Selena Gomez: how she became a self-made billionaire

Jana Hlistova

Sep 08, 2024

Transcript

Welcome to our #252 weekly newsletter.

“For women taking control of their financial future”

-Jana Hlistova

From The Purse

In this week’s newsletter, we spotlight Selena Gomez and how she has grown her successful business empire and her personal wealth to billionaire status.

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And you can review the news in brief so you stay on top of global financial, economic and investing trends.

I hope you enjoy this week’s newsletter.

Until next week,

Jana

Selena Gomez: how she became a self-made billionaire

Selena Gomez is worth $1.3bn, according to the Bloomberg Billionaires Index, a first time ranking, as reported by Bloomberg.

Gomez, who is an actress, singer and entrepreneur, has become wealthy from a mix of businesses that leverage her talent and hundreds of millions of social media followers.

The majority of Gomez’s wealth is linked to Rare Beauty Brands Inc., the cosmetics line she founded five years ago, which has gained immense popularity among influencers and teens.

She has also secured brand partnerships, acting contracts, and a mental health startup Wondermind, creating a diverse portfolio that will help sustain her wealth even if she chooses to step back from the spotlight.

But there is an underlying key component to her success: authenticity.

Selena Gomez combines her ‘influence and expertise to both do good and create good business’.

Social media

With 424m followers, she’s behind only soccer legends Cristiano Ronaldo and Lionel Messi as the most popular person on Instagram.

Her influence has made her a powerful figure, enabling her not only to elevate her own brand but also to collaborate with major names like Puma SE, which signed her to a two-year deal valued at approximately $30m in 2017. Gomez also earned $10m as the face of Coach in 2016 and had a similar $10m agreement with Louis Vuitton.

Rare Beauty cosmetics

Selena Gomez's substantial wealth, estimated at around $1.1bn, primarily stems from her majority stake in Rare Beauty. The brand's only known external investors are Nikki Eslami's New Theory Ventures and CEO Scott Friedman, who has a successful track record in the cosmetics industry. The business generated $350m last year, based on Pitchbook’s data. And Bloomberg's analysis suggests Gomez holds a 51% controlling interest in the company.

As reported by Bloomberg:

“I really tried my hardest to create a product that were beyond just me putting my name on something,” she said in a 2023 radio interview. “I wanted the products to be great, and I also wanted the message to be that makeup is meant to be fun”.

Gomez leveraged her celebrity status to generate social media buzz for Rare Beauty. She created content for platforms like TikTok and incorporated product usage into her other projects, such as her cooking show "Selena + Chef".

Mental health awareness

A key aspect of Rare Beauty's appeal is its commitment to mental health awareness. Gomez, who has been open about her own mental health struggles, pledges 1% of all sales to the Rare Impact Fund, which supports mental health services and education. This philanthropic element has resonated strongly with consumers and contributes to the brand's success.

Wondermind

Gomez co-founded Wondermind with her mother, Hollywood producer Mandy Teefey, and Daniella Pierson, the founder of the newsletter, The Newsette.

The platform includes mental-health tools, interviews and a newsletter was valued at $100m in 2022. It attracted investments from, including Serena Williams’s venture fund, Serena Ventures.

Gomez’s powerful formula

Industry experts praise Gomez's approach: the combination of celebrity endorsement, a mission-driven focus, and quality products creates a powerful formula for success in the beauty industry.

Gomez's strategy of diversifying her business interests and aligning them with her personal values is why she has been able to build such a successful business empire.

Financial news

The Nasdaq 100 plunged 5.9% in worst week since November 2022, S&P 500 dropped 4.3% in worst week since March 2023.
US 10 year yields dropped to their lowest point since Jun 2023 as markets worried about growth following the soft US jobs report.
US jobs data mixed or "could have been worse, but not great". This release more than justifies the Fed going 50bps on the 18 September.
The lender Halifax has reported that the average price of a house sold in August rose to £292,505, the highest since August 2022. That is only £1,000 shy of the record high set in June 2022.
UK state pension to rise by more than £400 a year, say reports. Figures reportedly seen by BBC show men born after 1951 and women after 1953 will get £12,000 in 2025 and 2026.
Nvidia has wiped out $400bn+ in value this week, weighing on key equity benchmarks.

Crypto: bitcoin, ethereum, DeFi

Bitcoin continued to drop this week. Over the past seven days, the price of the asset has descended by more than 9% and—after dipping as low as $52,690 on Friday. Bitcoin is currently trading at $54,400.
Ethereum’s price was hit harder: the coin hit its lowest price of 2024 and ended the week priced at $2,178 after tumbling more than 11%.
Bitcoin and Ethereum ETFs drop to new lows after week of bearish price action.
The price of TON, the cryptocurrency closely associated with the app, is one of the worst-performing coins, having dipped by 14% in seven days. It’s now priced at $4.59.
Magic Eden's multi-chain NFT dominance surges with $60m daily volume amid ME token hype. This resurgence in NFT trading volume on Magic Eden could carry significant implications for the broader crypto ecosystem.
Crypto advocates to rally in Washington D.C. alongside The Chainsmokers for upcoming 'Stand with Crypto Day'.

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We’d love to hear from you. Get in touch with Jana via the The Purse website or tweet @jointhepurse and janicka. We do no provide investment advice. Please do your own research or speak to a financial adviser.