Morphe bet the brand on beauty influencers — then the partnerships went sour

Morphe was the defining makeup brand of the influencer era. It grew by attaching its name to beauty's biggest online stars — collaborations with Jeffree Star and James Charles turned its eyeshadow palettes into must-haves, and the brand expanded from brushes and palettes into a portfolio of influencer-linked labels. At its height Morphe was valued at about $2 billion, the centrepiece of a parent company, Forma Brands, that gathered several creator-driven beauty names under one roof.

The strategy that built Morphe also made it fragile. Its sales depended on partnerships with influencers whose own reputations were volatile; when some of those partnerships had to be terminated, the brand lost the very engine that had driven its growth. Court documents cited the company's need to end partnerships with certain influencers as part of what went wrong.

In January 2023 Forma Brands filed for Chapter 11 bankruptcy, carrying around $868 million of funded debt and interest obligations. A week earlier it had closed all of its US Morphe retail stores. Creditors later took over the wholesale business, the online platforms and the international stores for $690 million — a fraction of the valuation the brand had commanded at its peak.

Morphe is a case about building a brand on other people's audiences. Influencer collaborations can make a company famous fast, but they rent attention rather than own it; when the partnerships end — as partnerships with volatile public figures often do — the demand they created can disappear with them.

Rented attention from volatile influencers instead of owning demand; when partnerships ended, sales collapsed, leading to Chapter 11 with ~$868M debt and stores closed.

Morphe built its growth on collaborations with beauty influencers such as Jeffree Star and James Charles, betting the brand on their audiences.

Those partnerships were volatile, and the company eventually had to terminate some of them — removing the engine of its growth.

The parent, Forma Brands, carried around $868 million of funded debt and interest obligations against a portfolio of creator-driven brands.

In January 2023 Forma Brands filed for Chapter 11 and closed all US Morphe stores; creditors later acquired the business for $690 million, far below its ~$2 billion peak valuation.

A brand built on other people's audiences stands on rented ground. Morphe rose on influencer collabs and fell when it had to end them — the partnerships that made it became liabilities.

Morphe's brands and operations were bought out of bankruptcy by their lenders and have continued on a smaller footing, and the company has since reported a recovery in sales. But the collapse of Forma Brands remains the cautionary tale of the influencer-beauty boom: a model that could turn a creator's following into a billion-dollar valuation could not, in the end, survive the moment the creators stopped selling for it.