Abhilasha MishraFounder, Business Escapades · Host @Business Escapades

Are all celebrity brands VC backable?

25 Aug 2025 · 1 min

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1:00

In this short video, the speaker argues that the vast majority (90‑95%) of celebrity‑founded brands are not attractive to venture capitalists. The core reasons are: (1) limited market size – VCs seek businesses that can scale 20× to reach billion‑dollar valuations, whereas many celebrity brands cap out at $10‑$20 million; (2) heavy reliance on the celebrity’s personal brand, creating a key‑man risk that threatens longevity if the star departs or tarnishes their image; and (3) lack of defensible intellectual property or a moat, making the businesses easy to copy once the celebrity’s name is removed. These factors together misalign celebrity ventures with the “home‑run” investment thesis that VCs pursue.

Chapters

90, 95% of the celebrity-founded brands are not VC-backable. And it has to do with market size. Like as VCs, we're looking at businesses that can 20x. So we are looking for the billion-dollar outcomes. And a lot of these celebrity brands, although it could be like a nice $10 to $20 million business, that's not gonna change the VC's life, right? Like we're not in the single business, we're in the home run business. So just the expectations of a lot of these celebrity-founded brands and the platform, the ceiling that they have, it just doesn't align well with VCs in general. It also has to do with like the dependency on the celebrity. Can it actually outlive the celebrity? Not a lot of celebrity-founded brands can because it's just too dependent on like the celebrity itself. Mm-hmm. It has to do with like, yeah, IP. If we are like being approached by another like tequila brand or skincare brand or apparel company, they often don't really have a moat. So it's super easy to copy. The only thing that's not able to copy is the celebrity's name. But if the celebrity eventually like leaves the company or does something stupid, you have like a complete key man risk.