A Starter Guide to Celebrity Capital for Consumer Brands

In the consumer brand world, a celebrity founder or investor has often demonstrated an ability to move the needle at early stages. Even within CircleUp’s equity portfolio, we’ve seen brands benefit from these partnerships/investments — just take a look at Liquid IV, Kosas and Art of Sport.

Despite the investment activity in this segment, there’s very little practical advice available for founders about how to raise capital from talent. On the other hand, influencers are overwhelmed with deal flow, most of which is not a good fit.

By Thomas Wolf, www.foto-tw.de, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=43944121

It is an incredibly murky marketplace and an unfair one — who you know matters. And, that’s not okay. I strongly believe that we need to bring clarity to the world of celebrity investing, in order for investors, operators and influencers to build better brands and ultimately serve consumers.

With that in mind, I’m sharing some learnings and best practices about celebrity capital. The details outlined here are just some examples of “normal” deals, but the range of partnerships is massive. This is not all-encompassing — it’s a starting point.

If you agree, disagree or want more detail, find me on Twitter (@aditi_sf).

A Framework for Deal Structuring

In instances when a celebrity is the founder, the celebrity typically raises capital from traditional investors and is actively involved in day-to-day business decisions (sometimes as CEO). On the other end of the spectrum, celebrities function exclusively as investors making decisions about a company in the same way as a traditional venture capital firm (there’s a committee that evaluates deals and a very specific set of criteria that determine whether an investment is completed). Everything in between is where it gets complicated. That’s what we’re talking about in this post. Sometimes a celebrity acts as a co-founder in an operational capacity and other times they are just the face of the brand, and there’s a wide range of possibilities in between that I’ll try to break down.

You Give Them Money (Not the Other Way Around)

Instead, an early-stage brand will often need to set aside $500K-1M of cash to work with a celebrity (this is cash that needs to come from the business or from other equity investors).

A celebrity investment is more akin to an endorsement deal, and it works much better for conspicuous categories (or brands that bring visibility to historically taboo topics). To me, the beverage category (alcoholic and non-alcoholic) makes a lot sense for a celebrity partnership. Consumers frequently carry around branded bottles and order drinks based on brand, and some of the most successful celebrity deals have been in the beverage area i.e. Fifty Cent/Vitamin Water, P. Diddy/Ciroc and Ryan Reynolds/Aviation Gin. For categories that are less visible, a celebrity partnership just isn’t as valuable, in my opinion.

Terms Unique to Celebrity Investments

  1. Upfront Cash: many celebrities will require an upfront payment that can range from $10K all the way to $1m and depends on the reach of the celebrity/influencer
  2. Ongoing Royalties: should be related to brand performance and makes the most sense for stars with significant number of followers (+2million is one benchmark I like to keep in mind) or an image highly relevant to a brand
  3. Salary: if a celebrity is billed as co-founder, they may want a traditional salary as well.
  4. Vesting: also referred to as performance equity (celebrities will get a higher % of the business based on brand performance, similar to royalties)
  5. Opportunity to Invest Money in Future: even for celebrities that don’t want to invest upfront, they may want an opportunity to directly put more capital into a company (as the celeb & brand gets to be more successful)
  6. Service agreement: a celebrity’s time needs to be accounted for (and paid for). This is where a service agreement comes in — it should encompass the following:
  • Traditional Media: campaigns (and time required for photo shoots, etc)
  • Social Media: outline everything related to engaging the existing social following of a celebrity (number of posts, content, time frame, platform)
  • Innovation: Many celebrities care about making products with and alongside brands, and this needs to outlines (List out co-developed products and engagement required/expected of celebrities)
  • Appearances: when, where, why do you need a celebrity?
  • Public Relations: which publications will be targeted or blacklisted?
  • Travel & Lodging: celebrities want this paid for (may be related to appearances)
  • Hair & Makeup: looks matter (related to appearances/campaigns)
  • Image-related Terms: a celebrity’s “image” is really important, especially today. It’s important to discuss approval rights on reposting (image & frequency). A brand will likely be limited on how often it can use a celebrity in their social media (and what can be said about/attributed to the celebrity)

Keep in mind that the most successful celebrity investments happen when both sides are completely bought in — if a founder and celebrity really jive, there’s a lot of extra effort that will come through that won’t be documented. This is true for any investor — if you find someone that believes deeply in a brand or mission, they will go the extra mile.

Who Will Move the Needle for a Brand?

As mentioned above, a brand must align with the talent in order for a relationship to be “worth it”. It must make sense for the brand & celebrity to work together from a qualitative perspective. Once that basic tenet has been established, the conversation can move on to structuring.

A Framework to Consider

Use a Wealth vs. Relevance framework to think about deals/partnerships with talent

High Wealth + High Relevance (Mega Talent)

This is where a brand will want to invest major capital, given these are big stars that place a high value on their time. From a relevance perspective, these celebrities have millions of followers and high engagement. Celebrities can potentially receive all of the following:

  • Traditional Equity (up to 40% of the Company w/Vesting)
  • Royalties (based on Company performance)
  • High Upfront Cash Payment (ideally up to $400K, but it can be up to $1m)

Low Wealth + High Relevance (Emerging Talent)

This is the emerging TikTok star with an insane number of followers and great content but limited accumulated wealth. In this scenario, be prepared to give to talent:

  • Traditional Equity (up to 25% of Company w/Vesting)
  • Salary (review/renew annually). From a cash outflow perspective, it is a similar concept to royalties for a brand, but from a positioning perspective, a guaranteed salary might be more enticing for emerging talent(and ideally lower than royalties)
  • Low Upfront Cash Payment (under $50K)

High Wealth + Limited Relevance (Former Mega Talent)

While this celebrity may not have as much relevant marketing to offer, they may have a network useful to tap into for a brand. Focus on bringing this celebrity in as part of a syndicate in an existing round. Only do a marketing deal if celebrity is hyper-relevant to the brand

Low Wealth + Limited Relevance (Microinfluencers)

Managing microinfluencers is a whole separate topic. I’ll briefly mention it here since celebrities and influencers are evolving — anyone can be an influencer, so it’s important to consider microinfluencer ROI in contrast to celebrity influencer. Microinfluencers (depending on size) can get paid via:

  • Free Product Samples
  • Affiliate Fees / Commissions
  • Pay per Post

Celebrities are People Too

It is equally as important to educate a celebrity on equity investing and startups. Many celebrities will have heard about artists like 50 Cent or Ryan Reynolds making money via equity, but they likely won’t understand how a transaction is structured. Help celebrities learn about the ins and outs of a deal — become that trusted partner to them even before a deal is finalized.

Founders must position their brand as one that fits into the world of the celebrity — articulate EXACTLY why your product matters to the celebrity.

Who You Know Matters

Icons: Noun Project


Concisely identify why a celebrity or influencer would identify with your product. Then, figure out any and all connections you have to a celeb (if your college ex-boyfriend was friends with Katie Holmes in middle school, email him). If you choose this approach, you’ve got to be shameless shamelessly.


Go through an individual that works with or rolls with the celebrity. This could be anyone from a business manager to a hairdresser to a friend. The most influential celebrities often have a large posse — it can be difficult to figure out who actually has sway. Identify the roles that people play; tailor your approach accordingly. Start targeted approach in this order:

  1. Business Manager (if there is one): often the business manager is the actual decision-maker when it comes to equity partnerships
  2. Manager: in charge of all marketing, image and appearances. Must ensure that a company is “on-brand” for the celeb
  3. Agent: responsible for booking films, shows and specific roles for talent. They are not usually the person that is responsible for equity deals.
  4. Wealth Manager: better place to start if you want the celebrity to be just part of a syndicate
  5. Assistant: in the world of celebrities, assistants have a lot of power
  6. Other: hairdresser, childhood friend, bro…

There’s likely little to no protection of your deck & data — assume that it will get forwarded around, so only share what you’re comfortable with.


There are several firms/groups that have emerged and are are responsible for brokering deals between founders & celebrities have emerged. I also classify talent agencies with investment arms in this bucket, along with celebrity brand incubators.

Most venture firms now have relationships at these deal-maker type firms, so get introduced through a VC you’re close with. Remember that fees can be high (not just to celebrity but also the the broker for setting-up the deal). Here’s a list of firms that I classify in this category:


There are funds that are founded by celebrities or influencers. Treat these folks like any other venture fund. VCs (actually most people) tend to dislike cold outreach when it is not specific, so reach out or get introduced to partners.

Fundraising is Sales

Above All, Alignment and Education Matters Most

Good Luck!

The most frequent questions on celebrity investments are related to structuring a deal. At the root of this question is a desire to understand how best to align incentives, so talent and founders are working towards the best possible long-term outcome. Celebrity deal structures can be very complicated and every deal is different. Before we get to a framework for structuring a deal, it’s important to bucket the different types of ways that celebrities get involved in startups.

Consumer investor @ CircleUp. Product obsessed. People focused. Easily intrigued. Rarely impressed.

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