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February 6, 2025 • 31min
Disrupting the hair color business, with Madison Reed CEO Amy Errett
Masters of Scale
Amy Errett is the founder and CEO of Madison Reed, a hair color brand focused on clean ingredients and innovative technology. After getting fired from her previous role, she leveraged her VC experience and market insights to build a company that has served over 5 million customers since 2013. This episode explores her journey of building and scaling Madison Reed while maintaining a strong company culture and mission-driven focus.
Disrupting the hair color business, with Madison Reed CEO Amy Errett
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Key Takeaways
- Finding Your Genius - Understanding your strengths and weaknesses is crucial for entrepreneurial success. For Amy Errett, getting fired led her to realize she wasn't suited to working for others but excelled at building teams and solving complex problems
- Market Opportunity Recognition - Hair color emerged as a massive addressable market with high repeat purchase rates and limited online competition in 2013
- Product Development - Madison Reed focused on creating hair color products with clean ingredients and innovative technology for color matching
- Culture & Values - The company operates on five core values: love, trust, responsibility, courage and joy, reinforced through consistent traditions and actions
- Mission-Driven Business - Beyond serving customers and shareholders, Madison Reed aims to empower women, particularly colorists, by providing living wages and benefits
- Strategic Growth - The company has raised $240M, scaled to $200M in revenue, and successfully navigated omnichannel distribution and pandemic challenges
Introduction
Amy Errett is the founder and CEO of Madison Reed, a hair color brand focused on clean ingredients and innovative technology. After getting fired from her previous role, she leveraged her VC experience and market insights to build a company that has served over 5 million customers since 2013. This episode explores her journey of building and scaling Madison Reed while maintaining a strong company culture and mission-driven focus.
Topics Discussed
The Origin Story (3:48)
After getting fired from her role at Maveron, Amy went through therapy to understand herself better and realized key insights about her strengths:
- Self-awareness about not being suited to working for others
- Natural inclination toward solving complex problems and building teams
- Recognition of the importance of having a mission and purpose
- Understanding the value of team dynamics in achieving impossible goals
Market Opportunity & Research (9:21)
The inspiration for Madison Reed came from an unexpected source:
- After passing on Dollar Shave Club while at Maveron, Amy had an intern research women's analogs to shaving
- Hair color emerged as the top opportunity with huge, repetitive market potential
- Personal connection through wife Claire's experience with early graying and ingredient concerns
- Initial market validation came from L'Oreal executive interest and support
Product Development Journey (13:42)
The journey to create Madison Reed's first products involved significant challenges:
- Manufacturing Partnership required visiting 13 facilities in Italy before finding the right partner
- Initial Investment of $80,000 of personal funds for first production run
- Product Testing with 19 different shades on real customers
- Learning Experience from both successes and failures in early testing
Early Business Challenges (19:09)
Amy identified several key lessons from early business challenges:
- Co-founder dynamics - Having too many co-founders (4) created complications
- Technical expertise gap - Lack of technical co-founder cost 18-24 months of progress
- Leadership learning - Understanding the importance of both strategic and tactical capabilities
- Self-awareness about blind spots and decision-making patterns
Fundraising Experience (22:18)
Madison Reed's fundraising journey was relatively smooth due to several factors:
- VC Background provided advantages in understanding process and players
- Market Timing aligned with D2C explosion
- Product Validation through early testing and demonstrations
- Strategic Approach to investor education about market opportunity
- Total funding raised: $240 million
Pandemic Response & Growth (24:44)
The company successfully navigated the COVID-19 pandemic:
- Sales Surge - Selling one box of color every 5 seconds during peak
- Channel Adaptation - Pivoting from retail to online sales
- Culture Maintenance through consistent traditions and communication
- Strategic Analysis partnership with Bain to understand evolving customer base
Company Culture & Values (25:06)
Amy emphasizes the importance of authentic company culture:
- Core Values: Love, Trust, Responsibility, Courage, and Joy
- Weekly Traditions including mandatory company lunches every Wednesday
- Employee Focus on seeing and valuing team members' contributions
- Transparency in leadership, including admitting mistakes
Social Mission & Impact (27:07)
Madison Reed maintains a strong focus on social impact:
- Employee Empowerment - Providing living wages and benefits to colorists
- Career Development opportunities for women and people of color
- Three-Customer Focus: product customers, investors, and team members
- Authentic Leadership through transparency and accountability
Strategic Growth & Future (30:28)
The company's growth strategy includes:
- Current Scale: $200 million in revenue with 20%+ annual growth
- Customer Segmentation insights driving expansion strategy
- Omnichannel Approach combining online and retail presence
- Innovation Focus on convenience and customer experience
Conclusion
Amy Errett's journey with Madison Reed demonstrates the power of combining market opportunity with mission-driven leadership. Her focus on building strong company culture while driving innovation in the hair color industry has resulted in significant scale and impact. The company's success stems from its ability to balance business growth with employee empowerment and customer satisfaction, all while maintaining authentic leadership and clear values.
