2025 Community Business Letter

From the Desk of Olamide Ayomikun Olowe, Founder & CEO, Topicals

 

If Topicals Can’t Beat the System, Who Can?

 

Topicals closed 2024 as one of Sephora’s fastest-growing skincare brands, with our Faded Eye Masks being the #1 sold eye product for 18 consecutive months at the retailer. It is a performance metric that speaks to disciplined innovation, strong repeat purchase, and the durability of community-driven brands when fundamentals are sound.

Yet the past year has revealed something undeniable: even with category-leading performance, the operating environment for beauty has grown more challenging for early-stage and culture-led brands. The closures of beloved companies, some of the most innovative in our sector, are not anomalies. They are signals.

Signals that the system is rewarding scale over originality, infrastructure over insight, and capital density over cultural resonance.

At Topicals, we choose not to ignore those signals. We address them with clear-eyed realism and long-term strategy. As an extension of this, I am publishing my first in a series of Community Business Letters: an open conversation about the state of the industry and what’s next for Topicals, addressed to our ultimate stakeholders: our Community.

 

A Clearer Picture of the Current Environment

 

Beauty is having its own “dot-com reset.”

 

In the early 2000s, off the high of the tech boom, the industry crashed, and now, 5 years since the start of the pandemic, the Beauty industry is undergoing a similar reckoning. Not because consumer demand is shrinking. Consumer demand for culture-led brands is at an all-time high, but the infrastructure that supports those brands is aging rapidly.

 

Today the economics look like this:

- Retail margins have increased while payment terms have lengthened

- Working capital requirements for inventory have risen meaningfully

- Paid acquisition has become more volatile and more expensive

- Retailers expect scale on day one

- Investors are prioritizing near-term cost efficiency over long-term growth

- Manufacturers are optimizing their lines for large-volume incumbents.

This environment does not reward experimentation, community-first brand building, or culturally differentiated product development.

It rewards incumbency. It favors old, large, corporate institutions.

In 2000, during the dot com bust, visionary tech founders facing declining stock market prices and business closures believed that stock volatility today had no bearing on long-term potential. And beyond what the 'experts' said, they had a vision for what the future could look like, even though it didn't fully exist yet. The fundamentals mattered; the noise did not. Beauty now faces a similar moment of separation between what looks good and what lasts.

Our commitment at Topicals is to build what lasts. Topicals’ mission has always been to reimagine a world where our community is seen and rewarded for the contributions we've made to culture. Too often, these contributions have been extracted, and the communities that have created the impact have never benefited. 

Nonetheless, Topicals has grown not because it has been easy but because we optimize for longevity over optics.

And yet, even with strong fundamentals the current system requires brands like ours to be nearly flawless. If that’s true for Topicals, it’s even truer for brands with fewer resources.

The recent brand closures underscore this: they were not failures of leadership or product. They were the output of a misaligned system.

 

Culture Is a Non-Negotiable in the Beauty Business

 

When culture-led brands disappear, the loss is not symbolic. It has economic ramifications.

 

These brands:

- Highlight important and often overlooked cultural stories

- Create new category demand

- Introduce inclusive shade ranges and formulations

- Incubate aesthetics that drive industry-wide revenue

- Build customer loyalty that carries over to retailers

 

We are the R&D labs of modern beauty.

But R&D labs cannot exist without the infrastructure to sustain them.

This is not a “Black business” conversation.

This is a small business and culture innovation conversation with disproportionate impact on Black founders.

 

Why Community Business and Building Topicals has Always Been More than Selling Skincare

 

We believe culture is an underpriced asset class. Culture creates outsized value that increases demand, loyalty, and brand power and it typically outperforms competitors who only rely on traditional strategies. Traditional financial metrics don’t fully capture the value of our community because it can’t always be measured numerically.  

But we believe community is a moat.

And through Topicals, we’ve been able to show that community-first innovation can create scale. But without intentional community business building, the structural gap between innovation and scale will be the biggest risk to beauty’s future. 

 

Here’s what I plan to do to close that gap:

- Create open access to business education and brand playbooks

- Develop community-driven distribution strategies

- Design reinvestment loops that recycle resources back into our community

- Encourage behavior that doesn’t force the next generation to reinvent from scratch

If culture drives the industry, then the infrastructure supporting it must be rebuilt. As a step in this direction, I am sharing Topicals Operating Principles because no single founder can out-operate a system built without them in mind. But collectively, we can build a new one.

 

Topicals Operating Principles

 

1. Culture Is a Growth Strategy

We treat culture not as aesthetic, but as a high-return asset class that drives velocity, loyalty, and long-tail relevance.

2. Community Over Virality

We build products and experiences that earn repeat behavior, not just short-term engagement.

3. Operational Excellence Wins

Every lever (inventory, logistics, margin, demand) must be optimized with discipline.

4. Be Prudent With Cash, Extravagant With Creativity

We spend thoughtfully but never constrain the imagination that fuels our brand.

5. Good Product Is Tablestakes, Great Storytelling Is Essential

Narratives are powerful tools for building loyalty and brand love.

6. Earn Trust Through Transparency

With our team, our customers, our retailers, and our investors, clarity is currency.

7. Innovate in Public

We build openly so other founders can learn, iterate, and accelerate without unnecessary barriers.

8. Build for 2035, Operate for 2025

Long-term vision, short-term rigor.

We make decisions based on durability, not immediacy.

9. Excellence Is the Minimum

Because culture-led brands are held to higher scrutiny, we treat excellence as baseline—not aspiration.

10. Protect Culture at the Source

We safeguard the creativity, people, and communities that make our innovation possible.

 

Looking Ahead

 

Topicals will continue to grow with the same discipline that got us here in order to build the infrastructure the next decade requires.

And we will continue speaking honestly about the realities of building in beauty because you can’t manage what you don’t measure.

The cost of doing business is rising.

But the cost of losing culture-driven brands is far greater.

Our commitment is long-term. Our conviction is unchanged.

And the future we are building through Topicals is one where culture and commerce reinforce each other, not compete with each other.

Our customers and our community are our biggest investors and together we can shape the future we want to live in.

If gatekeeping got us here, let open access set us free.

 

— Olamide Ayomikun Olowe

Founder and Chief Executive Officer, Topicals Inc.