The closing of e.l.f. Beauty’s 22 stores raises questions about the viability of a vertical retail model—especially for a value beauty brand with distribution in more than 20,000 doors.

E.l.f.’s Chairman and CEO, Tarang Amin, announced the closures during the company’s fourth quarter earnings report, which continued on a downward trajectory for mass makeup brand. Fourth-quarter net sales dropped 4 percent to $78.6 million, while net income declined to $9.7 million, compared with $21.5 million for the same period last year. Net sales for the year, which Tarang called challenging, fell 1 percent to $267 million.

A lot has changed in the mass beauty landscape since e.l.f. burst onto the scene as a pioneer of the digital-first strategy in 2004. E.l.f.’s website was one of the first to tout beauty tutorials, tips and tricks.

In 2014, founder Joey Shamah revealed the brand’s first physical store in Manhattan, an opportunity, he said, to offer shoppers a chance to see and touch products. Stores also served as incubators for new products that could then be rolled out to chains. At the time, e.l.f. was in its infancy in securing physical store distribution and company stores didn’t pose a threat to chains. E.l.f. was also one of the first fast-beauty companies, pumping prestige-inspired products to the mass market quickly, a competitive edge for mass retailers looking to keep up with specialty stores.

As e.l.f. stores rolled out, mostly to shopping malls, décor was elevated to include technology, a fun play area and Instagram-worthy opportunities. E.l.f. stores now account for 5 percent of sales, and while they played a role in building brand recognition, e.l.f. now has distribution in almost every major big box operator, including Walmart, Walgreens, CVS, Rite Aid, Ulta Beauty and even Old Navy.

In an interesting twist, Tarang said the store closings will allow e.l.f. to focus on direct-to-consumer sales—in other words its roots. It’s DTC site, according to a report from Jefferies, drives 10 times the traffic versus e.l.f. stores. And, interaction with fans often sparks new product launches versus getting consumer reaction in stores.

That said, Tarang added that closing stores frees up resources to bolster retail partners. Late last year, e.l.f. announced an initiative called Project Unicorn aimed at rebuilding its distinctive position in a now crowded mass market. Project Unicorn includes changing some of the company’s product packaging in order to get more new products on store shelves. Some products are coming out of boxes to help them stand out on shelves and the company is doing more behind its cruelty-free messaging.

The company also announced it was searching for a new CFO, following news that its President and current CFO, John Bailey, will step down at the end of March. Responsibilities will be absorbed by Tarang and other members of e.l.f.’s executive team. Earlier this year, e.l.f. nabbed Kory Marchisotto as Chief Marketing Officer from Shiseido, where she was most recently Senior Vice President of U.S. Marketing for BareMinerals.

E.l.f.’s story also shows the changes a startup goes through as it grows and goes public. Marathon Partners Equity Management, which has about a 9 percent stake in e.l.f. has been verbal about its frustration with e.l.f.’s performance and is a catalyst to the company’s ongoing overhaul.