Sometimes the ex-CEO is exactly what a brand needs for a fresh start. 

That's exactly what happened at Tatcha with Victoria Tsai, the founder and CEO of the Japanese-inspired skin care line. After spending close to a decade building the premium beauty brand from the ground up, Tsai had stepped aside. The company had been acquired by Unilever in a blockbuster $500 million sale in 2019 and seemed to be headed in a new direction.

When asked to return to the chief executive role in January, she turned to the writings of other boomerang CEOs such as Steve Jobs and Michael Dell. She read Onward: How Starbucks Fought for Its Life Without Losing Its Soul, by Starbucks CEO Howard Schultz with Joanne Gordon (Rodale, 2011), which details the steps that former CEOs who return to companies must take to transform an organization. She noticed a recurring theme.

"When you go from small to bigger, it's so easy to lose your sense of focus and purpose and mission," says Tsai, who had worked at Starbucks earlier in her career. "I think most founders who step in as second-time CEOs, we tend to have had the same experience, which is that thing that made your company so special, that magic, that way of being, that mission. Sometimes when you bring in outside leaders, it doesn't always translate and stick."

Tatcha is among the Inc. 5000 alumni companies, having ranked at No. 21 in 2015. Tsai spoke to Inc. assistant editor Brit Morse during an Inc. Real Talk stream event about the lessons she is learning the second time around at the helm of her business. 

Build for longevity

For Tsai, sitting on the sidelines and watching her company be run by others reinforced what her goals were for the brand. She wanted a company that loved its clients and built the best collection in the world for them. What's more, she wanted a company that could last for 100 years and outlive her. 

While Tsai regrets stepping down, she says she learned a lot from the experience. That a company she spent nine years building could fall apart so fast under new leadership was a "wake-up call" of sorts. 

"It's kind of like building a house when an earthquake comes. If it's well built, it shouldn't be able to fall down," she says. "Watching the cracks in the foundation and the peat chipping off the wall a little bit from the sidelines helped me realize as a leader, if I want this to last 100 years but I can't be the leader for 100 years, where do I need to reinforce the foundations of the company, so that it is built to last?" 

Tsai ended up hiring an organization design firm to do assessments of Tatcha and interview people throughout the company. She then did what she called a "three-week listening tour," where she spoke to every single Tatcha employee. 

"I said, 'Tell me what's going right, that you want to make sure I protect, and then what needs to be changed.' And that became my marching orders for coming back in," she says.

Differentiate your products

Tatcha doesn't try to keep up with the latest skin care trends. Part of this is due to the sheer amount of time the company takes to research and develop each product. The brand's signature sunscreen, for example, took four years to create. But if a soon-to-be-released product seems to coincidentally align with a new beauty fad, Tsai nips it in the bud. 

"If somebody else is already doing it, then I'm not focusing or differentiated. And if it's trendy, it's not differentiated. So, no, I'll kill it," says Tsai. The founder estimates that she kills or shelves roughly 30 percent of what the company is working on. 

"There's no point in launching something that somebody else has already done," says Tsai.