Selena Gomez is a billionaire, thanks to her beauty brand

NEW YORK – In the new season of American television series Only Murders In The Building (2021 to present), the main characters’ hit podcast is being turned into a movie.

In real life, lead actress Selena Gomez is building her own, much bigger, empire. 

The 32-year-old rose to fame as a kid on the Disney Channel, started a music career, created her own beauty brand and is now starring on the Emmy-nominated Hulu show. In the process, she has built a fortune that has made her one of the youngest female self-made billionaires in the United States.

The actress, singer and entrepreneur is worth US$1.3 billion (S$1.7 billion), according to the Bloomberg Billionaires Index, which is ranking her for the first time.

Unlike her close friend, American singer-songwriter Taylor Swift – who has reached billionaire status largely from her music and touring – Gomez has become wealthy from a mix of businesses that leverage her talent and hundreds of millions of social media followers. 

“Selena is not just a pop star,” said Ms Stacy Jones, founder and chief executive officer of Hollywood Branded, a Los Angeles-based branding agency. “She’s a multifaceted businesswoman with diverse income streams contributing to her impressive net worth.”

The vast bulk of her wealth is tied to Rare Beauty Brands, the make-up line she started in 2019 and has become a hit with influencers and cosmetics-obsessed teens. But she also has brand partnerships, acting deals and a mental-health start-up, an array that should help ensure wealth longevity should she decide to stay away from the public eye. 

Mr Brent Saunders, chief executive of eye-health company Bausch + Lomb and an investor in Gomez’s Wondermind start-up, said there is a key factor for her success: authenticity. 

“You’ve got a real role model of how a celebrity can use their influence and expertise to do good and create good business,” he said. “Selena epitomises that.”  

Representatives for Gomez did not respond to requests for comment.

Bloomberg’s wealth analysis took into account the estimated value of her stake in Rare Beauty, her interest in Wondermind, the estimated value of her music album sales and properties, and earnings from streaming deals, brand partnerships, concert tickets and acting.

It assumes the lowest estimated value of her stakes in businesses and is based only on assets that could be confirmed or traced from publicly disclosed figures. 

Child star

As a child, Gomez got her start in the spotlight as part of the cast of American children’s TV series Barney & Friends (1992 to 2010). She moved on to star as Alex Russo in the Disney Channel’s Wizards Of Waverly Place from 2007 to 2012. It turned into a hit that earned the then teenaged Gomez around US$3 million in total. 

But she really blew up into the public eye after starting a music career, first with the pop-rock band Selena Gomez & The Scene and then as a solo artiste. With three studio albums and 44 singles, she won the American Music Award for favourite pop/rock female artiste in 2016, and was nominated for two Grammy awards.

Her acting career continued to grow as well, with roles in movies such as Spring Breakers (2012) and A Rainy Day In New York (2019). 

In the process, Gomez generated huge success on social media. With 424 million followers, she is behind only soccer legends Cristiano Ronaldo and Lionel Messi as the most popular person on Instagram.

That made her powerful enough not just to promote her brand, but those of big names such as Puma, which signed her to a two year-deal worth a reported US$30 million in 2017. Gomez also earned US$10 million when she was tapped as Coach’s face in 2016, and had a US$10 million agreement with Louis Vuitton. 

While music has made her particularly popular, it is a relatively small source of her wealth. Unlike Swift, Gomez is not known as a songwriter and is paid mostly for performance royalties. She would potentially double her music earnings if she wrote her own songs, said Ms Jones. Music tours accounted for only less than 5 per cent of her wealth, with album and record sales less than 2 per cent. She has not toured since 2016, when she cancelled her Revival tour after 55 shows, citing mental health struggles. Still, the tour had more than US$30 million in ticket sales.

“It’s smart that she’s kind of created a career that’s not so dependent on music being a big part of the financial piece,” said Dr Carolyn Sloane, a professor at University of Chicago’s Harris School of Public Policy.  

Rare success

Most of her fortune – roughly US$1.1 billion – comes from her stake in Rare Beauty, which she has kept largely independent.

The only known investors in her beauty brand are Nikki Eslami’s New Theory Ventures and chief executive Scott Friedman, who previously led Nyx Cosmetics and sold it to L’Oreal for US$500 million in 2014. The Bloomberg analysis assumes Gomez holds a 51 per cent majority interest based on her founding role in the company.

In March, Bloomberg reported that Gomez hired advisers to weigh selling Rare Beauty at a US$2 billion valuation, though she later told Time magazine that she has no plans to sell.

Gomez and her team marketed the brand as simple, moderately priced make-up. In a 2023 radio interview, she said: “I wanted the products to be great, and I also wanted the message to be that make-up is meant to be fun.”

Gomez used her own influence to create social media buzz for the products.

In the early months following Rare’s launch, she recorded hours of herself doing her make-up for one of her TV shows, the Max cooking series Selena + Chef (2020 to 2023). Her team then cut those sessions down to clips that often last no longer than a minute. Other snippets feature Gomez on TikTok with commentary about Rare’s products.

Rare’s annual revenue reached US$350 million in 2023, according to data provider Pitchbook, topping celebrity-founded brands such as US actress Jessica Alba’s Honest and Haus Labs by singer Lady Gaga.

Gomez, who has been open about her struggles with bipolar disorder, pledges to donate 1 per cent of all Rare Beauty sales to the Rare Impact Fund for mental health service and education. That type of “worthy cause” makes it even more appealing for fans to support the business, Ms Jones said.  

“I have a lot of respect for what Selena and her team built with Rare Beauty Group over a short time,” said Mr Saunders, the Wondermind investor. The combination of celebrity backing, a cause-based mission and quality products is “a really good mix for success”, he said.

When Mr Saunders met Gomez for the first time to talk about investing in Wondermind at private club Zero Bond in New York, he said it did not feel like a business pitch. “I wasn’t asking for projections or return on investment. We really talked about bringing more awareness and making people feel they are not alone.” 

Gomez co-founded the Wondermind start-up with her mother, Hollywood producer Mandy Teefey, and Ms Daniella Pierson, founder of pop culture newsletter The Newsette. The platform – which includes mental-health tools, interviews and a newsletter – was valued at US$100 million in 2022. It attracted investments from Lightspeed Venture Partners, Sequoia Capital and tennis icon Serena Williams’s venture fund, Serena Ventures.

Gomez is now in focus for her turn as Mabel Mora on Only Murders In The Building, which co-stars Steve Martin and Martin Short and started its fourth season on Aug 27. She takes home at least US$6 million a season from the show and is up for an Emmy award for lead actress in a comedy series later in September.

The star has not disclosed specific plans on her music and new shows, but she expressed her inclination towards acting on a January episode of the SmartLess podcast. “I do feel like I have one more album in me,” she said. “But I would probably choose acting.”

As for Rare Beauty, high valuations might be transitory and celebrity attachment is no guarantee of a forever hit. Consumers can be fickle, and lots of brands tied to famous people have fizzled after a strong start.

In 2023, US actress Kristen Bell shut down her skincare line. Sephora stopped selling the brands of TikTok celebrities Addison Rae and Hyram Yarbro. US singer Ariana Grande paid US$15 million to buy the physical assets of her company, r.e.m. beauty, from Forma Brands, whose big bet on celebrity influencers soured and pushed it into bankruptcy. 

For Gomez, diversifying her business into multiple avenues might prepare her better for later years, said Dr Sloane.

“What she’s doing is pretty smart,” she said. “There has been this big shift throughout her career towards what fits her more authentically, which turns out to be better investment decisions.” BLOOMBERG