Rejected on Shark Tank, the Lip Bar is now worth millions

BY Preta Peace Namasaba April 9, 2024 4:36 PM EDT
Melissa Butler. Photo credit: The Lip Bar

The business reality show Shark Tank has averaged millions of viewers for over 15 seasons. It is the biggest public platform that an entrepreneur could hope for with a 10-minute pitch on the show having the potential to translate to huge sales. Aspiring entrepreneurs from all over the world get to pitch their business models to a panel of investors and persuade them to invest money in their ideas. Many household names have gotten their start after successfully striking deals on the show.

However, many companies walk away from Shark Tank without securing an investment. When the Lip Bar founder Melissa Butler took her business idea to the show, it was not only rejected by all five judges but also met with disheartening feedback. The vegan-friendly, affordable, and cruelty-free makeup brand persevered and is now worth millions.

A Detroit native, Butler obtained her bachelor’s degree in Business Finance from Florida A&M University and went to work on Wall Street as a licensed stockbroker. While working in finance, she noticed the lack of options in the beauty market for Black women and women of color. Butler was frustrated with the industry and decided to take matters into her own hands. She began creating her own vegan lipsticks from scratch in her kitchen. She made up for what she lacked in industry experience with passion and pure instinct.

“As a woman, I know first hand that how we look often impacts how we feel, and how we feel is often a direct indicator of how well we are able to go out into the world, present ourselves, and accomplish the things we set out to do. Our mission at The Lip Bar was bred from a desire to empower women through beauty,” Butler explained the inspiration behind The Lip Bar.

Butler wanted to create a brand that is inclusive, non-toxic, and easy to use for everyone beyond the common reds and nudes. She launched The Lip Bar with an array of statement shades in blues, greens, purples, and yellows. The vegan brand made bold marketing decisions – casting models with deep tones and putting them in bright-colored lips. Butler wanted to revolutionize the beauty scene and showcase that women with deep skin tones look beautiful in bright colors.

Alongside her business partner, she took her dreams to Shark Tank in 2018. Butler hoped to win the judges over with a mobilized beauty bar and gain capital for her startup. Instead, the sharks gave disheartening feedback. Her idea was rejected by all five judges who referred to it as “colorful cockroaches” and “clown makeup.” She was told that her colorful lipsticks were not marketable and was unable to secure a deal on the show. “The chances that this is a business are practically zero. You only have so many minutes on Earth, don’t waste them trying to sell lipstick,” Kevin O’Leary, one of the judges on Shark Tank said in the episode.

“In business, especially for 10 years, things obviously go wrong every single day. That was just something that went wrong that day. But I understand the view of resilience that lots of people have come to admire about us because we could have stopped going when a group of multimillionaires and billionaires are telling you that your idea won’t work. It takes a lot of courage to look within and say, ‘I’m still going to go after this,’” Butler said about how she overcame the crushing Shark Tank rejection.

The Lip Bar lived on following its Shark Tank appearance. Although the investors harshly rejected Butler’s products, she knew that they were not her target customers. She persevered – navigating challenges while securing success. The Lip Bar leveraged the significant exposure it received from the show to boost its brand recognition and sales. The company continued to expand its product line and distribution channels post-Shark Tank, creating affordable shade-inclusive face makeup that is seamless to apply.

The Lip Bar has reached unprecedented heights over the past decade. It has its own flagship location in downtown Detroit and is available in major retailers such as Target, Meijer, and Walmart. In 2022, Butler raised an oversubscribed $6.7 million fundraising round to further grow the company’s house of brands. Her products have been worn by prominent public figures like Taraji P. Henson and first lady Michelle Obama.

“Shark Tank told me to quit. 10 years and 2 million units sold. Thanks, Mr. Wonderful,” billboards promoting The Lip Bar in Detroit, Atlanta, Houston, Chicago, and  Washington DC declared in 2022.