don't know if like women want that in the States, and this goes back to like, there is one formula for successful businesses throughout history. It is the decoupling and coupling of functions and features into platforms or into standalone things. And you can either be exceptional at one thing and do it incredibly well. And people come to you because they're like, they are exceptional at skin care and makeup. Or it's like you then become the one stop shop for people that are like time port. and you're looking for something where maybe it's not exceptional at every single thing,

but they have almost everything that you're looking for. So my question to you was actually going to be, do you think that the American consumer, the woman consumer, wants that approach now? Or are they still looking for like the expert that just has one of everything that's the best? Well, I mean, I'm in a different phase of life of being a mom. And so I'm even thinking about my online purchasing habits. I can buy everything from one place from one online order, which is sometimes why the default is Amazon. It's like, because you can get everything. Then I'm only tracking one order. It shows up all at the

same time. And I don't want to be buying at a million different places. Like I find that really annoying. Yeah, I was going to say, like, I think that they're, if they were going into like medical treatments or like things like that, I would just start to distrust the experience. It's like, what are you the expert in. But for me, because I know that their promise is like, I mean, I came up with this thing, like love littered women. I actually don't know what their mission statement is. I feel like they've stayed somewhat with like a mission in mind and they've gone wide enough without going too wide. Yeah. But I have heard rumblings that and we obviously have a portfolio company that we haven't even announced yet that just got a PO with ALTA as a supplement VMS company.

but it's interesting because I feel like Sephora, I mean, last week in the newsletter, I put in about 4 a.m. skin and the rebrand that Sephora wanted them to do. And I actually loved the transparency that Jay talked about, although I didn't necessarily agree with the guidelines that they wanted 4 a.m. skin to go down. But I hope that if 4 a.m. skin is watching this,

they are just like looking at what happened with Boy Smells because that was something where from, this is all speculative. Like I have not talked to boys smells. I don't have a relationship with Sephora directly. But from what I have researched online, this was a push of a rebrand that Sephora wanted them to do to be able to go into store. And it has backlashed.

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Really? Love that. So I like went kind of deep into this this morning because I'm three hours ahead of you. So I was like, oh, I want to look into this. Because transparently, like I hadn't even really heard of the brand voice smells because obviously I'm not. I don't think I'm the demographic, obviously, right? Because it was started as an LGBTQ sort of like male driven brand. That's what my perception was from what I looked at online.

I could see a very distinct change and I totally agree with the backlash. of like it went from being this really authentic, interesting looking brand to just the cookie cutter brand that is exactly what Sephora wants on their shelf with no real personality. What do you think about the Boy Smells rebrand or Rebland? Overall, so disappointing. So I loved Boy Smells because of this intersection of masculinity meets femininity, even down to like the colors that they picked black and pink, which traditionally I don't really like going together, but it just worked for them. I also as a millennial loved the like simplicity branding

meets these over the top accentuated features. So like the top of their perfume and fragrance brothels were so like avant-garde and just like decorative and just over the top that I found it matched really well with this and it balanced out the simplicity of the branding. Um, And so obviously now they have totally, one, reformulated their products, which is I think the bigger concern for people. I don't know if you've read the copy of the website, but like they went from taking these like beautifully written, almost like serenated poems into like this clickbaity, gen Z not relatable, like saying like I want to smell like your situation ship. Like, sir, I do not want to smell like my situation ship. I want to smell like I'm in love or I'm empowered by being single or whatever it is. And so that the not only like the re-formulating, but like the way that they're now talking to the customer, they've lowered their prices.

And the actual packaging looks like every other brand out there. Like look at the similarities between rare beauties blushes with that like circular top. And then now like the boy smells fragrance bottle. And it's just like lost its sense of identity. an individuality. I feel for you, Boy Snell's leadership team, because I too fell victim to wanting to be like Gen Zified. And like when Gen Z brands were everything like Starface and like plus and all these ones that were going into Target, I was like, oh, maybe that's what I should also turn our branding into. It was like this loud, exciting pop of color. And at the end of the day, like that was a

disservice to my millennial self because I love glossier pink and millennial pink. And I love like this balance of elegance meets like boldness. And I feel like that's what Boy Smells already had. But the reason I really feel for Boy Smells is because you can tell that they are trying to find a new consumer. And that signals one thing to me, which is like the brand wasn't doing that well. But to see the reformulations, the new price point, the new retail distribution, and the new copy on their website, it's like every single thing about this brand has changed. And I think it's actually going to be,

it's going to be interesting to see what happens because unless they're able to identify a completely new consumer base at Sephora and grow that, like they will have lost. And from what I've seen, they have lost their original consumer base because people like don't feel it's original anymore. They feel like they've turned their back

on their original brand identity. And now they're like, okay, you've sold your soul to be in Sephora. and now we are no longer going to support you. That is honestly, Maggie, exactly what I thought when I was reading through everything. I was like, to me, as an executive in business, this is just a business that was not performing well. And that is the unfortunate reality about a brand that has such big authenticity. It's really cool.

It has, you know, a niche with a consumer. Sometimes that just doesn't translate to the engaged mass audience that you need to grow and scale. a profitable business. But then like, why does it, like, why does Sephora even place a PO if it's not even doing well? The other things I uncovered in my investigative journalism, there was something else in the Beauty Independent article that was a very similar story, which is the brand plur. And I think that's how you pronounce it. But the Chris, like Christine Lim's brand?

The Cressel Lim brand, plur, that's the, started as the fragrance brand. I thought she founded that brand. she didn't. She bought that brand from someone else and scaled it into the brand that it is today with Sephora. And if you go back and look at the packaging of Plur before she bought it and changed it into the like millenniafied fragrance brand that it is today, there's a lot of same anecdotes with people being like, oh, the formulations aren't as good and blah, blah, blah, whatever it is. And I just think it's really interesting that there's now this other perfume fragrance brand that's, I think Sephora is trying to do, this goes back to why you're saying, why is

Sephora doing it? I think it's because they were able to do something successful with Plur and Criselle Lim and they're trying to put that exact same formula into boy smells. And obviously the reaction has been very poor. I think that this goes back to why people buy brands. And if I was starting a new brand today, there's really two things that you think about. And it's like people buy brands for functional needs and for remote. needs. And I think that boy smiles had an extremely like tied emotional relationship to their consumer and they've lost that. And so like now that they're looking for like what are the other kind of like Gen Z brands that I can buy from that fit that emotional need where I feel like

included and secure. There's this like signal to people that you're wearing a certain brand or you're a part of a certain community. And so it's been really interesting to watch everything go on between like China and luxury brand houses. When I was in South Korea, there's this amazing part of town that's like all these fakes, right? And it's like almost you could never tell. I had just became an Hermes Kelly owner. And it was very interesting because whenever I've gone into Hermes doors worldwide, they just like at the front door, like we don't have any appointments for you today or we have no bags.

And every time I went in Japan, they'd be like, oh yeah, we have bags. Come back. And I'm like, oh my God, I'm going to get my Kelly. Thank God. And they offer me like a bag that it's like I would just never wear it. so I always just like left. But I was like, okay, I feel the luck starting to happen. Like, I'm getting offered bags at least.

But then we go and we find this vintage, this iconic vintage store called Amore. It's in this part of Japan. That's where like all the vintage stores are. So the bag that I got was from 1996. It is stunning. And so when we went to South Korea and somebody was like, do you want to go to the fakes part of town? I was like, no.

Because to my email, I think there are so many amazing hand. bags now that serve a functional need and an emotional need, by the way, and aren't trying to be something that they're not. And I look at every, like, every single TikTok video, the live that I'm being fed is like Chinese manufacturers on DH, DHGate selling bags that are like an Hermes, Kelly, but like without any branding. And to me, it's like, why do I need to walk around with that? If there's so many other amazing bags that are like in the three or four, or $400 range that I can wear and proudly be a part of that community. So it's just interesting that like obviously the way that I think is completely different than

a lot of people because DHAGate is the number two app in the app store as of last week. So people are buying bags off of there. And I do think that this will hurt the luxury brand houses. I really do. Like we just saw that LVMH has lost, well last week for a period of time like Hermes finally passed LVMH in terms of market share. So I do think that with the economic climate and like, which is with everything going on, that we will see this effect the luxury brand houses.

But on a personal side, I don't feel the need to have 60 handbags that are fake designer. I would rather have these like I just got that free a New York bag. I love it. And I think it's like $260 retail price. And I'm proud. to walk around with that bag being like, this is the Freya from New York.

Like, it's an it bag right now. And I don't think that I would want to change to have another white Hermes bag if it's not actually part of the Hermes community, if that makes sense. Totally. Like, as someone who was a teenager in war bags like that, like it doesn't make you feel good.

You always know that it's fake. And why are you trying to copy something without giving the credit to the actual house who's come up with the brand, the product? a history behind it. So I feel the same as you. Like I just, I would never go on D-H-Gate now and buy a fake bag and carry around a fake Birken or a Kelly or a Louis Vuitton bag for that matter. Like I just don't see the purpose. There, like I said, if there were no options in that like

200 to 400 range of premium brands that like built a community and had beautiful stores, like there's a store, I think it's called like Pollen, P-O-L-E-N, and they, have an experience in store where you feel like a luxury customer, but you're buying a premium brand. You're not buying a basic brand. Like that to me is an experience where you're spending the same amount of money that you are on DHGate, yet like you're trading in an actual experience where you feel deserving as a customer to just feel like you're keeping up with who. Like that's where I don't get it. And like for me, it just feels like there's so much that's going to come from this kind of awakening of China versus the luxury houses. But to your point,

like, listen to the four-hour episode on Acquired podcast about the story of Hermes. And like, as somebody who does horseback ride and like loves culture and loves like things that have these stories to them, like I love and respect the luxury fashion houses. As much as I respect the premium brands that have come up in the last few years and their stories that are going to be told. And it's why my closet is mixed between the two. Yeah. And I'm so big on that. It's like, listen, I'm like almost 33 years old.

And it's like the first time I'm in a place where I'm like able to afford a Hermes bag. And it's like I have one from 1996. I mean, it's obviously right now really on social, but it'll be interesting to see when it crosses over into like brands getting litigious over the copying and copyright infringement, which I think leads us into our final story about the revolve $50 million lawsuit. Yes. Okay, I have a personal story for this with my experience with Revolve Gifting because I just got an email saying I was like one of the top sellers on Revolve.

You have $2,000 to spend in the store. And it was like, you have to tag it five times in your stories, which I already was really weary of because I don't like accepting product to be obligated to post if I don't even know if I'm going to like the product yet. So that was already a red flag. But I was like, you know what? Let's go check out $2,000 is kind of a lot. So I'm looking at Revolve stuff. I find probably. two things I would have spent my own money on. And then like, because it was from certain collections, there was like seven collections I could choose from. And there was probably like a few things in there that I was like, oh, I probably wouldn't use my own money for this. But like if it's free and I can like

like like like like like it, then maybe I'll take it. So when I'm checking out at the very end, it's like enter in your EIN information and your social security number. And then there was this huge disclaimer that said that, okay, if you're getting gifted product, you have to disclose it to not only the FTC obviously, but then also the IRS. And I'm like, wait, what? So I go to chat GPT and I say, how much am I going to have to pay if I live in California in taxes with $2,000 worth of gifted clothes and revolve? The estimate was $600. So in my head, I'm like, I really, only really, really, really want two of these pieces in this collection, which were independently both $200. So that's $400. So maybe this is my girl math, but I was just like, I don't feel right about,

ordering $2,000 worth of clothes, paying $600 towards taxes, and then really only wanting $400 worth of the clothes that they're allowing me to choose from. Like, this doesn't make sense. Plus, in their now disclosures, it's like you have to guarantee multiple times that you are going to put hashtag ad or hashtag gifted, where it's like, but this, like, I'm not mandated to be posting. It's like, I don't, I never accept gifted product if I'm mandated to post it. because I don't know if I'm going to like it. And I want my audience to trust what I am going to talk to them about. So that I'm not just pushing things down their throat to get free product.

Like that's not the way that my creator brain works. So it was really interesting is when I was talking to Courtney about it, I was like, can you believe this? He's like, yeah, well, Maggie, that's why a lot of celebrities do not accept gift bags from the Oscars. So every year at the Oscars, this last year, there was like $217,000 worth of product. There was even like a liposuction gift card. It just doesn't make any sense.

And a lot of celebrities turn down the Oscar baskets for the same reason. Not for what you'd think. So I did the same thing. I put it into chat GPT. If I am a celebrity getting an Oscar basket, how much money am I paying towards taxes on a $217,000 gift bag? You're paying almost $80,000 worth of taxes on that gift bag of stuff that you probably won't even use nor want. So when I saw this lawsuit, like, good on this plaintiff for seeing an opportunity to make $50 million

because if a man that was a delivery driver at Starbucks won $50 million for a hot drink being spilt on him in his own car. Like, this woman has a good shot at getting $50 million. But I think that her reasoning is a little bit unrealistic. Like she said that she only bought product from these influencers because she didn't know that it was sponsored and she would have bought them from other stores that didn't mark them up like the 20 to 40 percent more than Revolve does, which I haven't seen that big of a price discrepancy regardless, but also like then we should be going after every brand that does.

It's like the Kardashian genera is with alo yoga. They post the same thing. Allo yoga and tag allo yoga. It never says hashtag ad. And so I think what's going to happen is I actually think that they are going to make an example at a revolve. I think that this will set precedent for case law of influencer marketing. To my knowledge, there hasn't been a huge FTC claim or like a huge like case law precedent set by influencer marketing and like the deception of that. So I fundamentally believe that this will become

case law. I completely agree. And like I've actually had experience in business being made an example of working at CoinSquare, which is now WonderFy, and it was like in the whole crypto space. So like I have experience with a federal agency doing exactly this. And they prey on a business that, yes, sure, Revolve has quote unquote unlimited resources to defend themselves. But what's really interesting about what this lawsuit does is that it names three individual influencers. Influencers. And the problem there for these influence, is going to be if they have never signed a contract with Revolve as an affiliated party to

like provide brand marketing services or whatever and they haven't had a lawyer look at it and they don't have an indemnification with Revolve which if you are a creator and you have a good lawyer part of the contract review literally should be looking at a contract to say okay maggie you're working with Revolve if you ever get sued because of your work and being affiliated with Revolve, Revolve has to be the one to pay for your legal fees and defend you. And so if these three influencers don't have an agreement with Revolve, they're going to have to pay for their own legal fees. They're going to have to defend themselves in court. And what the IRS is going to do is they are going to make an example out of these three women. Well, so did you see that in Revolves

public disclosures because they're a publicly traded company? They actually listed this as a potential risk of the business. And to them, it's like, I think they cleared over a billion dollars last year. don't know actually what their full financial breakdown is. But for them, $50 million lawsuit, like, to their point, they kind of foresaw this happening. But to your point about the individual influencers, like, I would think that if those are people that Revolve has worked with for a period of time and are top sellers for them and convert a lot, like they are going to lawyer them up regardless of their indemnification

clause, but we just don't know until we see it. I've seen businesses do some really shady shit. it. And, but I agree. Like, they need to think bigger picture. Like, if they don't defend these influencers, every single influencer is going to be like, well, they're not going to defend me. I'm not going to be posting for them and doing all these things for free anymore. So I think there's a, like, this may seem kind of basic on one side, but there is actually a lot of repercussions for a business that 70% of their sales comes from influencer marketing. Because depending on which way this case goes, like how they react, how they help lawyer.

up their influencers, like what these clauses are, this will just set a precedent over what actually happens for influencer marketing brands moving forward. Yeah, like it will be precedent setting across the board and it'll be interesting to see if there are other brands beyond Revolve who come to the table to actually like either lobby against it or put their own two cents on it because it will completely change the face of influencer marketing, at least in the U.S. Last thing before we wrap up this because I have to go. I just finished Amy Griffin's book. And if you are a woman in business that has pushed yourself and is on or has been on the hustle grind and has dedicated their life to other people and you've always been in service of others, you need to read this book.

She turns her absolute trauma, childhood trauma of abuse into a message for women about being enough and becoming whole with yourself. And I finished the book in three days. I sobbed my way through the entire book. And if there is one book you're going to put on your Sumner reading list, I hope it is Amy Griffin's book, The Tell. It will change your life. So with that, I want to wrap up this segment. Say thank you so much for listening to the episode. Give us all the feedback on this formula. Please, if you have not, rate and review the podcast. It helps so much. And I haven't been asking that much of you guys for that recently. And I've seen the ratings go up, which just makes me genuinely so happy. It's kind of like what my boyfriend told me about getting compliments. Like,

if you ask for them and you're seeking validation, it doesn't feel as good when it happens because you, like, don't really believe that it's naturally there. Whereas like when you see something organically happen and you didn't ask for it, it's like the biggest sense of satisfaction. So you guys have made me feel so good about seeing that go up. So please rate review. And, subscribe. We love you and can't wait to see you guys next week. Mua.