Gwyneth Paltrow says she made 'grave mistakes' with Goop that cost millions of dollars

Goop CEO Gwyneth Paltrow speaks onstage at In goop Health Summit Los Angeles 2019.
Neilson Barnard | Getty Images Entertainment | Getty Images

Gwyneth Paltrow's wellness brand Goop has developed a reputation over the years for promoting wacky and sometimes controversial "wellness" treatments. For example, in 2018 Goop settled a $145,000 lawsuit for making unsubstantiated marketing claims about the health benefits of using vaginal jade eggs.

But making mistakes is all part of how the brand has sustained success, Paltrow told former J.Crew creative director Jenna Lyons at Vanity Fair's New Establishment Summit Oct. 22.

"I thought obviously I have no authority to do anything like this and no one's going to take me seriously," Paltrow said, describing the early days of Goop. "I have learned so much. And so much by making such grave mistakes that have cost millions of dollars."

Although Paltrow didn't elaborate on which expensive mistakes she was referring to, topics that Goop wrote about often caused an "uproar," but then became widespread trends. Paltrow listed detoxes, celery juice and gluten free diets as topics that have gotten Goop negative press but are now their top-ranking stories on the site, which she sees as a success.

For example, the celery juice craze can largely be traced back to Goop, which featured a "medical medium" who suggested making the green juice in a $500 juicer and called it "one of the most powerful healing juices available to us." However, there's no evidence that celery juice contains any health benefits.

And, said Paltrow, "I wrote a gluten free cookbook like eight years ago and people wrote that Child Services should be called on me because I was starving my children," Paltrow told Lyons. "That was a good one. And you know, now gluten free is mainstream."

She's "always been someone that's unafraid to push boundaries," said Paltrow.

"I think that you just have to have conviction that if you believe in what you're doing," she said. "And [if] you believe that you're reaching people in a way that's resonant for them and positive, you just keep going."

Paltrow said she simply said she doesn't read the negative press.

When Goop launched in 2008, it was just a newsletter with travel recommendations and health tips that Paltrow would send from her kitchen table. Today, she is the company's CEO and Goop has received over $80 million in total outside funding, including its most recent $50 million series C funding round in 2018, according to Forbes. The New York Times reported in 2018 that the company was worth $250 million citing "a source close to the company."

"I think that I had a lot of trepidation about planting this little flag — and saying like 'I want to do this, but I don't know if this could be a business' or how I could execute the business; but it was scary for me to do it," Paltrow told CNBC's "Trailblazers" in 2017.

Having the confidence to go into an industry that Paltrow knew nothing about was a skill that she learned from her years working as an actress, she said in the same interview.

"Acting is a very entrepreneurial career," she said. "You have to sort of connect to that level of self belief that entrepreneurs have to have. This abject, sometimes naive, occasionally stupid amount of self belief."

Other practical aspects of running the business, like developing e-commerce software, were harder to figure out or fake, Paltrow said.

"Our whole e-commerce technology has been so problematic from the beginning because I had no idea about technology whatsoever," she told the New York Times in 2018. "Our original tech stack was this Frankenstein."

But Goop's branded products sold on the site, including skincare and supplements, are the company's fast-growing revenue stream, Forbes reported in 2018.

"You can't know what you don't know, and I certainly was never in a position to understand, like, 99 percent of the things that I had to learn from an operations standpoint," Paltrow told the Times. "So I made mistakes left, right and center."

Even today, making business mistakes and provocative health suggestions still garner attention, which "really benefits us," Paltrow told Lyons.

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