What Big Companies Can Learn from Breakout Brands

When Nir Liberboim and his cofounders launched Lemme, a US-based women’s health and supplement brand, they began with a $30 gummy that was priced well above the category average, and they sold it through a few retailers and direct to consumers. Within four years, Lemme had passed $200 million in sales, yet its brand awareness among US consumers remained under 10%. That combination was impossible under the old model, where scale followed years of expensive brand building.

Stories like this are no longer rare. And they raise the question that we set out to answer: What have these founders learned about scaling a brand that the largest companies can use? We call the mismatch between how brands are currently built and what large companies are built to do the scaling gap.

It shows up at both ends of a portfolio. Large brands lose share because the systems are built to defend rather than reinvent them, and midsize brands stall because they are too big to fly under the radar and too small to command the attention of a large company’s branding machines.

The takeaway is not that multinationals should behave like startups, but that building a scaling muscle is learnable. Startups do it because they have no alternative—but large companies can as well.

Sizing the Opportunity

To understand what works when scaling a brand and what doesn’t, we interviewed CEOs and founders of breakout brands. We also drew on our work with some of the fastest-growing consumer brands and their investors, as well as conversations with analysts and executives. The leaders we interviewed manage companies that span categories, business models, and stages of growth.

“It’s relatively easy to start a brand today,” says Neda Daneshzadeh, cofounder of the growth investor Prelude Growth Partners. “The barriers to entry are as low as ever. Retailers are there. Amazon is there. Marketing is there.” A founder can outsource almost every function and reach the shelf needing little of the infrastructure that the industry once demanded.

Already a top seller on Amazon, Boka entered Walmart and Target in 2025 with two SKUs of toothpaste and beat buyer expectations. Othership turned a backyard ice bath into a chain of bathhouses across two countries. Happy LLC, a coffee brand, reached 12,000 retail outlets and 60,000 placements of its various products at those outlets in the first two years after its launch. None of these startups could outspend the incumbents. Each adopted the same nontraditional logic: start with a real consumer need, and then build demand through word of mouth and creators who generate social content, rather than through paid media.

The clearest casualties are midsize brands, and scaling them is what multinationals, for all their mastery of growth, find hardest. According to NielsenIQ data, US consumer packaged goods (CPG) manufacturers that earned less than $1 billion in measured retail sales generated the majority of category growth.

The builders of breakout brands resist the industry’s vocabulary. “No human being has ever said, ‘Next time you are shopping, can you get me some of those challenger products?’” says Craig Dubitsky, who founded Hello Products, sold it to Colgate-Palmolive, and now runs the coffee brand Happy. “The only people who ever called us a challenger or disruptive were the companies and brands that were being disrupted. We ended up being disruptive because we were delighting people more.”

Understanding how breakout brands grow is the first step to reigniting big CPG companies’ stalled brand-building momentum. The path to scale itself has changed. Under the old model, brands typically built broad awareness and distribution before reaching meaningful scale. Today, digital marketplaces, creators, specialty retail, social commerce, and increasingly, AI-powered discovery allow brands to aggregate pockets of intense consumer demand before achieving mass awareness. As these pockets connect and compound, meaningful scale can arrive much earlier than the traditional model would predict.

Nothing breakout brands do is beyond a large company’s ability, only beyond its current design, and design can be changed.

Why Scaling Works Differently Inside a Multinational

The scaling gap is not about talent or foresight. “You have smart people everywhere who can pick up trends,” notes Pierre Poignant, cofounder and CEO of Essor. The difference is structural: large organizations are built to protect what works, and four features of that model make it hard to reinvent a large brand or scale a new one.

The first is risk asymmetry. Incentives reward the stewardship of proven brands. So, a small bet that succeeds is immaterial while one that fails is significant, and the typical tenure of an executive rarely accommodates a durable bet.

The second is materiality. A new brand is too small to command the attention of senior leaders for years. This drives a preference for M&A, and transaction and overhead costs pull acquirers toward brands that have already proved their business model. Recent deals follow the pattern: Grüns, the greens-based gummy supplement brand, and rhode, Hailey Bieber’s skin care line, each sold for about a billion dollars.

The third is coordination. Channel, price, and portfolio decisions are all carefully managed inside large CPG companies, creating high levels of internal complexity. By the time the decisions are settled, a fast-moving trend has often passed.

The fourth is ownership. When at scale, a brand is maintained by many functions, so the sharp point of view that defined it early on gets lost. Their work can be flawless by every professional standard, and still a brand may not connect culturally, for example. Poignant has used a practical test: “It checks all the boxes of the MBA marketing course,” he says. “I show it to my daughter, she says it’s cringe.”

Five Lessons from the Trenches

Interviewing CEOs and founders of breakout brands helped us not only to diagnose the gap but also to identify five lessons. None require a startup setting, only the freedom to operate differently. It’s worth noting, however, that each founder chose a large, growing category, so where to play still matters as much as how.

Start with the outcome, not the category. The most successful breakout brands increasingly define their competitive set around a consumer need or outcome rather than an established category. Ingredients and products become delivery systems for that outcome. Ben Witte refused from day one to let Recess be a cannabidiol company, even when CBD was the product. “I’ve never heard anyone call Red Bull a caffeine company. It’s an energy drink company. Similarly, I never thought of Recess as a CBD or magnesium beverage company; we were a relaxation brand,” he says. Marketing to the feeling rather than the formulation let Recess survive the pivot away from CBD and stretch across sparkling waters, mocktails, and powders.

Hello’s Dubitsky, who also built eos and was a founding board member for Method, has used the same principle and applies it to Happy: “We’re not in the coffee business, we’re in the happy business. Coffee is a delivery system.” Boka reframed toothpaste as part of a wellness ritual, rather than a chore. Lemme was not reverse-engineered from category charts at all, says Liberboim. “It wasn’t something we architected. It was a feeling we had.”

Witte supplies the logic: “What is a grocery store? A grocery store is just a collection of value propositions.” He worked on Recess’s name, positioning, and look and feel before a beverage formula existed, judging early success from contact with consumers. “When I launched Recess, the first step and priority was to validate the premise of a relaxation beverage brand and deeply understand the key usage occasions that drove people to drink Recess.”

Most large-company innovation is narrow, pursuing line extensions rather than the white spaces founders go after. Every leader we spoke to started with the need and treats it as the foundation of everything else.

Gain velocity on the shelf, then get distribution. Daneshzadeh sees roughly a thousand brands a year and invests in roughly two. Her screen is simple: an efficient acquisition and durable repeat purchasing. Both must be visible by the time she invests, a step she may take when a company has only $10 million to $20 million in sales. “One side without the other is not enough.” Her operating rule is the one that multinationals often break: “We want velocity to be ahead of distribution,” she says. “And we want velocity in the existing core category to be ahead of expansion.”

This discipline is harder to maintain than it once was. Retailers are hungry for growth and readier than in the past to take on a new brand early and place it in a meaningful number of stores on the strength of its online performance. Scarcity is now a strategy, and founders choose it. Liberboim sequenced Lemme’s distribution for brand building, not volume. He began with the cosmetics retailer Ulta shortly after the launch and then added Target’s beauty aisle and premium duty-free shops. No grocery stores were used for distribution until year four. “If we’re everywhere, it’s hard to get that level of commitment from our retail partners,” Liberboim says.

Restraint paid. Scarcity earned Lemme the premium treatment most new brands never get, including permanent displays and retailer-funded promotion, because a brand that lifts the category’s average price is worth more than one more item on the shelf.

Louisa Serene Schneider applied this lesson in physical retail. She spent two decades in finance before founding the nurse-led ear-piercing brand Rowan. She opened three studios in US markets with nothing in common—Westport, Connecticut, Denver, Colorado, and Alpharetta, Georgia—and all three returned their initial capital within months. Rather than buy impressions she bought location, because a storefront in a top-tier center reaches more people per dollar than a Meta or Google ad. Rowan now runs roughly 115 studios, and many customers still think it is a local brand.

Demand is earned, not bought. Roughly 5,000 creators posted about Boka in the past 18 months despite it paying almost no one for posting. “You don’t pay by the post anymore,” Poignant says, “you have to pay a cut of the sales.” Boka’s social activity generated about a billion views in 2025. Sponsored posts perform poorly because consumers sense the sponsorship.

Celebrity cofounders are often seen as a shortcut in CPG, but the leaders we interviewed were clear that celebrity alone is not enough. Anish Agarwal makes the point about Orebella, fashion model Bella Hadid’s skin parfum brand, which he joined as CEO in 2026 after two decades at large beauty companies. “What other companies typically do is use the founder’s fame to create quick awareness,” he says. “It will get people to try the product once, but it doesn’t create lasting demand.” The brand doesn’t pay megainfluencers’ fees or buy excessive amounts of paid media, leveraging Bella Hadid’s community of 60 million Instagram followers instead, alongside tastemakers, real-life activations, and organic AI discovery.

Rachel Shelowitz, CEO of Saltair, a beauty products brand cofounded by Iskra Lawrence and The Center in 2021, reinforces this. “As the community grows and you’re spending more, efficiency usually drops. Ours hasn’t,” she says. “As the net widens, we supplement spending with connection: store appearances in suburban centers, regional influencer get-togethers, consumer pop-ups. Small groups, real relationships. That’s what keeps the spending efficient as we grow.” The brand is built around its community rather than its founder, and most of that community engages without being aware of Lawrence, so it follows the consumer wherever she is: Discord, TikTok, webinars, or in-person meetups.

Community cannot be manufactured. It forms around a product worth talking about, and no amount of spending holds a community together if the product has not earned it.

Daneshzadeh adds that the next frontier is live social selling, where creators sell in live video streams while viewers buy in the moment, a model that is already popular in China. “Nobody has quite cracked the code,” she says. “I think that will be an incredible unlock for modern brands, because of the authenticity, because of the founders, because of the storytelling.”

Talent comes in two stages. Act one belongs to outsiders. Witte founded Recess having never met anyone who worked in CPG, and he counts that as the reason he could see the space differently. Dubitsky has entered one unfamiliar category after another, which he puts down to curiosity and a lack of preconceptions rather than any rule, and he brings a consistent team with him each time.

Act two is when CPG veterans become necessary. Witte assembled an executive team with experience from the fastest-growing beverage brands of the past five years. Daneshzadeh’s version: Hire ahead of revenue, because “great talent always pays its way quickly.”

Run AI native, not AI curious. The clearest difference between breakout brands and incumbents is how quickly AI gets embedded in their operations. Essor rebuilt its entire supply chain software stack internally in 12 months, replacing almost every purchased product except its data warehouse, because building is now faster than buying. It has abolished the product manager role and embedded engineers in business teams. An autonomous agent surfaces a hundred SEO opportunities every Monday, and every new hire must ship an AI project within three months.

Similarly, Lemme has an AI task force assess every function on a monthly basis. Daneshzadeh describes founders who can now see their costs and margins at a granular level—down to the individual shipping container. “We would never have been able to do that for a sub-$100 million company,” she says.

In our experience, enterprises’ adoption of AI moves slowly, held back by procurement and approval layers and by legacy stacks that every new tool must accommodate. Not every startup we spoke to is on the cutting edge, but the barriers to AI adoption are far lower.

Five Moves That Can Close the Gap for Multinationals

Closing the scaling gap requires taking two initial steps. First, ring-fence the emerging brands. Run midsize and newly acquired brands on a separate operating system—one that has its own governance and culture and that performs at its own speed—and keep brands independent for far longer than feels comfortable.

Second, treat emerging brands as bets. Invest based on early visible signs of repeat purchases and momentum but before the brand’s value is fully priced. A few failures are the cost of the winners. As Dubitsky put it to large organizations, “A brand like Hello should be a farm team. We could take chances that a large organization can’t afford to take, and if we’re right, they can help us move up to the major league.”

Next, make five distinct moves, one for each of the five lessons:

• Put the brand before the margin. Define the brand around the consumer outcome it owns, rather than the category or product it happens to sell today. Assign one owner to be accountable for the soul of each brand, and give them real authority over the product, voice, and channel, as well as the room to spend even when the spreadsheet objects. Lemme committed $100,000 to a single custom gummy mold before the company’s launch and maintains one price across every channel.
• Sequence distribution, don’t chase it. Earn velocity in a few outlets before scaling, hold the price steady rather than shrink the packaging to hit a higher price point, and do not cede the physical theater (such as the permanent and occasion-based displays) that brands are now redefining with retailers.
• Rebuild the demand engine around results. The fastest way to grow is threefold: Reorient marketing spending around social-first, company-owned, and creator channels. Pay creators a cut of the sales, not a fee for posting. And treat AI discovery as the next shelf, earning a place on it by being worthy of recommendations.
• Staff for both acts. Bring in industry outsiders to create and seasoned talent to scale. A core leadership task should be matching each leader’s particular strengths to the plan.
• Go AI native where the stakes are survivable. Use midsize brands as the AI laboratory, implementing fewer layers, forward-deployed builders, agents inside workflows, and a mandate that every team ships its products with guidance from AI. Midsize brands are small enough to transform and large enough to prove the business model.

---

Multinationals still own what large-scale brands require: manufacturing capacity, distribution muscle, and a balance sheet that founders covet. As Dubitsky admits, “The dirty little secret is every little company wishes they were a big company.” But incumbents lack what startups were forced to learn first: how to launch a brand and earn sales velocity. Large companies would do well to heed the lessons of breakout brands.

This is the first of three articles on the scaling gap. The next two will explore how large companies can close the gap on the demand side and the operating side.