How PRs can help corporates navigate founder brand acquisitions

With trust and authenticity continuing to be high on consumers’ agenda, founder brands that put a face to the name and have a carefully crafted, and personal origin story not only help establish their place in the market, but keep the spotlight firmly in their focus and possess a high degree of customer loyalty. 

With this success, it’s not surprising that founder brands have become prime opportunities for global corporations looking for their next acquisition. But by its very nature, while providing a significant pay day, these types of acquisitions can pose a serious risk for these brands, and their investors, which have been built as the ultimate extension of the founder.  

Founder brand success 

Social media has been essential to much founder brand success, providing an accessible medium through which founders share behind-the-scenes content, company updates and engage with customers in what often feels like an unfiltered dialogue. 

It’s what we see with the likes of Caroline Hirons and Skin Rocks, which adopts her trademark honesty, independence and decades of experience to entice and hypnotise her 735,000 personal Instagram followers and sell-out product launches. 

Kestin Hare and his eponymous menswear label has built a cult following and is stocked in more than 90 international stores, thanks to carefully curated designs that are more a tapestry of his love of Scotland and childhood memories than trends. 

Ella Mills and her plant-based powerhouse, Deliciously Ella, has followed Mills’ personal health journey and gained 2.4m Instagram followers, sold more than 100m food products and bought its own UK-based factory along the way. 

Deliciously Ella 

But one is unlike the others; Deliciously Ella was sold to Swiss food group Hero in September. It marked a departure from the founder brand club. The way that the announcement was made and the content that followed has, so far, provided reassurance and remained true to the brand and community Ella masterfully created.  

Of course, not all founder brand sales are managed in the same way, revealing valuable lessons for communications professionals.  

For example, Glossier – a cultural touchstone of the 2010s went through a period of change when its founder CEO, stepped down. While remaining involved as executive chairwoman, the brand became more ‘corporate’ in tone and customer loyalty lessened, with Fenty Beauty and Rare Beauty surpassing Glossier in brand innovation, inclusivity and the micro-influencer and personal approach on which it was founded. 

Expanding founder brands 

Lesson one: When scaling up and expanding into new markets, don’t forget the community-centric ethos and ‘behind the curtain’ feel, which paved the way for this growth. Customers often feel at one with these brands, and a shift away from personal tone can feel like they are no longer seen, or worst, welcome, which can lead to a drop in engagement and harm sales. 

Also in the makeup space was Kylie Cosmetics and the sale to Coty which made Kylie Jenner the ‘youngest self-made billionaire’. Remaining the face of the brand has paid dividends and ensured continued relevance, but one year post-acquisition, Coty’s CEO, Peter Harf acknowledged strategic errors, including rushing into the partnership without fully understanding how the brand lives and breathes, resulting in operational hiccups and slower sales.  

Lesson two: Remember comms and marketing 101 and get under the skin of the founder brand to understand its origin story and consumer values and behaviours. These insights will be invaluable for operational decisions, product development and marketing partnerships, including determining how to identify a new face, or faces of the brand. It will also support continuity and authenticity in the brand’s tone of voice, helping maintain its market share. 

Another is Bumble, which rode the wave of dating apps in 2014. Founded by Witney Wolfe Heard, it amassed more than one million users by the end of its first year, later being acquired by Blackstone. Wolfe Heard stepped down as CEO earlier this year but it has been a multi-year transition which has helped steady the brand and its billion dollar valuation while continuing to attract users. 

Lesson three: Have a robust and lengthy successful plan in place. One that supports internal communications and speaks to everyone from entry-level staff to C-suite, while upholding company culture, transparency, values and mission – in Bumble’s case, championing women to ‘rewrite archaic gender roles’. Much effort is rightly placed on reassuring consumers and external stakeholders, but the team that brings the brand to life should not be forgotten – a company’s employees, are after all the most influential factor in how a brand is perceived. 

It's a small sample size to be sure, but what’s clear is that much of the success in founder brand acquisitions rests in careful short and long-term planning that is supported by a communications strategy that provides reassurance and stability, to internal and external audiences, and simultaneously builds excitement for this new chapter. Above all though, it’s vital to remember the founders’ personal touch from which these brands have grown, honouring the origin story that made them worthy of acquisition in the first place. 

Victoria Cameron is associate director and deputy team leader at PLMR.