The Myth of “Science-Backed” Brands

In beauty and skincare, “science-backed” has become one of the most overused phrases in the market.

For founders, it feels like a clear differentiator. Stronger formulations, clinical trials, and scientific rigor should lead to a more valuable business.

But when you look at how acquirers evaluate brands, the reality is very different.

Science is rarely the reason a company gets acquired.

What Buyers Actually Care About

According to Dr. Liia Ramachandra, the first metric an investor or acquirer should look at is simple:

Repeat purchase rate.

Not ingredients.

Not clinical studies.

Not marketing claims.

If customers are not coming back, the product is not working in the only way that matters.

A brand with strong repeat behavior signals:

• Product-market fit
• Customer trust
• Sustainable revenue
• Lower acquisition costs over time

These are the drivers of valuation.

Everything else is secondary.

The Reality of Clinical Trials in Skincare

Many founders assume that running clinical trials creates defensibility.

But most skincare trials are limited in scope.

They are often:

• Conducted on 20 to 30 participants
• Based on subjective feedback
• Focused on short-term outcomes

These studies can support marketing claims, but they do not create a meaningful moat.

In contrast, pharmaceutical-grade trials require significantly more rigor, cost, and regulatory oversight.

The gap between the two is substantial.

Why Differentiation Always Erodes

One of the biggest risks in building a brand around a single idea is that the market catches up.

This has already happened in categories like:

• Clean beauty
• Sustainability
• Gluten-free formulations

What was once a unique positioning becomes table stakes.

Founders who fail to evolve get left behind.

The key is to continuously reassess:

• Who your customer is today
• What they care about now
• How your product fits into their life

Brands that grow with their customers maintain relevance.

How to Allocate Capital as a Founder

One of the most practical insights from this conversation is how founders should think about spending.

In the early stages:

• 100 percent of capital should go into R&D and product validation

After product-market fit:

• Shift heavily toward marketing and customer acquisition

A useful framework:

• ~5 percent toward R&D
• ~25 percent toward marketing

The goal is not to endlessly improve the product.

It is to get the product into more hands.

The Role of Regulation and Trust

With the introduction of MoCRA, the baseline for product safety has increased.

Brands now need:

• Stability testing
• Safety validation
• FDA registration

Additionally, platforms like Amazon and TikTok Shop have become de facto gatekeepers.

If a product is sold through these channels, it has likely met a minimum threshold of compliance.

This creates a new layer of trust for consumers and investors alike.

When Skincare Becomes Medicine

There is a growing overlap between skincare and pharmaceuticals.

New ingredients and peptides can deliver powerful results.

But with increased efficacy comes increased risk.

In some cases, highly potent compounds may:

• Require supervision
• Carry unintended side effects
• Be unsuitable for daily consumer use

This creates a natural boundary.

Consumers expect skincare to be safe above all else.

Effectiveness matters, but not at the expense of safety.

The Shift Back to Science

The industry is currently moving away from “natural” and back toward precision.

Consumers are becoming more educated.

They are asking:

• What type of vitamin C is this?
• What molecular weight is used?
• What concentration is included?

This shift favors brands that can clearly explain their formulations.

But again, this is not the primary driver of value.

It is simply part of the foundation.

The Real Takeaway for Founders

If you are building a beauty or consumer brand with an eye toward exit, the priority is clear:

Focus on repeat behavior.

Science helps you build a good product.

But customer love builds a valuable business.

The brands that win are not the most scientifically advanced.

They are the ones customers cannot stop buying.