Gwyneth Paltrow's Goop Is $1.6 Million in Debt
The actress's lifestyle brand is in the red – but that doesn't necessarily mean her company is in trouble
In fact, according to 2013 financial records filed by Goop in the U.K., the company is more than $1.6 million in debt.
The filing also revealed Goop has over $460,000 in assets. And financial experts tell PEOPLE that the situation at Paltrow’s young, small company is pretty typical.
“It’s very common for businesses to take on debt. That’s how companies grow. Even Apple does it,” Thomas Knapp, of the University of Southern California’s Marshall School of Business, tells PEOPLE. “Yes, Goop’s debt may be higher than you might want, but from 2011 to 2012 they greatly increased their revenue sources.” The 2012 filing also states that Goop paid the company’s directors, Paltrow and Sebastian Bishop, just over $550,000 that year.
Knapp adds that banks and lenders rarely loan money to businesses that do not have strategies in place to be able to repay the loans. Of course, Paltrow has admitted that complex business plans were not at the forefront of her mind when she started Goop as a blog in 2008.
“At the inception, it really was just for myself, my friends … I didn’t foresee the community that I was creating and I didn’t foresee the brand I was unwittingly creating. So, the first couple of years … I look back and I think, ‘What the heck was I doing?’ ” Paltrow said onstage Oct. 7 at the Fortune Most Powerful Women Summit. “[But now] we have a lot of very exciting plans. Goop is becoming this amazing collective of these really bright, really fascinating women, who I am learning so much from.”
One of those women is Lisa Gersh, the former CEO of Martha Stewart Living Omnimedia, whom Paltrow announced as the new CEO of Goop on Oct. 6.
“We are small but we are growing and when it started becoming clear to me that this was a business and we were having impact on other businesses and that it could actually be something, I was so lucky to meet Lisa,” the actress said of her new CEO, whose previous boss has criticized Paltrow’s foray into lifestyle branding. “[Up until now] our base has grown totally organically. We’ve never marketed and I think we have a big opportunity. I just wasn’t smart enough to figure it out.”
In addition to looking into new marketing possibilities, Paltrow also stated that the company is planning on expanding into developing products under the Goop brand.
“I think it’s kind of limitless,” Paltrow says of her company’s future.
And as for Goop’s debts, Knapp laughs as he puts it into context.
“It is basically the equivalent of owing someone $100,” he says. “She could probably go work for two days and pay off that debt.”