How I Built This with Guy Raz - Tarte Cosmetics: Maureen Kelly

Episode Date: January 23, 2023

Let’s say you had a passion but thought of it only as a hobby; certainly never the seed of a billion-dollar company. Plus, you are studying for a career in something unrelated to business. That’s Maureen Kelly’s story, CEO of Tarte Cosmetics. She was pursuing a Ph.D. in clinical psychology and already had TWO Master’s degrees when she realized she didn't want that to be her career. What she wanted was to launch a makeup company—despite having no significant start-up money, no experience, and no connections. How she did it is a story of pure moxie. She relentlessly knocked on the doors of chemists, manufacturers, retailers, and the fashion press. She maxed out her credit cards and enlisted the help of friends and family, turning Tarte into a wildly successful brand.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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through Squarespace capital. Go to Squarespace.com slash built for a free trial. And when you're ready to launch, use offer code built to save 10% off your first purchase of a website or domain. Loans issued by Celtic Bank and serviced by Stripe, all loans subject to credit approval. This show is in partnership with Airbnb. This past summer, I took my family to Vienna, and it was incredible. We spent our days wandering the old streets, stopping for coffee and pastries, visiting museums, and just soaking up the history of one of the most beautiful cities in the world. And one of the things that made the trip so special was the home we booked on Airbnb. It had tall windows, beautiful old details, and plenty of space for all of us. And being in that home on Airbnb, right in the middle of Vienna, walking distance from so much of the city,

made it feel less like a visit and more like we were actually living there. Plus, taking a trip is the perfect time to host your space on Airbnb. Your place with all of its personal touches and its amazing location could make someone else's vacation even better. Your home might be worth more than you think. Find out how much at Airbnb.ca.com slash host. I can remember the beauty editor from Vogue came up to me and said, what is this and who are you? Yeah. And I was like, I'm wearing Kelly and this is tart.

And she's like, okay, so you're not a celebrity makeup artist. not an heiress, you're a nobody. I was like, okay, enough with everybody telling me I'm a nobody. Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz, and on the show today, how one woman conquered the cosmetics industry without experience, connections, funding, or even a way to sell her homegrown products, turning her company Tart Cosmetics into a billion-dollar brand. One of the reasons I love stories about cosmetics so much isn't because I have a natural interest in them. To be honest, I don't. But over the years, I've become really interested in business stories about cosmetics for one simple reason.

And the reason is there are so many lessons to be learned about business in cosmetics. How to market, how to sell, how to manufacture, how to bootstrap, how to grow slowly and intentionally. I could go on and on. And today's story is a great example of this thesis. Because even if you've never heard of Tart Cosmetics, this episode is a masterclass in things like getting your foot in the door and how to come up with a product that gets people's attention and, most importantly, had a weather crisis.

For those of you who may or may not know, Tart Cosmetics is among the best-selling makeup brands in the United States. They make everything from concealers and mascaraes, to lipsticks and skin creams. And the company was founded by a woman without any experience or connections in the industry. Maureen Kelly was actually pursuing a career in clinical psychology. In fact, when she founded Tart in 1999, Maureen was still a PhD student at Columbia University. She had already completed most of her coursework.

But it was through studying psychology that Maureen got intrigued by consumer behavior. and that's where she started to think about maybe starting a business. And it was her husband Mark who really encouraged her to go for it. Maureen had always been interested in makeup, and makeup, she soon discovered, was something she could dip her toe into without a lot of startup cash. And the key, at least for Maureen, was coming up with a product so unique

it could get the attention of the influential boutiques and retailers in New York City. But within two years of launching Tart, A life-changing tragedy almost derailed the whole company, which we'll get to. For now, what you need to know about Maureen Kelly is that she grew up in a middle-class home in Rockland County in New York. Her dad was a judge, and her mom, who was an Irish immigrant, was involved in local politics. My mom growing up in Ireland, it definitely shaped who she was, and I think as a result shaped us, especially the girls, because, you know, she wasn't allowed to play any sports or do boy things. like girls and boys have very different roles in Ireland.

And so she said, you know, when she had girls, she would make sure that they could do everything, you know, and that they could be anything they wanted. And so that's kind of what she always, you know, said to my sisters and I, there's three girls and two boys. And she was like, you guys can do anything, you can be anything. And, you know, she was just always talking about girl power, girl power, you know, and I feel like that's such a big thing for me now.

And, you know, I just, I guess I didn't think about the fact that my mom shaped that, you know, because of the fact that she couldn't have that. How would you describe yourself as a student in high school? I would say that I did well in the classes I was interested in and not well in the classes that I was not interested in. I am told that I have ADD. I was never diagnosed as that. I think back in my time that, like, wasn't such a big thing.

So I think that that kind of makes sense, right? with, you know, ADD, you have that hyper focus, right, on stuff that you're interested in. So I feel like I was, like, a classic with that. You went to a state university in New York. I did. And Binghamton, right? And when you got there, what did you think you wanted to do? I didn't know.

I'll be honest. My sister went there first. So my one sister went to Georgetown. My other sister went to Cornell. And then my older sister went to Binghamton. And I visited her and classic met a boy at a party and was like, okay, I'm just going to go. there. And of course, I got there and I was like, hey, it's me. And he was like, who are you? I don't even know who you are. I don't even remember you. And of course, I was crushed. But it was a very good

early lesson. And then, yeah. And then I was up in Binghamton where it was really, really cold for a couple years. But I finished college quick. I actually did college in two and a half years. And so I graduated and my sister was already, older sister was already living in a city going to law school. In New York. I was like, okay, Veronica, I'm not moving home. And I'm moving in with you and I'll just sleep on your futon. And I did so I moved to New York City and crashed on her futon. I got a bartending job and I applied to grad school. This is in the early 90s, I think, right?

92, 93 time period. Yes, yes. I was really interested in psychology. It's something that's like always fascinated me and still does. You know, just, you know, like why people think the way they do and what motivates them. You know, and then consumer psychology obviously is fascinating. So I went for my master's degree and that while I bartended. And while you were working on this degree, you start to have doubts about whether you wanted to pursue it?

I did. You know, I love psychology, but I just wasn't sure, you know, part of our job, you know, or requirements as a graduate student was counseling the undergrads at Columbia. And so I would be sitting, you know, counseling them, listening, you know, doing sessions with them. one-on-one, and I would find myself, you know, drifting off thinking about different things. And, you know, that's the exact wrong thing to be doing when you're sitting with a therapist or a counselor. And I'd be thinking, then I, you know, click myself back in and, you know, give some advice or feedback and, you know, reiterate what they were saying. So they, you know, recognize that I was listening to them. But I was thinking, gosh, I do not want to do this with my

life. I don't want to do this, but I'm really far down this path. So, yeah, like. So maybe this is what I should do. What you have to do. And I think that happens so a lot of people. You get really far down a path, you know, and you just feel like, I'm trapped. And I did feel like that. I felt like that. And I talked to my parents and they were like, Maureen, you're all over the place. You have to just finish this. This is just get your PhD, finish your dissertation. And then you can decide what you want to do. And meanwhile, while you, while you were a grad student in New York, you met the guy who you would eventually marry, and I think in 1998, Mark Ludvickson, who would have a huge impact on your career and your decisions. How did you, how did the two of you meet? I met him in a bar

on the Upper East Side. He was a rugby playing investment banker, and he had just come from like a a rugby game. I think at the New York Athletic Club, and he and his friends just came into the bar and started talking to my friends and I, and we were kind of... He was roughly your age, sort of late 20s? Yes, a couple of years older at the time,

but yes, roughly my age. And he was working in the city, in the city, he was in finance. He was in finance at the World Trade Center. And it was just one of those guys that lights up a room, could talk to CEOs and janitors alike, you know, just made everybody feel

like really special, just a really warm guy. He was six, six, three, two and thirty pounds, a funny, just very kind, just a really, really kind person. And did you guys eventually moving together? We did. We moved in together when I was living with my sister. We had moved out of that studio apartment when she was going to law school and we got like a two-bedroom, five-floor walk-up on the Upper East Side. But there was like some kind of an animal in the wall that died, started smelling really bad. So I was like, okay, peace out. I'm moving across town with Mark. And she was like, what? And she was like, I'm telling mom and dad. I was like, don't you dare. And she told my parents, and they were not happy with me. They weren't happy that you were

moving in with him because you guys were married. As that age, we were married yet. My parents are very traditional. So I was like, I'll just stay in a different, you know, bedroom. Of course, my parents believe that. Yeah. And then we actually wound up moving down to Stuyvesant Town. It's just like really cool rent-controlled development. Yeah, massive, massive building. Yes. Yeah. And so, all right, so you have this boyfriend, Mark, and you are, but for, you know, many years, several years, you were doing this degree.

He was working as an investment banker. And it was clear to you that you guys would eventually get married. It was clear to me, but, you know, I was young, for sure. He was a couple, three years older than me. but he proposed and we got married and yeah so he was really really really supportive of me and he just I just you know he said you always talked about doing something on your own and you've always wanted to start your own company and you've been you know for lack of a better word kind of afraid you know yeah because I think but you didn't know what you didn't know

specifically what I didn't know exactly but like in my heart I really wanted to start a makeup company but I knew that my parents wouldn't think that that was like reputable enough, you know, since I was a little girl, you know, it always like play with my mom's makeup and, you know, she was beautiful. And I would, you know, make my own, like, you know, cheek stain in, like, the bathtub with, like, shaving cream and, like, you know, cough syrup or, like, chalk or whatever had. And I would take, like, lipstick and put it on my sisters and, like, they're Holly Hobby dolls. It was something I always loved, right? And my mom used to, like, you know, make us to do these egg weight masks and homemade candles and face masks and things like that and soaps. My sisters and I had like, you know, acne or a pimple. She would like, you know, mix like turmeric or an aloeira and like, you know. Like home remedies, yeah. So it was just something that I always did and loved. But to her that wasn't like a job, you know.

You were, you liked cosmetics. You liked me. I guess I even read that like you would give friend, like you'd make lip gloss for fun. I did. For like a holiday presents? I did. And I was... How do you make lip glasses?

It's like petroleum jelly and I don't know. What do you... How do you make it? Yeah, we don't actually put petrol on them in any of our lip products because it's a byproduct of... But how would you make it for friends? I would use beeswax back then. Oh, I got you. Yes.

You'd melt beeswax into like a little container with... Yes, into like little jars. Some like, like, I don't know, extracts of different herbs. Exactly. And then I'd put vanilla in. to make it taste good. And my friends would love it, you know, and it was never anything like,

oh, I'm going to start a business doing this, but it was just something that I, you know, that I always love that I always did. And it's funny, my best friend said, you know, that was in my PhD program at Columbia. She said, I remember you, Maureen. She said, I remember having, like, a steel, a eyeshadow palette and you, like,

prying the eyeshadow pan from the paper compact and her saying, like, what are you doing? And me saying, like, I just want to see how this is made. And she was like, wait, we have neuroscience to do. Like, stop it. Like, stop pulling around. You know, so it was just always something I was like really interested in. But you had this interest in makeup and cosmetics because you liked wearing it.

I mean, you liked, I mean, you liked trying different brands out. You like. I did. And I felt like, you know, when I'd go to the makeup counter and I'd get my makeup done in New York, I would look great like so many of us do. But I'd get home. I'd be really frustrated because I'd flip over the box and it would be filled with synthetic like ingredients I could literally not even pronounce because remember this is 1999, right?

I mean, everything was like formulated with like all the bad stuff. And so I was like, I don't know, I just, I wasn't a business person and I'd never created like a business plan in my life or had never done an Excel spreadsheet. But, you know, I had this like vision board that I was like slowly and surely creating of like all of these like cutouts and tearouts from like magazines and things like that. And I just wanted to create this like makeup line of like makeup that was like filled without the bad stuff like the paravans or petrolatum or, um, you know, make it cruelty free because you know my mom grew up in Ireland on a farm. And so we had rabbits and dogs and snakes and all the things. I can imagine like testing

on animals. I wanted it to be mostly vegan and then, you know, filled with like lots of good for you But that was really hard. I mean, there's a difference between having an idea and saying, God, what if we could make a makeup brand that did this and this and cool packaging? Yeah. And I want to do that. There's a difference between saying that and actually the leap to do that is quite large, right? And there's a lot that has to happen. There is.

Including, like, understanding the landscape and understanding how to make makeup and where it gets manufactured and how to make makeup and how to make makeup and where it gets manufactured and how. to finance it. What did you do? How did you first start to learn about the industry? I mean, there are lots of things you had to know before you could actually hit the button. So where did you start? Well, I opened the yellow pages to find suppliers. And I just started making calls, call after call. And guess what? Nobody called me back. Shocker. These are companies that make cosmetics or that actually make the packaging or both? They make the cosmetics. And I just started calling these labs and no one was calling me back because I was a nobody. Remember there was no social media back then, no Facebook, no TikTok, no Instagram. And so then what did I do? I just got in my car and I drove

across the toward Washington Bridge and I started going to the suppliers, the labs and sitting in the waiting room. Yeah. Are there labs in New Jersey or New York? Oh yeah. For sure. Yeah. Florida, New Jersey, New York, you know, Italy, of course, like all over the world, but absolutely there are in New York, New Jersey. And how did you get a foot in the door to any of them? How did you get a meeting to find out? I mean, you were a nobody. I was a nobody, exactly.

So many people told me that. I was a nobody. You had no experience. You had no, you weren't even in business. So how did you even get a, like, what was your ask? Was your ask, hey, I want to find out more about this, or I have an idea to make a, a product line or... Yeah, at that point I just said, I am starting a company, because then I feel like you have to

commit to those people, of course, like behind the scenes in my apartment. I was like, oh my gosh, what am I doing? This is a crazy idea. But with the labs, I would say, you know, to the receptionist, I'm Maureen Kelly, I left a message for your head chemist, you know? I haven't heard back. So, you know, I was in the area at another meeting, and so I figured I would pop by, you know, just kind of... smoking and joking a little bit, I guess. Yeah. And so, yeah, eventually, and most of them were like, most of them were like, they're not available

for a meeting. But, you know, a couple of them came out, and I had meetings with them, and I shared my vision. And what would you ask? I just said, I'm starting a company, a makeup company that is familiar with out paraben, and I wanted to be cruelty-free. I wanted to be infused with, you know, all of these good-for-you-you-me. ingredients and keep out the bad stuff. And you said you wanted to make what, like,

concealer and blush and eye shadow, mascara and lipstick? Exactly. And they laughed at me. They laughed at me because they said, listen, if customers wanted that, the big guys would have done it. Loddor or L'Oreal would have done it. Customers don't care about paraben

being in products because remember, this only, paraben's only came out of things like a handful of years ago. Customers don't care about cruelty-free. This is 1999, right? So, you know, no thanks. But I did find one chemist who thought I was crazy, but he was like, I don't agree with you, but, you know, we kind of take on one charity case like, you know, every year or so. And you know what? I'll do it for you.

And I was like. Where was this chemist based? In New Jersey. Yeah. And this is a manufacturing facility that made cosmetics for a bunch of different brands? They did for big brands, actually. So, you know, they were very established and so they could take a risk. on like a small little thing might like me.

I was like a pet project, you know. All right. So you meet this. And by the way, what's, do you remember the name of this guy, this scientist? Russ. Yes. Okay. And Russ says, yeah, okay, I can, I can probably make something for you.

And was it that going to be expensive to do? Or was it like how much was it going to cost you to have him make just a prototype of a few, you know, products? It wasn't crazy expensive because, you know, He knew that I didn't have a lot of money. That was the other thing. So either you're a celebrity or you're like an heiress making a makeup line. And so he knew I didn't have a ton of money. And so it wasn't crazy expensive.

The other thing is I couldn't afford to have them. Usually now when we have makeup made, they put it in the package. They pack it out. They put it in the box, everything. I wasn't having them do any of that. You had to get it like loose in bags or whatever. and then you would. And by the way, because he was going to do this cheek stand.

The cheek stain. And then pressed eye shadow. And I also did a press blush. So I'm just like thinking logistically. The cheek stand I can, because it's like a gel, so I can see how you would package that. But he was going to give you like. Like literally pans of eyeshadow and pans of blush. And then I got the packaging separately.

and then I had pizza and wine parties because I couldn't afford the lab to, you know, press the tins, the makeup in the actual packaging. And so my friends and my family like basically did it till their fingers, like had blisters on it. And so it wasn't going to be that expensive for you to do that. You could, you basically with your income, you could get this. How much? Mark and I had $20,000 in savings. Right.

And then I put the rest on credit card. Yeah. Do you remember, like, while this lab said, okay, yeah, we'll make this for you. And were you going back and forth to sort of help them fine tune it? Oh, yeah, for sure. Yeah. Absolutely. I was like, okay, this isn't soft enough. It's not silky enough. You know, just I love this color. I don't love that color. So yeah, just giving them lots of feedback is just a non-make-up artist's regular girl. Yeah. I guess when you started the company, there was this person named Troy Surratt or Sarat that you worked with. And I guess Troy was a makeup artist that worked for you on your wedding day. Tell me about Troy's involvement at the beginning because I know Troy left pretty soon after you launched. Yeah, he was a super talented celebrity makeup artist. And he had so many projects as a makeup artist. Like, you know, in the beginning, I really doubted, you know, because I wasn't a makeup artist, I doubt. I doubted myself, as you know, we all do all along. I felt like I needed a makeup artist to help me, you know, create this line. But in the end, you know, we kind of had a different vision of approaches for, like, beauty. Like, I wanted it to cater to everyday women and not high-profile clientele.

So, like, ultimately, it made sense that, you know, he'd become a silent partner after a year or so. And just eventually I bought him out. Right. All right, so you're kind of working on this prototype. And meantime, I mean, it's one thing to, you know, to say, hey, to go to a lab and say, hey, here are the ingredients I want you to use and I want these three things. And then it's another thing to create a brand out of it, right? So let's talk about that side. The name, Tart, was that the name you came up with from the beginning?

I had a different name. It was called Plume. and then I second-guessed myself and I switched to tart, which, you know, tart is like a treat. It's like something yummy. Yeah. And I just felt like I wanted this line to be like a healthy treat for your skin. Yeah. I will say it became a little problematic later on. Well, I'm curious because your mom was from Ireland and in Ireland and the UK, that word means something very different.

Yes. Oh, my goodness. I definitely didn't think it through. What did your mom say when you said it's called tart cosmetics? Well, my mom went on T-A-R-T.com, and you can imagine what was on there. It was not good. She, like, screamed, I think. And then I was told eventually that I would never be able to launch in France and England, specifically because of the name. And luckily, we're a top brand in both now. But, yeah, you know, I just, I didn't think of it that way. Yeah. And you spelled it with an E, T-A-R-T-E, presumably because it was, was that a domain name that you could? get. Yes, exactly. Well, no, actually, I had Tart Cosmetics.com. This is how not savvy I was as a business person back then. T-A-R-T-E dot com was taken by a guy like Scott Tarty, his name was, and many years later he sold it to me, which was very, very kind of him. But I didn't launch the website for actually for years. If you think back then, I feel like dot-com sales, like weren't. It wasn't really a thing. Big thing, yeah. But, you know, you were asking me about, like, my first product and my cheek stain was, you know, was definitely it. And, you know, when I was asking him to put in all of these, like, ingredients, they definitely thought it was crazy. And once that, you got the order from this lab, right? And you've got thousands of pieces of makeup. I keep calling on pieces. I don't know. It's right. But basically. Compacts or pieces. Yeah, exactly.

And then you had to package them. By the way, where did you get the packaging from? So I got the packaging from a packaging company that I found and talked them into doing this amazing lavender fabric packaging. No one in the industry had ever done it. We were the first ever. I look back. I wish I patented that, but I was not business-sabric. Like a, I'm thinking of, for example, like a, I don't know, a lipstick case.

Or mascara. Like, mascara comes in a brush. Yeah. So the tube was fabric outside of it. So like our lights, camera, lashes, mascara, to this day has the fabric around the outside of it. And no one had done that. And was your name brand on there, too? Yes. Printed on there.

Tart was on there. And did you design the logo? It was Century Gothic font from the computer. And it still is the same font to this day. all these years later. Yeah. And that was it. It just said tart on it.

It was super simple. Yeah. And all right. So you are, you've got now probably $50,000, $40, $50,000 worth of product in that apartment that you paid for. Yes. And you can't move. Yeah. I mean, it's boxes everywhere.

I mean, I remember my friend came over. She was pregnant. She had to turn sideways to, like, get to the bathroom. And what did Mark? And Mark was supportive of all this? He was. I mean, he was like, this is so crazy, but, you know, he was such a good guy. He was definitely supportive of it.

And, you know, you can't be half pregnant. We were, I was already like too far down the path. So then I felt like, ooh, I'm legit. I have a company here. But I also realized, okay, I have to be able to sell it somewhere. You're going to sell it. Yes, yes. Yeah, I mean, I mean, this is like today, I guess you could start like a farmer's market or there are tons of boutiques that you could go to online.

What was your game plan? Did you think you would go to like small little independent boutiques and see if they would carry it? No. So, Sephora wasn't even in the United States yet at that point.

But I mean like mom and pop boutiques at some time. Yeah, yeah, for sure. For sure. I was thinking, you know,

I was in New York, so I thought like, I'm going to try and get into Bendels or Barneys or Burghdars, like the three bees in my mind. Yeah. That's it.

Those are pretty, I mean, right? And those are sort of iconic stores. Yes. Bendel, Bergdorf, Goodman,

and Barneys, which isn't, I don't think is there anymore. Besides Bigger Yeah, there was not too many like small boutiques in New York City, you know, at the time. So how were you going to get into those stores? I mean, I have to assume that by and large, the buyers there have relationships with, you know, going way back with other, right? For sure. Yeah. Brands. So I just started calling and leaving messages. And I was so excited in the beginning guy. I said, you know, I have this brand tart. It's amazing. It's amazing. It's high.

performance, natural rules, it's different than anything you've ever tried. And, you know, I left my first message for each of them. And then, you know, they didn't call me back. But that was okay. You know, it's just a message. So then I was like, okay, well, I'll wait. You know, it's like how long is too long, you know, not long enough and how it's looked desperate. And so then I called a couple days later. I left another message, you know, and I would call and then hang up because I would be hoping that I'd be able to catch one of them. But, you know, what you realize is buy these merchandisers and buyers never pick up their phones ever. So that was just never going to happen.

I've learned that since then. So you leave voicemails? Yes, I kept leaving voicemails. And I was getting more and more desperate. Because nobody was calling you back. No, because remember I was a nobody. And you had put down tens of thousands of dollars on your credit card and you had all this product. And I was going to go out of business before I started.

Wow. And full panic. Full panic is now kicked in. And I called and left a message for the Bendels buyer saying, this is my final message. You know, I just had to leave you one more because I grew up shopping in Bendels with my mom, which is completely not true. And I kind of felt bad leaving this white lie. You know, there's a Catholic guilt. But I just wanted to leave you one last message because it was my favorite store shopping growing up with my mom.

We're about to sign tomorrow with Berkdorf-Gudman. You basically made it up. I made it up. Yes. I made it up. When we come back in just a moment, how Maureen's relentless determination, plus that little white lie, paid off. Stay with us. I'm Guy Raz, and you're listening to How I Built This. Hey, welcome back to How I Built This. I'm Guy Raz. So it's the start of the new millennium, and Maureen is grinding away. Cold calling, luxury retailers, running a...

business from home and desperately pitching anyone in the industry about her makeup. But then, that little white lie wrapped in Catholic guilt, pays off. The buyer at Bendels calls back. She said, I'll give you 15 minutes on, you know, like next week, come in and show me your stuff. And so I panicked. Like that week or next week? Yeah, exactly.

And so I went in. I showed her my product because I knew if I could just get it in front. of her, she would see that it was different. I had all of this special fabric packaging and I had my cheek stain, right guy. But how did you prepare for that? I mean, that's high stakes there, right? Because Bendels was like on Fifth Avenue, I'm pretty sure. And it was like so luxurious and influential. And like you had to make that work. Aren't you nervous? I was really nervous. I was super, super nervous. I went in. I met her. I showed her the products. And she said, I love it.

I think it's really different. Wow. But we have a press breakfast next week and all the editors are coming. I'll give you a tiny, like, booth in the corner. If the editors respond to it, I'll give you a counter. But if they don't, then sorry, no. I was like, oh, my gosh. Wow.

So basically she was saying that the press is coming next week to see a bunch of new products that they were considering. Right. And she would allow you to present there. and if they liked your stuff or they, you know, she would put you in the store. Yeah, she would allow me to have a little corner booth basically at this breakfast. Did she ask you any questions like, yeah, where are you selling and where's just stuff available? No, she didn't. You just purely looked at your, she just assumed that you had this new brand and she didn't ask you anything else.

So what's your background? No. Have you worked for Revlon or Lesteylodder? No, no. And so my fate hung in the balance with this press breakfast. So I was so, this is where I was really nervous because I knew this was it. And these were journalists from where? Like Cosmo and Alor.

Alor. All of the big guys. And they were everything back then, right? They made you or broke you. And so I went out. I went to Ann Taylor and I got myself a suit, which, let's be honest, I was getting a suit for this was the complete wrong thing. But I didn't know. No.

I took the tags in the back because I knew I was going to have to return it. Because it was expensive. Yeah. And Taylor really wasn't, not to disparage Ann Taylor, but not really the look of tart cosmetics. Oh, no, no. And a suit? What was I thinking? A skirt suit?

Yeah. I mean, I was so, not cool at all. And so I was there at my counter and all of these beauty editors were fabulous. They all had champagne in their hands, gorgeous, walking around with their champagne, looking at the different products. And I can remember the beauty editor from Vogue, Sarah Brown, came up. to me and said, what is this and who are you? And I was like, I'm wearing Kelly and this is tart. And she's like, okay, so you're not a celebrity makeup artist and you're not an eras. You're a nobody. I was like, okay, enough with everybody telling me of mom of nobody. Of course, I didn't

say that to her. But I was like, great, you're right. But this is amazing and it's so different and here's why. And she's like, okay, well, I'm going to shoot it. Come to my office in two days. And I was like, oh my God, oh my God, oh my God. You know, trying to play it cool. And then, you know, Five minutes later, the beauty editor from Elle magazine came up and was like, what is this and who are you? I love it. It's really different. She picked up the cheek stain. Tell me about it.

And she's like, I want to shoot it next week. I want it in my next issue. Can I ask you about the cheeks stain? So I'm, forgive me because I don't wear makeup. Of course, of course. Usually. I have in the past. I was a TV reporter 20 years ago.

So I got to learn how to use makeup. But very rarely wear it these days unless you have to get you some shape, too. All right. Okay. I'm in. I could use it. Anyway, I'm trying to understand that this thing about cheek stain. It was something that you put out there and they were like, wow, what is this thing called cheek?

Because I would see cheek stain. Darring. I don't want to, I would think weird. I don't want to stain my cheeks. Exactly. And that. I don't want to put stain on my cheek. It's just weird.

Totally. And it looked like that because it looked like a jar, like this jar of like the cranberry sauce, like that gross like you get to bring the can. It's dark. Yeah. But it comes out really pretty and natural and it just gives you this like beautiful flush. Like a like a reddish light sort of like a Renoir painting. Exactly. Exactly like that guy. But it was, I mean, obviously this is a product that's become massively successful for you today, which we're going to get to later. But this was basically, I guess you could kind of describe it.

Again, I'm describing this for people who are not familiar with makeup, so forgive me, Maureen, because I'm not a complete idiot. But it's sort of like a giant lipstick tube for your cheeks. That's exactly right. And it's gel. And it's gel. Okay. And so you just like dab it on, and then you blend it with your fingers and you go, which is really cool. So these editors were kind of looking at that and they were looking at the fabric packaging, which they also photographed. And I had double-ended eyeliners. And they said, like, wow, like, this is all brand new and really different. And I think that's the thing that saved me because I hadn't worked at Lodder. I hadn't worked at L'Oreal or L'Ancombe. I didn't go into this feeling like, well, this sells and that sells.

So I have to do that, right? I didn't launch with a mascara. And a mascara is typically a brand's number one selling product. I didn't have that for five years. And definitely, Guy, people told me you're a bad business person. You have to have a mascara to throw one out there, even if it's not like something that you love, love, love. And I said, why would I do that? Like, if I don't find one that's different from everything on the market and formulated without the bad stuff, I'm just not going to do it.

So they saw this thing and they're like, wow, this is different. This is really interesting. And I was trying to play it cool. You were trying to play cool. And but clearly you were in. I mean, that was going to get you in. And once I got in these magazines guy, we catapulted. I mean, of course, the beauty buyer at Bendel said, okay, you've got a counter.

That's it. And you can have an event next month. And I was like, what do you mean an event? Like, what does that entail? Oh, my gosh. But she did say you have to make X amount of dollars a month to be able to stay in Bendels. It wasn't just like you're in. I mean, you had tens of thousands of dollars a product.

But I'm assuming Bendel didn't buy you out, right? No, no, definitely. When you say their first order was a lot, we're not talking about a million dollars. No, no, definitely. $100,000. We're talking about $20,000, $30,000. Yes, exactly. Yeah.

Exactly. And you had the product ready to go. I had the products ready to go. And then, you know, we had our first event at Bendels. And, you know, we had our counter. We had our first event. It was exciting. And you just stood there talking about the product to whoever stopped by your counter?

Yeah, well, I mean, you know, I didn't know what to expect. So I got my brothers and sisters to help me. I bought my brother a purple tie and I had a bartends. I brought in like $8 champagne and put like sweet tarts in a glass. And I called them tartini. and so we were doing tartinis and makeovers. Wow, that's so smart. You had, oh, because it's tar cosmetics and you put sweet tarts in a glass and called them and you serve tartis.

Sheep and cheerful. I didn't, you know. Yeah. And I kept the bottle under the counter knowing that, of course, they would be expecting like Vouv-Clico or something like that. And my sisters and I pulled like potential customers off Fifth Avenue off the street just telling these women that we were serving like tartanies and doing touch-ups. Like after work, of course they were going to pop in. And if they're getting a drink and getting a touch up, why not? And it was really kind of like girl of marketing, you know, before I even knew what that was.

That's brilliant. A tartini. I'd never thought about that. I'm not saying I'm going to go run out and put sweet tarts in a martini glass and pour champagne over it. But it's a great idea when you're marketing tart cosmetics. Yes, definitely. And then, you know, I was like, okay, I've got to like keep getting press. So I couldn't, we had no budget.

So I couldn't afford, you know, $15. messenger so I would put on a baseball hat and I would drop the press packages myself to, you know, in New York City to like the Condé Nast building or like the Hearst buildings. Those are the ones that had like all of the big, you know, beauty magazines because, you know, I just, I wanted to get in all those magazines because it was the influencers of the day. But I would be like, oh my gosh, I hope, you know, I don't hope, I hope I don't see any editors like, oh my goodness, like these women that I saw at the Bendell's breakfast. Meanwhile, these women would never have, like, recognized me from like a hole in the wall. I would be going in through the backside of the

building, right? But then I now am getting appointments with, at these, you know, once it ran in L and once it ran in Vogue, all of the magazines were calling saying, you know, I want to like see your products, like, you know, come in and tell me about it. And so then I would like take the baseball hat off, get dressed up, and going through the front door. Yeah. And it was, it was, you know, really pretty exciting. And you would go in yourself with a package of a bunch of stuff and hand deliver it, because if it was sent through the mail, maybe it might get to them, but if it's hand delivered.

Exactly. You know they're getting it. It feels like, hey, a messenger sent this to you. Exactly. Open it up. Exactly. And then the phone line started ringing. I mean, I had to put fake names on the phone lines.

Like, I'd have my friends and family, like, say, like, hi, this is, you know, Jen from operations, blah, blah, blah, like makeup phone lines. So it seemed like we were an actual company. And then they just sort of ringing as these, it started to, like, hit the magazines. Still doing this out of your apartment. Still doing it out of my apartment. And working with this lab in New Jersey. And I started to get offered calls from, like, so forth. and KVC.

And I just said like absolutely not. I can't, you know, we're, we're not ready, ready yet for that. I felt like, you know, I didn't want to overpromise and under-deliver because I just feel like once you burn a bridge, you don't get a second chance. And were you thinking maybe I should find some investors or not really? No, not really. You know, I never started it to like grow it to sell it. Yeah.

And I feel like it was a very different time then. and I just started it because it was a passion of mine and I loved it. And it was just you, really? Or did you, were you able to hire somebody to help you? It was me. And then I had a couple of interns, actually. One of which is one of whom is still with me. She's my head of creative.

Yes, I still have some of the women that have been with me all of these years, which is pretty incredible. All right. So you are now trying to. to figure out, you know, kind of strategic rethinking, right, as you're getting more and more demand. Yes. But still in Bendels. And I'm meeting my vendors at a coffee shop.

Yeah. You know, a couple blocks away because they couldn't come to my office. Right, because you didn't have an office. Exactly. And being in New York was a huge advantage because that's the center of the fashion world in the U.S. and maybe even in the world. It really was. And you're also in New York on September 11th.

Yes. 2001. I was. And Mark worked there. He worked in the World Trade Center. He did. Yeah. So, yeah, my world came to a halt for sure on that day.

You know, Mark called me in the morning, and I didn't know anything was happening, but he called me and said, hey, Mo, I just want you to know everything's fine. And I said, wait, what do you mean? What's going on? and he said, you know, a plane hit the first tower, but I'm okay. And they're just, you know, I could hear them talking over the loudspeaker. And he said, they're telling us to go back to our desks. And Mark had been there for the first Trade Center incident. That was one in 1993.

Yes. Yeah. So I was like, okay, are you sure everything's okay? And he was like, yeah, I'm completely fine. I got to go. They're telling us to go back to our desks. I was like, all right, I love you. and he's like, I love you too. And then that was the last time I spoke to him. I flipped on the TV.

And I was like, okay, well, he said he's fine, but let me just see what's going on here. So I flipped on the TV. And, you know, I don't know, like maybe I can't remember now. I just blacked out a lot of that time, to be honest, five or ten minutes later, I watched as a plane crashed into that tower. and I just remember, you know, like just collapsing to my knees and really watching as he was killed as the second tower fell. But then, you know, I just, I mean, I just was destroyed, obviously. But then, like, somewhere in the back of my brain, I felt like, no, he's going to be okay. He's fine. Yeah.

Yeah. He got out. Like, I don't know how I could have thought he got out, but I felt like he got out. So I, like, waited for him. to come running through the door. And some of his rugby playing, like, investment banking friends did come to my door. Like, their clothes were tattered and covered in ashes and, like, bleeding, wanting to know if Mark had made it out and had run, like, the, like, 50 or 60 or blocks, like, home like they did.

I mean, it was crazy. You know, their shirts were torn off. I mean, it was horrific, but he didn't. And I was like, well, I got to wait here because, you know, all the phone lines were knocked out. You couldn't get a signal, like, nothing. So I was like, well, I can't, I'm not going to leave. I've got to wait because he's going to come through the door any minute. He's going to come through the door any second, yeah.

He didn't come through the door. So, yeah. Wow. So I then drove to a lot of the hospitals in the city, and that was horrible because I thought, well, maybe he'll be at a hospital. And that was so sad because there was all the nurses and the doctors waiting outside front. like tons of them with wheelchairs, just like a ghost town. You could just drive in New York because, you know, no one was on the street. I mean, it was just ashes, just a mile thick.

But they were just like waiting for people to come, you know, but there was nobody to help. So, yeah. And I just, yeah, I don't know. That was it. I mean, I woke up in the morning and I looked out the window and I just honestly couldn't understand how it wasn't. all the dream, you know. I can't imagine what, just what that was like for you and your family and his family. And my God, in the middle of a tragedy that touched thousands and thousands and thousands of people, right?

All the families of the people who didn't make it. And you're, that was. it. I mean, you were, you were on your own. Yeah. You were about 28, 29. Yeah. Something like that. I just turned 30 and I just thought like I'm a 30-year-old widow and I've, I'd been with him for a decade and I'm lost to love of my life, you know. This is, this is it. I don't even want to go on, honestly, is how I felt. And the city was locked down, you know. It was terrible. I mean, it had like that ash cloud for months and months. And, you know, over time, people just slowly got back to living.

But I just felt like my life was over. Did you think that you were not going to be able to continue with this business idea after that happened? Oh, yeah, for sure. I mean, I didn't want to continue with anything after that happened, period. But, you know, my family and my friends, I mean, didn't leave me alone for one second. I mean, someone stayed with me every single night and every single day. And, you know, they just said, you know, Mark wouldn't want you. You know, Mark was the one that encouraged you to do this. So, yeah. Yeah, like he would be really sad and disappointed if you let this all go,

which I kind of thought was like a little bit mean at the time because, but then it fueled me, you know? Yeah. Because I, and I just became like a walking zombie. And I, and I, I kept dark going in his memory, basically, a year after it started. How long did you? I read about a brief thing that you mentioned about his memorial service, which was, you said it was more of a celebration, really, because he was that kind of person that he would have preferred people to kind of make jokes about him and remember funny things about him. Yeah, I mean, he was just larger than life. You know, I didn't want to have a funeral for him. I wanted it to be.

you know a memorial i mean everyone was just telling amazing stories about him and you know drinking and laughing and crying obviously um it was the new york athletic club and you know all of his teammates and i would say i almost said office mates but no they're all gone i mean i would open up our wedding album and literally every single person in it was gone you know it was just i mean almost every single person in their office like if they weren't there maybe they That day they made it, but that was really it. It was just, you know, decimated. But, I mean, he was just such an amazing guy, like the most incredible person in the world.

What company did he work for or firm? He worked for Keith Rett & Woods. And they were amazing after. I mean, they really were. They're such a good company. So, like, you know, I didn't have kids, unfortunately. I wish I did. but my best friend was pregnant with Mark's best friend from the firm she was a weak pregnant

with his baby her husband she was a weak pregnant and they were just so good to all of the you know all of the widows and then the surviving children and families so I became her kind of Brent was his name so like I was with her and you know, when she had her C-section. And, I mean, it was, it was a tough, you know. I went with her to spread his ashes on Seal Beach in California. How long did it, was it before you were able to say, all right, I got to get back to this thing that I started? I don't even know.

I can't even remember. Honestly, I've blacked out so much of that time. Yeah. That it's weird. It's just like gone from my mind. You were like like like numb. Yeah. Just kind of unconnected to the world around you.

Right. And you know, as I started to kind of try to go back to work a little bit, you know, people would say like, oh, Maureen, you should, you know, you should, you have to answer this email or you have to do this. It would be like good for you. Remember the office was in our apartment. So I would work during the day a little bit. And when everybody left, like the interns and I had one or two employees at that point, I would just like collapse in the bed that Mark and I shared at night. So, yeah. And I kept it in that apartment for many years, which looking back, that probably wasn't the healthiest thing than I could have done many years.

How were you, just for your own mental health, how were you coping? I mean, were you, did you have somewhere talked to a therapist or family? I went on like multi-hour walks every day. I would walk. Our office was on the Lower East Side. And so I would just like walk on the East River all the way down to South Street, Seaport. And sometimes I would do it at night. My family was like, you can't do that at night.

That's really dangerous. So yeah. I mean, not the healthiest. And then, you know, at the time my office, like the girls would go for walks with me, which was really nice. So. Yeah. I mean, and people who experience grief like that, you know, they talk about it coming and going. There are times where it's really intense and times where you can manage.

Yes. Did that last a long time? It lasted a long time. Yeah, it did. I mean, we were together for a decade. So. And then 9-11, remember, it's such a, you know, so like, it's just every year, you know. I mean, that part is tough.

It comes back in the worst kind of way, you know, because that's not how I wanted to remember Mark. Like, by that, the bad stuff, I want to remember all of the good stuff. When we come back in just a moment, how Maureen grapples with grief and figures out a way forward, for Tart and for herself. Stay with us. I'm Guy Raz, and you're listening to How I Built This. Hey, welcome back to how I built this.

I'm Guy Raz. So by 2002, Maureen is picking up the pieces. of tart while learning to manage her grief. And pretty soon, she moves the company out of her apartment and into an office. Her main client is still the luxury retail store, Bendels. But then the cosmetic chain, Sephora, comes knocking. When I met with them for the first time, I thought it was just meeting with, like, one or two people. And they brought, like, David Slittiano, who at the time was, like, the head.

And it was, like, 10 people. So I was like, oh, my gosh, I was feeling very overwhelmed. and it was just me. And they said, okay, you know, this brand is amazing. We've read about it everywhere. We've seen it in Bendels. We want to launch it. We want to launch it in, you know, all of our stores. And I was like, thank you so much. That's so flattering, but I can't launch it in all of your stores, but I could launch it in like three stores. He laughed at me and he was like, I can't launch it in three stores. That's crazy. How about, you know, how about like, fine, we'll meet somewhere in the middle. Like, have it a hundred stores. I was like, I can't launch it

100 stores. Maybe I could like do five stores. I think I settled with like 15 stores. So we started the dot com first and then and then you know we rolled out to four months later to stores, 15 stores. All right. So you get picked up by Sephora but but still in a sort of a small scale. And I guess you know you're still kind of you're growing small. I mean you're you're still cash flow that is financing the business, right? You're not, were you taking out loans? I wasn't taking out loans. Now I'm using my 9-11 fund, which is really tough because, you know, I knew that this is

what Mark wanted for me, but it also felt like, oh my gosh, if I make a mistake and screw this up in any way, shape, or form, I have, like, not only failed myself, but I failed Mark. So it was just like. So, I mean, it is amazing. I mean, his legacy really is wrapped up in this company. It really is in every way. Yeah. So after his death, obviously, his company, as you said, helped out the surviving family members.

So you had some money that you could use to finance Tart. Yes, to continue to finance it over the years because I remember. our head of, you know, like I hired someone from Pricewaterhouse Cooper to do like, you know, all the finance stuff, the accounting. And I hired her while we were still in the apartment. And she didn't know we were in an apartment. So she left, you know, PWC. I don't know, it was big six at the time or, you know, what you called it back then. Oh, you hired her full time to be your finance person. And when she came to the apartment and walked in, she was like, oh my gosh, what is this? Like, what have I done? I already quit my job.

But when we started in the new office, you know, she reminded me it was $12.50 a month, like $1,250. And there were some months that like Tart couldn't pay it and that like I would have to lend the money. Because you didn't have enough revenue coming in from Tart. Exactly. Yeah. And she was your first hire, your first formal hire? She was my second formal hire. My first formal hire was an intern that, you know, had been interning with me and I brought her on full time. And your second hire was this woman with a finance background.

And she's still with me. And she's still the head of finance. Wow. And why was that the second hire? Why was the finance job in your view the most important? Because I'm not a finance person. And I wanted to make sure that all of my hires were people that were strong at things that I'm not good at. Yeah.

I think if you surround yourself with people that are smarter than you, and stronger than you and things that you can't do, and you'll be successful. So you've got this office, and it's a four of you. And so on a day-to-day basis, tell me a little bit about what you were all doing. Like, were you just sort of managing your existing buyers, like calling them, were you trying to get into new stores? Were you calling the lab?

Were you going to the lab? Were you coming up with ways to, were you calling editors, all those things? I was wearing all of those hats. I've never worked so hard in my life. I felt like I was pushing a boulder up, like, a mountain every single day. Yeah. And then just, like, crashing in bed at night, kind of depressed, you know? Depressed?

Well, just because... Yeah. Yeah. So, but, like, obviously happy that the company is growing and doing well. So, like, I didn't have time to think at all during the day. It was so busy nonstop. Yeah. Just because we were growing and didn't have a lot of resources.

And then at night, you know, your mind would, everything would get quiet and your mind would, you know, would just start to slow down and, like, think, a little bit. You got remarried in, I think, 2004. I did. And to the husband that you're married to today. Yes. What's his name? His name is Scott. Scott, okay.

Yeah. I feel like he and Mark would have been best friends for sure. And he was also, was he working in, like you met him in New York? I actually met him. He went to Wharton with my best friend from undergrad. And I met him when we went to Boston. We were selling in a little apothecary that's since out of business called E6. And we needed a place to stay because we still were pretty scrappy. And my best friend, Raquel said, well, I can stay with Scott, you know, from business school. We could just stay there and I was like, okay, sounds good.

And that's when I met him. And, yeah, and we got married in 2004. Wow. And he eventually came on board to, like, help at Tart. He eventually joined the company. He did. He moved to New York for me and he was in finance. And then he became an FBI agent for a little while.

Wow. A couple of years, yeah. And then he loved it so much. I mean, it was like the favorite thing he's ever done. But I just, we were starting to really be drowning. And I, you know, he had his CPA and his MBA. And I just said, like, I need the help. Please, like, just come help, even for a little while.

And so he kind of took a leave of absence and came on board to help. But unfortunately, never made his way back to the FBI, which he's still sad about to this day. And it reminds me. He said, you know, gosh, it's so different here. You know, girls cry, you know, when they break up with their boyfriends. It's very different from the FBI. I was like, yeah. When, I mean, even by 2005, right, when you are in, and that's the year where your mascara makes its debut, which I think becomes a big hit.

But even with the, like, the magazine placements and being in some of those stores, like, you still needed to market the product. And I can't imagine you had a massive budget for advertising or promotional things. How did you get people to be aware of your products? Yeah, you know, we've never spent $1 in advertising in Tart ever. You know, in the beginning, we never had the money to. And then obviously as time progressed, you know, that changed a little bit. I think Facebook started in 2004. So if you think about that, you know, social media.

MySpace was like 2003. you know, we hopped on the influencer trend pretty early, which was definitely great for us, and started sending it to influencers or people we thought were influencers. Just sending them free product and hoping that they might write about it on their blog or whatever. Exactly, or put it on their Facebook page. Back then we would send it to, I did have PR back then, in-house. PR. So one of the early hires was like part-time PR person. So we would send it. And she would pitch or he would pitch to who? They would send it to celebrities. Like there was a data,

there was a database then and there's a database now where you can like look up like, you know, where to send celebrities products to and things like that. So we would just like send it out. And the hopes that maybe they would open it up and like it and talk about it. Exactly. Exactly. You know, I would keep sending it to the magazine. So I would I remember sending it to Gail, Oprah's best friend. And Gail... Gail from CBS. Gail came.

Yep. Mm-hmm. And Gail gave it to Oprah. And Oprah put it in her... Oprah's favorite things. And it was our double-ended lip glosses. You snap them apart. They were named after famous lovers, like, you know...

Romeo and Juliet was one of them. Yes, absolutely. Retton Scarce. Charlotte, like Hamlet and Ophelia, even Carrie in Big. And once we hit the Oprah O list, it was like, oh, my gosh, unbelievable, like, flying to the moon. I mean, you had made it, you know? I mean, because Oprah, remember, I mean, still is very influential. But back then, it was just everything.

She was the influencer. She was the OG. I think I would think this was a turning, pretty important turning point for the growth of the business. which was 2005. And that year, you signed a deal or contract. I don't know how it works with QVC. Yes. And basically, you go on it and I shouldn't be explaining this because I think everyone

listening to this knows how it works. I'm just explaining this to myself. You go on and there's a, you get like, what, 15, 10, 15 minutes to talk about your product and there's a number and people can call and order it, right? Exactly. And how much time would you get on QVC? Eight minutes. And you still do to this day. It hasn't changed.

Are you selling a bunch of things or just one thing in that eight-minute period? Generally, it's one thing unless it's a TSV, in which case then it's a kit. So all of your products in 2005 were obviously unique because they were paraben-free and vegan and cruelty and all this stuff. But you had one product that really was totally different, which was the cheek stain, right? Yes. Was that? Did you patent that? Did you? I didn't. Remember, I had no business experience.

I, you know, which is okay, looking back, I didn't patent my fabric packaging, I didn't padden my cheek stain, but we launched it on KBC and it sure did sell out. I mean, those phone lines lit up. And how quickly before competitors jumped on that idea? I mean, it took time, actually, which was pretty great back then. I feel like not everybody copied everybody back then, which is lovely. I don't know. And I felt like I was constantly moving back then. It was like, okay, what's the next cool idea? What's the next fun thing? I was always trying to like, you know, really like be different and think outside the box. But, you know, I think back to my QVC days. And while it wasn't sexy, I mean, QVC saved us because it just helped us grow.

When you think about catapulting to another like level of sales, you know, you can go on, especially in Q4, like holiday time and do like $23,000 a minute. Yeah. I'm sure. I'll have to share this. But, and when you're, you know, young and you're selling. It's amazing. And you're in control of your own destiny. Yeah. And you come off and you've sold, let's say, I've sold like $20,000 a minute.

And you have a buyer say, okay, well, you didn't get gold because it was 23. And I'm thinking, who cares? I just killed it. Yeah. Yeah. Were you, when you first started going on QVC, I mean, you have no idea how many people are watching at any given time. A hundred and one million, but no, I did not know then. How many?

101 million. 101 million? Yes. At one moment, how is that possible? 101. And I love QVC. I have to say, I just... Wait, 101 million?

That's around the world? Yeah, viewers. That's like the Super Bowl. Yeah, they're clicking over from the nightly news and, you know, they channel surf. So they're never going to watch your whole... I always say, because now, while I don't tell myself on air anymore, directly, I help the girls that do sell with their cells every single week. And I just remind them, I'm like, remember, the only one watching your full eight minutes is your mom and us. Right. And you're with somebody else,

right, from QVC who's sort of asking a host. Yes, a host. And is it, was it nerve-wracking? Yeah, it was nerve-wracking for sure, especially because we were growing. We were definitely in growth mode at that point. And, you know, every hit was, it was on consignment back then. And so, you know, you ship it to them and you don't get paid until you sell it. And so for us, we had already like paid the lab and paid the packaging company. And so we needed to get paid. So. And probably you have to price it at a price of QVC wants you to price it at. Exactly. It had to be more competitive for sure. But I looked at QVC. Yeah, it's kind of like more like an infomercial because you're selling it to all of those 101 million like eyeballs and ears. And then, you know,

they may buy it there, many do, but they also may stroll into Ulta or Sephora and buy your product there because they want to touch it and smell it and feel it. So, all right, so you're growing at a really healthy pace and not at a kind of explosive pace because you really are still self-financed. I think the company starts in 2000 by 2007. You're at around 15 million in revenue. So still a small business. But growing at a health the pace. I think you had about 25 or 30 employees roughly at that time. Does that sound about right? And then we hit the beginning of what would become the Great Recession in 2008. And I read that at the time, like almost 60% of women cut back on cosmetics. And many cosmetics companies saw pretty significant declines around that time. What happened to your business? We were fine. I mean, we were just growing. We were still in like super growth mode.

So for us, we were doing great. We were just scaling on QBC. And, you know, I would be driving, commuting two hours into the city. Then I'd, you know, I'd work all day. Then I'd drive to Westchester, Pennsylvania. I'd sell on air. And I'd drive home. I had, you know, at this point now, two kids, two little little kids. So. Living in New York City? We actually have moved out, I think, at that point. So when they think back on me, like, just, I don't know, my time selling on KVC, they're like, we never want you going back on air. You were driving from New York to Pennsylvania once a week? Yeah, or twice a week, and you get home really late. It was like Friday night beauty, and then sometimes you'd have to be on, like, Saturday night, too. So it was a lot.

But, you know, I mean, I definitely loved it. And that was helping us to really grow. So that year, 2009, were you still sourcing all of your product from that lab in New Jersey? Or were you also sourcing it from other labs at that point? We were sourcing about 60% of it from that lab in New Jersey. From that original lab that agreed to take you on. See what you did for them? You gave them a lot of business.

I know. I know. But you know what? It's a good, good tale of like making sure you diversify, which we. We of course have since then because, okay, two really big things happened. I finally decided that we needed private equity. You needed outside funding. We did because we were going to go in Ulta and launch in 364 doors.

And that means you need a lot of product and you needed money to make that product. Yeah, we needed a ton of inventory. We were going to need a field team. team is to go out and to make sure that it's placed right and also like sample it for people. Exactly, exactly. And so. And that costs money. It costs money. Yeah. And so we had met with tons of private equity firms. You know, I'd heard the horror stories through the years. You know, on KVC especially,

there would be a lot of other founders and they'd say that they got pushed out or their teams got fired and they were like, be careful, be careful. Remember, we had to, we had. 11 years at this point. And so I finally found a private equity firm that I was really happy with. They were called Encore and this guy, Kevin Murphy, was such a good guy. And they signed an LOA because we needed that money for the Ulta expansion. And it was really exciting. And they, so they made an investment in the company. Well, they signed a letter of intent, right? Okay. But literally days later, I got a phone, we got a phone call, one of the girls in the office. from one of the truckers. They're not our trucker, just a trucker that we work with. And I think

this is a good example. If you're good to people, they'll be good back to you saying that there's something weird. There's like activity happening at the lab. And I was like, wait, what do you mean activity? Like, just something weird is going down and like, you should come down. I was like, okay, shoot. So I hop in a car. I drive over the bridge. And I go in and I said, like, hey, you know, what's going on here? Is everything going okay? And they said, we have really bad news, and we're so sorry to be telling you this. I don't even know how you're here, how you knew this, but we're going out of business. And it's happening right now. I was like, what? Wait, what? But how is that possible? They were making 60% of your product, presumably they were doing okay.

They were doing okay. We had like a couple of little blips where like we did like mini cheek scenes, like travel side cheek stains and they got like a little soft. They were. a little like mushy like cranberry. And then we had an issue with like a foundation where it was like what wasn't pumping out, but like we worked through it. So like there were like a few little signs. You know, looking back, there were a couple signs that I should have. And I did. I was on it. And I was like addressing those concerns with them. I was meeting with them and stuff. But there was no like signs of this going out of business. Of course, I was like, oh my gosh. I was like, okay, well, when is this happening? And they said immediately this week. We're closing.

our parent company is closing our doors. Wow. So I was like, what about our products? What about our packaging? They were storing a lot of our stuff there because they store your packaging to then fill it eventually. And they said, I don't know, the bank is taking it over and, you know, it's not going to be ours anymore. I was like, what do you mean? And so Scott, my husband at the time, said, you know, when that happens, they usually put a lock on the door.

and then the bank owns it all until, you know, you can fight it out in court. And I was like, but what do you mean? That's, we own that stuff. Like, what do you mean the bank's going to come to own it? That's insane. Like, we paid for all the packaging. Oh, and they locked you out? No, they would be locking you out.

So I turned around and I went out and I rented an 18-wheeler truck. Wait, where? Did you go to like a U-Hull? Okay. It was insane. It was so insane. I've never my life done this, but I was like, what am I going to do? What am I going to do? And everyone from the company came, you know,

came over and I got family and everybody loaded up as much as they could. We definitely didn't get everything, but we got as much as we could. And then literally the next day the doors were padlocked because Estee Lauder, L'Oreal, they all manufactured there and they made products for like, you know, Bobby Brown and tons of companies, you know, because they're They own them and they couldn't get any of their stuff for a year and talk about expiration dates, right? Like makeup expires. Yeah. All went bad.

So we would have gone bankrupt. Bankrupt at that point. And all of our bank loans were personally guaranteeing, guaranteed like by us. So like, you know, including like our house. So, you know, private equity was going to be taking some tips off the table. able sure, but also making sure that we didn't lose our house. And remember I said that Scott was an accountant. And so like at the time he would sit and like figure it out all the time. Like, and you know where we were kind of like numbers wise because I was just like we were out of money.

We get really close to being bankrupt if our retailers didn't pay us or if our suppliers didn't supply us. Like, you know, just anything went sideways on us. We were technically bankrupt like every other month for 2008 and 2009. Even though your revenue was strong. Yes, just because we didn't have the money. So what happened to the investment offer? So they absolutely could have walked away. I mean, they probably should have walked away. But this guy, Kevin Murphy, I mean, like, I didn't know him, but like he stood by us.

And he said, we're going to do it. We believe in you. We invest in people. and we believe that you guys are you're going to pull through this. And we did. But it was really, really stressful. We managed through all of it. This is Encore consumer capital?

Yes, yes. And so they made an investment. And what did that, what did that investment allow you to do? Was it, I mean, did it allow, it allowed you to basically serve the ALTA buyer? It allowed you to make enough product for that ALTA to serve all those stores. Well, the irony is, um, guy that by the time it came through, we were already launched in ALTA. Wow. And so they doubled their investment.

They doubled their investment. But like, it's the kind of thing where if we weren't okay, it was all sideways and we were bankrupt. And it was all, it was all cash flow. Yes, all cash flow. And but when you say we would have been bankrupt, it's because personally. Cash flow, it's like, right, it's there. There's, you know, if you're, I don't know, 30 days or what, just a few days between having the money, not having the money, waiting for the product. And so you're saying if that, if you could not get your product from that bankrupt lab, that would have been it.

That would have been it. Yeah. And the banks would have called in like loans and our house was tied to it. I would have literally lost everything in my entire life. And if you think back to, you know, just Mark and everything. everything that I did in his memory to like invest and just, yeah, I just, I would have lost it all. I would have, I would have ruined everything. So, all right.

So you get through and you've got, you've got an investor. And the company is growing. And then 2014, you get an offer to be acquired, a Japanese company called Kose, I think it's pronounced. Yes. They acquire you to announce in April of 2014. How did that come about? I think once you take on private equity, you know, they'll always look for an exit. I think that's always going to be kind of the end.

Yeah. So you knew in 2010, once you took that money on, that there was going to have inevitably be an exit. I did. I did. you know, which it was definitely like a slower exit for me, which I think was good because, you know, I loved what I was doing. But Kose is kind of like the equivalent of like a lotter or a L'Oreal in Japan. And they were looking to acquire our company that they could study and learn from to like really help them with their marketing in the same. States and so they kind of felt like Tart would be a great, just like a great one for them for that. And I wasn't ready to kind of like hang up my high heels and be done for sure.

So Cozé was like a good match for me. I knew that if I went with like a lot of, you know, a lot of Laurel, it would be different. Like I wasn't ready to go lay on the beach forever. Like I like working and I like doing this and I just felt like. Like they were a good partner that would allow me to do that. And I maintained like a surprising level of control, given my remaining ownership percentage that I did put in the shareholders agreement to make sure that it remained that way. So they bought, I think, about almost 94% of the company, 93.5%. Right.

And you kept a percentage. And you wanted to stay on as a CEO. I did, yeah. I did. Yeah, I just wasn't ready to be done. They bought it for, I guess, around $135 million, which is amazing, an incredible exit for a brand that you started, you know, in your apartment. But you really, I mean, you're still the CEO today. That happened in 2014. Yes. And so we're approaching nine years since. Crazy.

Since that, at the time of this recording, nine years since that happened. And you're still the CEO. Yes. I am. And in 2020 is when my final like shares were done. And at that point, we were valued at 2.3 billion. Wow. Yeah. And tell me, I mean, how many, how many employees does Tart have now around the world? I think like 250 or so. And so, it's pretty, it's still pretty manageable. Yeah. And, and, and I mean, from, I mean, but still like running a, you know, obviously not everybody is a. direct report to you. But still, you oversee that team. How have you, what's been helpful for you to kind of develop into the kind of leader that you have become? I mean, did you ever like hire a coach or get a mentor or did it just kind of over time, you just kind of figured it out?

Yeah. I mean, I have to say a little of both. I've definitely had mentors over the years. I think they're really important and read a lot of, lot of business books. But I think that it's really important to recognize as a founder and as a boss, like what you're, that you're not the expert at everything. And I just have some really amazing people around me. I have a president. I have a all-female C-suite, which is something I'm very proud of. It's very unusual, believe it or not, in the cosmetic industry to have women at the top. And yeah, I mean, I love everyone I work with. I feel very lucky.

It's the thing that keeps me still going, and it's the thing that keeps me still at tart is the people. It's always been about the people for me. When you think about your story, right, and all that you've been through and all the ups and downs and there were certainly some really major downs. How much of where you are today do you think has to do with your work and your work ethic and how much do you attribute to luck? Oh, I think both. I think luck and hard work for sure. I think that I've worked really, really hard and have had a lot of support throughout my life.

But I also feel like I've been lucky. You know, I'm very blessed. So I feel like both of them, for sure. That's Maureen Kelly, CEO and founder of Tart Cosmetics. By the way, despite never advertising nor even using professional models, Tart has grown a super loyal customer base who the company calls, if you guessed it, Tart Letts. Hey, thanks so much for listening to the podcast.

show this week. If you want to contact the team, our email address is H-I-B-T at ID.Wondry.com. If you want to follow us on Twitter, our account is at how I built this, and mine is at Guy Raz. And on Instagram, I'm at guy.org. This episode was produced by Carrie Thompson with music composed by Rumpteen Arablewe. It was edited by Andrea Bruce with research help from Sam Paulson. Our production staff also includes J.C. Howard, Casey Herman, Liz Metzker, Alex Chung, Elaine Coates, John Isabella, Chris Messini, and Carla Estevez. Our intern is Susanna Brown. I'm Guy Raz, and you've been listening to How I Built This.