The 20-year overnight success: Adore Beauty’s Kate Morris

We caught up with Kate to talk about her journey from starting Adore Beauty in her garage to her recent IPO, which has gone down in the history books as being the largest Australian IPO by a female founder.

When you launched Adore Beauty in 1999, you were years ahead of the game. Do you think you realised that at the time?  
Well, that’s one way of putting it! When I launched Adore Beauty it was because it just seemed like a no-brainer. I was a student and working on the Clarins counter and could see that while Australia was behind when it came to online shopping, someone was going to have to be the first to do it. From that point I couldn’t shake the idea, it was like a brain worm, and I knew that person was going to have to be me. 

Once you made the decision to go for it were you nervous? What was the first thing you did to get things started?
I can't remember the very first thing, but it was probably working out a business plan. I had no idea how to write one and so would have to go to the library and borrow books on writing a business plan. Ironic really because I was doing a business degree at the time, they don’t teach you that part! I discovered that first business plan just the other day, and it’s surprising how relevant it still is even though it's 20 years old. I found that quite spooky. 

So, after the business plan what came next?
A website, and that wasn’t as easy as it is now. I remember looking through adverts in The Age for companies who could build me a website. I phoned a bunch of them to talk about my ideas and then had to work out how much I needed to borrow to create the website and buy the products. And then I went and pitched my boyfriend’s dad, who was going to lend me the money. 

Did you approach any banks at that stage?
I did talk to banks but the response I got as a 21-year old student who wanted to start Australia’s first internet beauty store was mortifying. They just looked at me like I was a crazy person.

At the point did you want to give up or were you still 100% all in on the idea?
I think that the fact that I had no idea what I was in for played in my favour. I was young and naïve, and I just thought, I can do this. I didn’t have any fear about failing because my parents were, and still are, so supportive. And I thought, well, what’s the worst thing that could happen? If it didn’t work, I would’ve owed my boyfriend’s dad $12,000 and had to get a job to pay it back. I remember asking myself ‘can I live with that?’ and I realised that yes, I could! 

I find it so interesting because if you were starting Adore in 2020 it would probably start life as a side hustle but that concept just didn’t exist…
Look, it was easier for me. I was 22, I didn't have any kids and aside from the fact that I was completely naïve and clueless it wasn’t a bad time to start a business.

I do think it’s difficult to make a real success out of something that's only a side hustle. I think at some point you have to make a choice. What do you want?

Do you want it to only ever be a side hustle, which is also perfectly fine, but there’s a saying we had in Launceston, which is ‘go hard or go home’. At some point you have to make that call. Are you all in or not? 

I think the risk factor can be quite paralysing for people…
Yes, and it can involve tremendous personal risk. And I think it pretty much always does. You know, I’ve seen a number of pitch decks where founders are asking for $150,000 a year to pay themselves. It always makes me want to say to them, where’s the sacrifice? You’ve got to want this bad enough to live on next to nothing. You’ve got to be willing to make a personal sacrifice, founding a company isn’t always a comfortable path. 

So, back in 1999 there was no social media and content was limited to print and print advertising. How did you find your customer? I bet it taught you a lot about the hustle. 
It taught me so much about the hustle! I think the thing that it did, and it’s something that continues to stand us in very good stead, was that it taught me that the customer experience needed to be good. I needed to be able to get word of mouth recommendations, and the kind where people would actually tell a friend about us. So, I focused on that as being something that was really core to our marketing. It’s where the tradition of putting a Tim Tam into every order came from. I was looking for something I could do to make the experience of getting an Adore Beauty parcel fun for every customer.  

As Adore Beauty has grown has it been an easy transition for you from that startup mentality to now having 200 employees? 
It’s been a gradual process. My co-founder joined me a couple of years into the business so there was just the two of us for the next two years and then, four years after I started, we made our first hire. That was staff member number one and they came in to help us with customer emails, then we hired more people to help us pack orders and it’s been a slow and continual process ever since.

I remember reading that you had a point where you just thought, Oh, I don’t know that I’m actually enjoying this anymore. Why was that and what kept you going?
Back then I was always very conscious of my lack of experience and I’d obviously never run a company bigger than Adore Beauty was at the time.  I started to wonder if I should sell or if I should bring someone in to run it. So, I went to see a business coach and she got me and my business partner to write letters to ourselves 10 years in the future. It sounded like a woo-woo idea at the time, but we did it and it helped turn the lights back on for me. I could see that I actually did know what to do and what I wanted and that it would involve having to raise capital. We came out with a much clearer idea of where we were going and how we were going to get there. It's safe to say that we’ve surpassed those future goals!  If you’d said to me back then that we’d be where we are now, I don’t know if I would have believed it. 

Do you think that you wouldn’t have dreamt that big?
Yes, to be honest, and I think this is a way we let women down. We encourage them to think in terms of what’s achievable and that keeps things small. I’m glad that we’ve been able to show women business owners who are slogging away what’s possible. I just hope it doesn’t take the next one 20 years to achieve a big IPO. I would also say that there’s not a great deal of early startup support for consumer or retail businesses because everything’s geared around software and pure tech. There are a lot of great companies being overlooked. I think there should be clearer pathways so people know exactly where they need to go to raise money. 

What would be your one piece of advice for women who are starting out?
Network like hell. I was very reticent to do it but realised I was holding myself back, so for two years I went to every event I could find. I hated doing it sometimes and would get really nervous and would make deals with myself, like, okay you only have to go for an hour. Or, you can leave after you’ve spoken to five people. I would force myself to do it. 

Did networking help you with Adore Beauty?
100%. I also think that networking gives you the opportunity to put good energy out there. You can go to an event and meet someone really interesting or you might end up helping someone out. It’s not always about what you can get. Be brave, get out there, meet people and make things happen. No one else is going to do it for you. 

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Kate will be sharing more of her story at Atto Accelerator’s upcoming Demo Day 2020. Register to attend the virtual event here.