How Much Does a Celebrity Endorsement Bring to a Social Startup?

Celebrity involvement in startups was the buzz at the Variety Summit in Los Angeles. Read on for advice from the experts.

Celebrity involvement in startups was the buzz at the Variety Summit in Los Angeles.  Read on for advice from the experts.

L.A. startups are leaders in using celebrities to make their startups successful.  Creativity is trumping pure tech-savvy in the current social boom, say Hollywood-savvy execs and venture investors.

Celebrities are bringing their creative power to help with social media campaigns and product management. Celebrity driven L.A. startups include BeachMint, ShoeDazzle, Viddy, StageIt, MoonShark and Yowza – and don’t forget Justin Timberlake is a top executive at MySpace!


Give Celebrities Equity in Your Startup

“If a celebrity reaches out to a CEO and says ‘I love your product, I want to get involved’, it makes sense for the entrepreneur to make an equity grant to them” says Kent Goldman, Partner at First Round Capital.

Celebrities should not blindly jump on board startups though, Kent warns.  “Celebrities should ‘check the log files’ to confirm that users are as enthusiastic about the product as they are before committing”.

Warning:  Celebrities Don’t Guarantee Success

Startups should not count on celebrity involvement to automatically make them successful.

Justin Bieber mentioned the mobile app Viddy on air during a major TV show.  It was a complete surprise to the company.  Viddy braced for the traffic it would generate – and then nothing happened. However, when Justin Bieber later tweeted “you should download Viddy, here is the link”, Viddy got 30,000 downloads immediately says Chris Ovitz, Chief Evangelist of Viddy.

BeachMint is a social shopping startup that partners with Kate Bosworth, the Olson Twins and Jessica Simpson.  BeachMint knows how to successfully involve celebrities in social media, and aggressively tracks the results of their campaigns. But I was surprised to hear celebrity tweets are not a silver bullet!:  “Moms in Dallas who tweet often have a better conversion rate than celebrities with 2 million Twitter followers” says Ara Katz, who handles celebrity relationships for BeachMint.

The Secret to Celebrity Involvement

Startups can’t expect celebrities to stay focused and enthusiastic about their product simply because they are incentivized to do so.  Celebrities lead busy lives and have tons of people trying to get their attention.  Imagine an exhausted celebrity trying to remember to tweet about you or use your app after a big performance!

So what is the secret?  The celebrity entourage! Celebrities have a group of people who they trust and that are loyal to them.  Involving those people in your startup is the best way to make the relationship successful, advises Damon John, Founder / CEO of FUBU and star of “Shark Tank” on ABC.

“Take someone off the celebrity’s payroll” explained Damon.  Celebrities will love that someone else is paying that member of the entourage to hang around, and that person will have a reason to whisper in the celebrities ear about promoting your product.  “Having a live person next to them is critical … Trust me, I’ve been doing this a long time.”

Success Story: Kim Kardashian and

Celebrity engagement in social media led to traffic, transactions and trend leadership for eCommerce startup ShoeDazzle.  Kim Kardashian is a hands on Co-Founder & Chief Fashion Stylist for

“Social was key to our early growth” said Geraldine Martin-Copolla, Chief Product Officer of ShoeDazzle.  “Kim was big on social media, and had a huge Twitter following”.  Twitter became a important traffic driver for the eCommerce site.  As a result, ShoeDazzle followed up big investments in custom Facebook apps – and this engagement led to a fan page with 2M+ Likes.

Pinterest is huge for ShoeDazzle as well.  ShoeDazzle now has double the amount of Pinterest “pins” to Facebook Likes. “It is important to be able to capitalize on new trends in social” says Geraldine, “its amazing how fast they emerge”.

Readers, do you dream of involving a celebrity in your startup?