EP119. Taking cosmetics transparency to the next level

As the clean, green and organic movement has taken hold in the beauty industry, so has the need to understand what these terms actually mean. Although the word organic is fairly well defined around the world, we also know that no one really knows what clean or natural beauty actually means. Everyone's definition will be slightly different. In fact, I've dedicated whole episodes to how we interpret these two definitions alone here on the Green Beauty Conversations podcast. And as the industry and its consequent confusion grows, so do the number of standards. Your ingredients can now be certified organic, natural, microbiome, friendly, vegan, halal, cruelty free, kosher clean, safe, palm oil free, gluten free, GMO free. Need I go on? But it doesn't end there. Particularly in the US where cosmetic regulations do need considerable improvement. Retailers such as Credo, Sephora and Target also have their own internal standards on what clean, natural and sustainable means to them. But what do you do if you're running a beauty brand and you want to make sure you tick all of the boxes? How do you meet standards that simply aren't globally harmonized? How do you future proof for selling into certain retailers? And more to the point, how do you actually know exactly what your ingredient suppliers are up to before you buy your ingredients from them to ensure that you meet those standards? My guest today is Yashi Shrester from Novi, a platform designed to sort this whole mess out. Stay tuned for a fabulous interview in which you're going to learn exactly how one company is on a mission to make the product development cycle more transparent and more sustainable. Welcome to Green Beauty Conversations, the podcast that challenges you to think about how you buy, use, make and sell your natural beauty formulations. We tackle topics that will make you think and encourage debate about green beauty with your friends, friends, followers or customers. I'm your host, Lorraine Dalnaya. I'm a chartered environmentalist, biologist and the CEO of award winning online organic cosmetic formulation school Formula Botanica. We have thousands and thousands of students in over 180 countries around the world who study with us to become organic beauty formulators and entrepreneurs. Visit our website atformulabotanica.com to try our free online formulation course. And if you want to be the first person person to know what's happening in green beauty, make sure you subscribe to this podcast in your favorite podcast app. So in today's episode, I'm joined by Yashi Shrester, Director of Science and Research at Novi, a turnkey solution for formulators to build beauty and personal care products that meet the complex transparency needs of today's consumers. Novi does this by gathering detailed raw material information directly from suppliers and making it possible to easily cross check against regulations and retailer standards. Novi enables transparency and compliance without the paperwork and endless reformulations. Hi, Yashi, welcome to the podcast. How are you doing today?

I'm doing well, thank you. How are you?

I'm great. I'm excited for this interview. So thank you so much for joining me.

Yeah, thank you for having me. I'm excited to chat through everything today with you.

Yeah, yeah. Well, let's get started. So what is Novi and what is your role in the organization?

Novi? We are a solution for consumer goods in the personal care and beauty space, helping brands really elevate the transparency into their supply chain to make informed decisions as they're getting products out in the market. My role is I'm the head of science and research at Novi, so I strongly believe that the data is where everything is at and so making sure we're able to collect and get relevant data in order to help brands know exactly what's going on behind everything, make those decisions.

So, love it. I love it. So obviously we're going to go into a bit more detail about how Novi works throughout the interview. I won't bombard you with questions straight away, but I think the first question then I really want to ask off the back of that is why was Novi started?

Great question. So I've been in the brand side of the industry, done a lot of the regulatory sustainability checks when releasing a product, when there are so many brands that are wanting to meet the different standards that exist, oftentimes they are unable to do that because they haven't had that transparency into who their manufacturers are or what ingredients they're using from what suppliers, and going all the way down to those supply chain and so realizing that there is a need for that information to be available. And so many brands are wanting to tap into that information so they feel good about the decision they're making, but also how they're marketing their products. And so really that was the impetus of Novi being started and we've been able to solve many different problems with that lens in mind.

Yes, I can imagine you do. So a beauty brand signs to your platform and then at that point they can effectively upload, upload the information about their formulations and each ingredient is effectively verified and then you can effectively tell those beauty brands if they're meeting certain certification standards or certain retail standards. Have I summarized that correctly?

Yes. You got it. Yeah. And all of the above. Yep.

Perfect. So do you find that beauty brands feel slightly overwhelmed by all of the different standards and certifications available. Is that one of the big drivers for them coming to Novi?

Absolutely. Oftentimes they come with, they all have big goals and, you know, wanting to do the right thing of bringing out products that are a human health environment. But like you said, there are so many standards that exist. So oftentimes you know, what brands come to us or want to know is what exactly does select selecting a certain standard mean or what does, what does detoxylated chemicals mean and why should I avoid it? So what we're able to do or what brands want to know is how does this impact my end of life footprint? And if they only knew what exactly that meant, that means they can choose what path they want to take. I always say sustainability or this clean movement, it is progress and not perfection. And everyone starts somewhere. And so when they're bombarded with all these different standards, it can be overwhelming. And so knowledge and getting data.

Absolutely. Knowledge is power, as we all know. So I want to dive into the detail of how the platform works in this interview because I'm absolutely fascinated by what you've created at Novi and I didn't really fully understand it until we spoke with each other before this interview. And I've spoken with Kimberly before as well, who runs Novi. I mean, clearly you've created something incredible here. So Novi lists ingredients in the back end of its platform and you then drill down to feedstock level to explain what their chemical composition is and how they're made before then making this information available to the brands who pay to be part of your platform. Now, I know that our community is probably listening to this and jumping for joy at the moment, so can you please walk me through how it works? If I'm a beauty brand and I want to know more about my ingredients, so how do I use Novi to achieve that?

Yeah. So, you know, with every chemical, every ingredient, there's few ways you can have data sources. So there's science, the chemical, the research that comes from academia. There is the regulatory landscape and what's coming up from authoritative lists, regulatory bodies. And finally, it's really the suppliers of the ingredients they create, the data they're in. They're the ones that are selecting what feedstock, what processing needs to put into those chemicals so those ingredients can be made. And so what we've been able to do is tap into that network of suppliers, which has not been done before, and really build our relationship with those suppliers to understand the makeup of those Ingredients from how it's manufactured, what feedstocks are being used, what processing aids are being used, what's the full composition so that we can have this information upfront, protect that on our back end and be able to assess it from a whole 360 for each ingredient. So it's not just, just not the chemical name, deciding whether it's good or bad or, you know, simplifying that it's more so also how it is made and what goes into it. So it's been the network with suppliers that has enabled us to be able to even gather that data to begin with.

And that is incredible actually, because obviously having worked with many ingredient suppliers over the years, I know that well, most of them, if not all of them, can be very, very protective about the process that goes into making, for instance, functional ingredients such as emulsifiers, surfactants, preservatives. And of course there's a reason, for instance, that so many of the ingredient platforms, such as Cavallo, who've been here on the podcast with me last year, or UL prospect behind a login, it's almost like shrouded in secrecy, isn't it? It's been really hard for indie brands, the formulation community, to gain access to that information. So how hard was it to convince those suppliers to share more information than they're potentially used to doing?

Yeah, I mean, I'd say it's definitely dependent on the supplier, but ingredient suppliers are also realizing why it's important to be more forthcoming with data and be more transparent. And I think I understand their hesitancy with not wanting to release IP or competitive data to other suppliers. But you know, what we're able to do is because of the data they give us, we're also able to give that same analysis back to them and see do your ingredients meet a retailer's policy or the different authoritative policies. So because of that, it's been a win win for both sides because suppliers are also able to now have more data and information around their products and how they can market that and you know, and at the same time allow brands that want to use those ingredients be more sure about it upfront and get that visibility. Definitely a progress. Definitely. You know, over the last few years it started with more hesitant and now majority of the suppliers realizing the value and the extent of sharing this data to be upfront.

Well, perhaps they now see that it's part of doing business in the sort of modern formulation community. What level of investigation does your team undertake if you want to vet a new supplier or A new batch of ingredients, like what would you do in the back end?

Yeah. So we have list of different documentation needs or testing methods, different criteria that would be required to validate certain claims. We're not on the ground with the suppliers to be auditing and checking them, but we do have that trust agreement to know that anything they share with us has to be documented and provide us all the information to support that. So our team, the science and research team, actually the team that I lead, we look at every document that comes through. We have a system that processes all the irrelevant information. There's any discrepancies, we're able to flag that as well because with the upkeep of documents, suppliers may not be on top of it. So we're also able to help them identify there's things that may not be current and how they can update that. So a huge portion of what our team does is to make sure those documents are accurate. And then once that comes through, our engine, our vetting engine is able to then pick up each attribute and do the math logic to say XYZ criteria are met, therefore it fulfills the policy and creates that output for both the suppliers and the brands to see. And so pretty intricate in the back end, but all, you know, all powered by data.

Amazing. So just for context, how many ingredients have you roughly vetted so far using this process?

I would say it's close to 40,000.

Wow.

Yep, exactly. And especially because our backend is the logic is that we have the infrastructure, so it's just a matter of getting the information and we can run as many as possible to spit out those outputs.

That's really impressive. I mean, 40,000 is a lot of work and I'm sure your team has been working very hard over the last few years to get there. So do suppliers always fully know what's happening in the synthesis of their ingredients or have you sometimes uncovered something that they weren't even aware of?

Yeah, I think it depends. So I'll say majority of them will have different team members within their organization that have some data. And so it's a little bit of chasing to find that information. But yeah, there are times when we've been able to tell suppliers, hey, you're marketing something as being, let's say, a non ethoxylated emulsifier, when clearly it's gone through a process that includes ethylene oxide and, and they take it with a lot of grace and have been appreciative of us finding that information because at the end of the day we're just trying to empower everyone in the industry through data and knowledge. Right. So, yeah, we've had certain instances where we've found impurities or within certain chemicals that brands are really looking to move out of. And so helping suppliers understand how they can have processes to either filter or purify or use different feedstocks to not have any residual contaminants in the system.

So fascinating. What's the trickiest sort of ingredient to vet through a process like this? Are there any particular groups of ingredients that stand out as giving you more of a headache than others?

I'll say not a headache, but definitely more challenging and exciting in that sense is probably, as we know, fragrances, right. We have fragrance suppliers who typically are very secretive about what goes into the composition of each fragrance. And so we've actually been able to work with certain suppliers that are willing to disclose the full composition. Very few, but full composition of their fragrances. So we can vet it. They still don't want that to be shared out with brands until there is some kind of transaction or business agreement that they're going to purchase it. But at least they're allowing us, as novi, to vet those materials in full and be able to give brands that assessment. To say, you know, you may not know exactly what goes into that fragrance in full, but we've done the part of telling you whether or not it meets the standards that you care about. So that would be one that I can think about. As you know, one study around PFAS came out last year. There was a lot of conversations we had with suppliers to say it's not a standard test that has been existing. And really, brands may be doing testing on a product level, but it's really going down to the raws to understand where those contaminants are coming from if it's not intentionally added. And so that's been some work with the industry in terms of what is those test methods and how do they report what they have found and how do we interpret that when a brand selects those ingredients?

Sounds like you've had some very difficult conversations from time to time as well. But obviously that's what underpins the platform and generates that trust and transparency between brands, brand and supplier. Have you ever learned anything about an ingredient that surprised you throughout this whole process?

So many. I mean, I think it's. I can't think of one on top of my head, but I can tell you, learning how certain ingredients can be sourced from different botanicals, for example, or. And how that affects the end texture or the performance in certain ways. So like just the different things that ingredient suppliers focus on in terms of, in terms of the testing they choose to do or choose not to do in terms of making some claims. So a lot of learning.

All in all, what's been the uptake of the platform so far? How many beauty brands have you got on there? I know you're working with some retailers as well, so give me, give us a flavor for what's happening behind the scenes.

Yeah, so we actually have about over a thousand brands now active on the platform and using different levels and capacity. Like you mentioned, we are partnering with different retailers. And so what this means is, you know, you often see retailers have their policies or restricted substances list on their website, but what you don't see is the exhaustive list between each chemical group. You know, for example, when you say banning chemical sunscreen. So exactly what are those ingredients that fall into those categories? So we work closely with retailers to actually build, ingest their entire exhaustive list so that any ingredient that brands select, we can assess it in full and not have them wonder whether or not this chemical falls under a category that's been banned or restricted. And so with retailers in the industry evolving, with new data, emerging and scientific data coming up, so there's always changes that's happening. And so with our partnerships, we're able to get access and code our system with those upcoming changes. So whenever it goes live, all of the brands know immediately how it impacts their existing product portfolios or as they're developing new products. What do they need to be aware of that they didn't when they launched maybe another product two years ago?

Fascinating and amazing. I mean, what an uptake over a thousand brands. That's incredible. Congratulations.

Thank you.

So off the back of that, I know that Novi raised over $40 million in investment funding earlier this year. Huge congratulations to everyone at Novi. That's an incredible achievement. And that suggests you're going big, you have big plans. So what are the growth plans at Novi? What's the vision?

There's so much to solve and so many problems that we can think of solutions to help brands with. I'd say immediately, you know, like I mentioned, we have a lot of brands that have come to us to vet their existing portfolio of products. And oftentimes they realize they don't have the transparency or the visibility into those exact ingredient suppliers just because of the nature of the industry. And what they've come to us is we want to know upfront where the, what ingredients are being used or what we should use and how do we proactively develop products that are sustainable or meet their own standards. And so we're taking that on from working through the end of life to let's go all the way to the beginning and work from a playground of ingredients that are compliant versus, you know, cross your fingers at the end of their life cycle to hope that you're doing the right thing. That's what we're venturing into is, you know, helping these brands get access to information upfront.

Amazing. And presumably there'll be more brands, more retailers, more suppliers involved in the future as well.

Absolutely. Yep. There's new innovation, especially on the supplier front that's coming up every day. New alternatives to ingredients that have been linked to any hazards as they grow. We want to be able to bring them on, assess them through our platform and then bring those in front of brands that are looking to innovate and bring amazing products to the market.

So amazing. Well, I can't wait to see exactly where Novi goes. I'm. I will be watching keenly from the sidelines and looking at all the amazing work you're doing. Yashi, thank you so much for coming on the podcast today. If people want to learn more about Novi and maybe even subscribe, where can they go?

Yep, you can go to novi connect.com that's where you can find a lot more information about what we do. You can also always email me directly. I'm happy to connect you to whatever your needs are and hear about that and share more about the platform. But yeah, www.noviconnect.com is where you'll find information.

Awesome. Thank you so much for coming on the podcast today. It's been a pleasure talking to you.

Thank you, Lauren. Thanks for having me.

I hope you enjoyed this episode and I would love to hear your thoughts. Are you a formulator wondering how you can learn more about the origin of your cosmetic ingredients? Are you a brand owner wondering how you can meet all of these standards in the marketplace? Are you a beauty shopper feeling overwhelmed by certification schemes? Please do come and leave us a comment on our social channels as both the Formula Botanica team and I love hearing from you. Thank you for joining Yashi and I for this latest episode of Green Beauty Conversations. I really hope you enjoyed it. If you did, please do leave us a five star review so that other people can enjoy these conversations too. Make sure you subscribe to our podcast on Apple Podcasts or Spotify or whatever your favorite podcast app is and stay tuned for the next episode. Follow Formula Botanicaormula Botanica on Facebook, Instagram, YouTube, TikTok, Twitter or LinkedIn. Visit our website at formulabotanica.com and sign up for our free online formulation course today.