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Startup Spotlight: The Honest Company

With a Hollywood name as a co-founder, how have they fared?

25Sep

In 2011, actress Jessica Alba founded the Honest Company. She was inspired to create a non-toxic consumer goods company after a clothes detergent caused her child to break out in welts. Four years on, the startup’s now worth an estimated $1.7 billion, and for the most part, has been positively received for its charitable mission and the quality of its products.

Since day one, the company’s been battling with the misconception that ‘natural’ products are less effective than those which use chemicals. An article in Fast Company stated that despite the effectiveness of the company’s baby wipes, people were put off by their appearance and feel, as they were thinner and more transparent than their chemical-laden alternatives.

To counteract this, the Honest Company has purposefully made their products as aesthetically similar to that of their rivals as they can. The Honest Company’s co-founder, Sean Kane, stated that: ‘Even though the wipe was extremely well received, we went back and revised’ and that the baby wipes are now ’probably the thickest, most effective wipe on the market today.’

Despite the company’s valuation, it hasn’t all been plane sailing. When Jessica Alba and Sean King named their first venture ‘The Honesty Company’ they must have known that they’d be opening themselves up for ridicule if it was accused of doing anything dishonest.

That’s exactly what happened this September, with a lawsuit demanding damages of $5 million after the plaintiff felt that the company was misleading its customers by calling their products completely natural. According to legal documents attained by People, a number of the company’s products contain ‘unnatural’ and ‘synthetic’ ingredients and that its sunscreen is ‘ineffective’.

Jessica Alba’s already addressed the allegations, blasting them as ‘baseless and without merit’. But there have been a number of complaints about their ‘SPF 30 sunscreen’ which, according to a number of consumers, failed to protect them from the sun. These allegations are central to the current court case, and are particularly damming for startup’s reputation.

While selling sunscreen that fails to protect its customers from harmful UV rays is clearly a prosecutable offence, the FDA doesn’t actually regulate the use of the word ‘natural’. This will strengthen the Honest Company’s position in the case, that is unless they’ve actually been labelling their products with the wrong ingredients.

Even if the case goes against the Honest Company, it’s unlikely to constitute much more than a small hurdle. The company’s product line has expanded to 120 items, and Alba was recently on the cover of Forbes magazine’s ‘America's Richest Self-Made Women’ edition. They also recently raised another $100 million of funding, which will go into both their marketing efforts, and improving their current products.

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