Back in 2013, she started a makeup line called em Michelle Phan, in partnership with the beauty giant L'Oreal. The line got a poor reception online--in large part regarding the high prices of the products--and she ultimately severed ties with L'Oreal. "I really want to give a nicer review, but everything seems so bad from em cosmetics," wrote one incensed customer. "It applies like cheap makeup. For a not very cheap price."
That failure sunk Phan into depression, she admitted to Racked this week. At the same time last year that she was gracing the covers of national magazines--including Inc.--Phan stopped posting to her YouTube channel, prompting some followers to worry that she'd died. "I was waking up feeling so broken," Phan says. "I didn't know why."
It wasn't the first time the 30-year-old had suffered from depression. As the daughter of impoverished Vietnamese immigrants, she experienced the pain of growing up on food stamps and being bullied in middle school. In search of friendship and comfort, Phan turned to the Web: "It was an outlet to create a different facet of who I was," she told Inc. last year. "A girl that I wanted to be--confident--not who I really was."
So it's perhaps not surprising that, once again, Phan is bouncing back by returning to her favorite place: The Internet. On April 17, she's re-launching em by herself, with products initially available only through her company's website. She's also developed a more minimalist aesthetic--selling only two product categories, liquid eyeliners and lipsticks--based on what her fans said they wanted in comments on a YouTube post.
For any entrepreneur, the difference between success and failure often comes down to control. "I had no control in the business strategy," Phan said a year ago of the conditions surrounding em's first launch. "How can you expect to grow a business if you can't move?" Large companies, she said, tend to use "old paradigm" ways. "In general, you have so many people who work separately and are all compartmentalized. There's no flow where you can have open dialogue and communication."
Phan also appears to have learned from her strategy mistakes. This time, as opposed to offering hundreds of products, she's starting with 10. And they'll be priced around $15, as opposed to as high as $75.
Time will tell if the new version of Em will fare better than the first. But if Phan's profitable beauty sampling service, reportedly valued at $800 million, is any indication, she stands a better chance of succeeding on her own.