Brand valuations soar as top celebs don their entrepreneurial hats

In 2023, Indian A-list celebrities increasingly took on entrepreneurial roles. According to Kroll's latest Celebrity Brand Valuation Report, many top-tier stars have moved beyond their domains and endorsements to co-found or co-own businesses, expanding their revenue streams.

For instance, last year Ranveer Singh became a co-owner of Bold Care, a men’s sexual health brand. Similarly, Sanjay Dutt launched The Glenwalk, his own Scotch whiskey brand. Kareena Kapoor Khan ventured into the skincare market with Quench Botanics, a Korean skincare brand, while Kriti Sanon partnered with the parent company of mCaffeine to create Hyphen, another skincare brand.

These investments appear to pay dividends towards the overall brand valuations of these celebrities, as per industry experts.

Ambika Sharma, founder and MD of Pulp Strategy, explains the impact of these ventures on celebrity brand values. She says, “When celebrities invest in and co-found brands, it significantly enhances their overall brand valuations. This entrepreneurial involvement diversifies their portfolios, adding to their marketability and appeal.”

The trend of celebrities becoming entrepreneurs and investors has broader implications for their brand valuations, as per Sharma. By diversifying their portfolios and taking on roles as co-founders, these celebrities are not only enhancing their financial security but also boosting their public appeal. The authenticity of their endorsements, bolstered by genuine financial involvement, resonates well with today’s discerning consumers.

“When celebrities are financially invested in a brand, their endorsements often come across as more genuine. Consumers are more likely to believe that the celebrity truly endorses the product, which makes the endorsement more impactful and builds stronger brand loyalty and consumer trust,” Sharma elaborates.

Toru Jhaveri, who is the founder and strategy lead at The Stuff Of Life, says that it was only a matter of time before celebrities of India caught up with their Western counterparts, who as per Jhaveri have set the tone for this trend. She says, “Most of these celebrities are fairly young, and discernible. They look at their Western counterparts and find themselves surrounded by similar opportunities and revenue potential. So, why not?”

Some popular examples of western celebrities that have seen success in business include popular singer Rihanna, who launched Savage X Fenty lingerie line in 2018; Jessica Alba who is the co-founder of The Honest Company, a brand that makes eco-friendly baby products; Ryan Reynolds who bought Aviation American Gin, a gin brand, in 2018; George Clooney who co-founded Casamigos Tequila in 2013.

Jhaveri also mentions that these investments also enable celebrities to monetise their brand ambassadorship more efficiently. “From a long-term perspective, this is a very sound and strategic move to make. And when you take on such roles, people start taking you more seriously. You’re no longer just an ambassador.”

Scouting startups

In 2023, celebrities also actively invested in promising startups. Alia Bhatt, for instance, invested in SuperBottoms, a baby diaper company. Hardik Pandya put his money into Yu, an omnichannel consumer food brand, while Katrina Kaif invested in HyugaLife, an e-commerce platform dedicated to health and wellness.

Aviral Jain, who is the managing director of valuation advisory services at Duff & Phelps, a Kroll Business, notes the willingness of celebrities to take on significant roles in their investments. “What we’re seeing is a lot of these celebrities, even the ones outside of the top 5, are ready to take that plunge and get involved as co-founders. Not just as an endorser or an investor, but as a co-founder, which is a big responsibility. Clearly, they believe there’s a lot of value to be created.”

Jain points to Ed-a-Mama’s success as a notable example. “It’s a 100-fold return on what was the first round versus where Reliance came in.” 

There is also a common trend in the kind of business moves that celebs are currently making. Jain points out, “If you look at some of the ventures of the Bollywood stars, a lot of these are now stationed around beauty and personal care, and fashion apparel. So maybe going forward, there could be more involvement on the food and beverages side, and perhaps on the alcoholic beverages side as well.”

International collaborations

Indian celebrities are not only making their mark domestically; they are also increasingly partnering with international brands. Alia Bhatt represents Gucci, Deepika Padukone has a collaboration with Louis Vuitton, and Katrina Kaif is associated with Etihad Airways. These partnerships help celebrities expand their influence globally.

Ambika Sharma highlights the benefits of international collaborations. “International partnerships expand the celebrity’s reach and influence beyond their home country, enhancing their global appeal. These celebrities often act as cultural ambassadors, bridging gaps between different markets and elevating their personal brand image,” she says.

Sandeep Goyal, chairman of Rediffusion, discusses the strategic advantages of these ventures. “Foreign brands hiring Indian celebs is logical—one in six humans today is Indian. So, an Indian ambassador helps make a better local connect. You will see more of it in the days ahead.”

Goyal also comments on the business acumen behind these moves. “Celebrities are surrounded by savvy professional advisors who are cutting deals, dreaming up newer revenue streams, stitching partnerships, and maximising ROI for their celebrity clients.”

However, Goyal warns of potential changes in the endorsement landscape due to new government regulations. “The celebrity game could change a lot with the new norms the government is bringing in. Endorsing negative categories will become difficult for stars.”