Latest / Imagine If with Doone Roisin | Health, Wealth & Wisdom for Women (formerly Female Startup Club Podcast) / How to get started in fashion and why wholesale won’t always work, with luxury sleepwear’s queen of dreams Ashley Merrill, Founder of Lunya

Transcript

How to get started in fashion and why wholesale won’t always work, with luxury sleepwear’s queen of dreams Ashley Merrill, Founder of Lunya · Imagine If with Doone Roisin | Health, Wealth & Wisdom for Women (formerly Female Startup Club Podcast)

• 0:00
  This is Ashley Merrill for Female Startup Club. Hey everyone, and welcome back to another episode of the Female Startup Club podcast. I'm your host, Doon Roshin, and joining me on the show today is Ashley Merrill, founder of luxury sleepwear company, Luna. Hi.
• 0:26
  Luna is a company that's reinventing sleepwear for the modern woman through carefully crafted pieces that are transitional and beautiful. In this episode, we're covering Ashley's path to getting started, her advice for the early days of building a business in the fashion industry, and why a wholesale model didn't work for her in the beginning.
• 0:44
  And while I've got you here, if you're a small brand, I would love to hear from you to learn what's been working for you in marketing at the moment. You can find my email in the show notes of this episode and reach out directly. This is Ashley for Female Startup Club. Ashley, hi and welcome to the Female Startup Club podcast.
• 1:04
  Thank you for having me. I am so excited about this conversation. I feel like you have so many cool things going on in your life, like I said just before. Board member for Girls Inc., chairwoman of Outdoor Voices, successful entrepreneur of multiple startups. We have so much to discuss, but I want to start with you just giving us an overview of who you are and what your business is.
• 1:28
  Sure. Well, my name is Ashley Merrill. I live in Los Angeles in California, and I actually have a women's sleepwear company called Lunia, and then the male counterpart for that, which is Lago. So cool. Let's get started by going back to life before Lunia, pre-Lunia. What were you doing that got you interested in the sleepwear category specifically?
• 1:52
  Yeah, so what I did pre-Lunia doesn't actually connect at all to sleepwear, which is funny. But I think it was just... So what I did pre-Lunia was I worked in an online media company. We built web portals and had an advertising-based business.
• 2:10
  And really where Lunia came from was a personal experience. It was me kind of feeling the gap in the market as a consumer going, hey, what am I going to wear around the house? I was wearing some old hand-me-downs of my husband. And sometimes that's what happens, right? I think opportunities are almost best found by people that are experiencing the problem. They often are really well suited to solving them. So I didn't know that then, of course. I just felt the pain of it. And then ultimately...
• 2:37
  didn't start the business for quite some time after I recognized there might be an opportunity for probably all the reasons many people don't start a business because I wasn't sure that I, you know, why me? Why would I be able to do that business? But that is really where it came from. And what made you think, yeah, okay, me, I'm going to do it. What was the change?
• 2:56
  Well, so the change really came from, and this is kind of a funny story, but I had always felt like kids, even though I feel it's funny saying this now, but I always felt like, oh, maybe kids are going to be the thing that holds me back from having career success in life. And I think I felt that because for a lot of women around me, that was what I saw. You know, the challenge of balancing kids, family life and professional life. I mean, I just rarely saw that succeed. I can see professional women. They were, you know, it's really hard to make that happen.
• 3:23
  And so I just, I had always had that feeling. And then what happened was I was in business school. It was in September, 2012. I was in business school. My husband and I had decided to start a family. I figured that at some point I would start a business and it would be in like an online media area.
• 3:40
  bent because that was my background. I knew that there was a lot of engineers that were attending business school. And so I figured maybe I'd like to pick up an engineer, we'd start something, or maybe someone else would have a business that I could like jump into. And so, you know, all this was kind of happening. I wasn't sure though, I was kind of plagued by uncertainty, as I think a lot of people are. And then what happened was, we had decided to start having a family and I got pregnant right away, actually. So like literally found out I was pregnant end
• 4:11
  you know, I might be right. I might not know anything about clothes and I might fail at this, but it felt worse to have to tell my kids that I didn't even try than that I tried and I failed. And so in this fascinating way, my kids actually became the motivation for me. They became the thing that finally pushed me over the edge because my fear of having to tell them I never tried definitely started to outweigh my fear of failing.
• 4:38
  Gosh, isn't that amazing? I love that. So special. How great. Yeah, never would have thought that. Never would have thought it. So you have this kind of epiphany, you're thinking you're going to get started. What are the actual steps to getting started? How do you go about starting a sleepwear label, you know, in those early moments of making the decision?
• 5:00
  Yeah. So in my experience, and I think this is because how my decision making process works. So I'm going to like take this in a weird direction for a second. When I go to buy a table for my house, like I know I needed like a console table.
• 5:16
  I'm on Pinterest for a while researching all of the options. And oftentimes I might come back to the initial one I like, but I need to like really be sure there's not something else there that's better for me. So my process of starting Luna, and I realize now as I'm like become an older person and looking back on this, really was no different. Like the hardest part of getting started for me was for me to convince myself that this idea was an awesome idea.
• 5:41
  Once I could get confident about the thesis that I had, you know, I could move forward. I could move forward in terms of like doing things, making connections, but I could also convince other people of the value of this idea. And so a lot of the early time was me going, trying to think the idea. Like I tried to think the ship a hundred different ways, you know, like I'm,
• 6:03
  how's it going to make money? Why does the world need this? Like, how am I going to convince people, you know, just like a million reasons why I didn't think this idea would work. And I just could not after, you know, I would like, almost try to sink my own ship. And then I would have to like prove myself. So it's like, almost like as if I'm two different people having a conversation, internal debate. And so the process of me saying yes, was the end to that. It was the
• 6:26
  You know, I'd spent years. And so I'm not saying I decided this. And then I was like, but I had spent years with that battle in my head. And because, and by the way, there've been many other ideas I had had. And I can sink those ships. And this was the ship I couldn't sink, you know? And so once I sort of said, okay, I'm going to stop trying to kill the idea. And I'm going to just do it. What it did was I started going to other people and saying, I have this idea. And here's how I see it playing out.
• 6:53
  And what I found to be amazing, and this is honestly, it might be a female thing and it might be one of the coolest things about being a woman as an entrepreneur today, but it's like people really wanted to help me, you know, or so that was my experience and especially women. I think there is sort of a shared journey that we are all having right now where we're all kind of like,
• 7:12
  We want to see women accomplish things. And men too, by the way. I think that men sort of feel that same way about this journey. Like, we need to see some women win. And so, you know, it was really cool because when I started putting this like, fragile idea out there that I was like, I am starting to believe this is real. You know, and I started like telling people I know, they started connecting me. So a silly example to get specific was, there was this clothing store that I used to go to. And I remember going in there and just, I would always chat with the woman who owned the boutique.
• 7:42
  And she was just a little bit older than me, but she'd been running the store on her own for a while. And so I said, I told her my fragile idea. I have this idea to go into sleepwear. Nobody's in sleepwear. I want to do it differently than a lot of people are doing it in that I want to make something that's like, actually got a functional point of view, not, you know, and it's really high quality. And it's got this transitional element where you can wear it in and out of bed. And so I kind of like gave her my pitch, not intentionally, but I was just excited. So I was talking to her and she goes,
• 8:09
  Oh, I know someone you should chat with. And she's like, one of the brands that I work with, I think their girl that runs production, she does some consulting. And so she connected me, it was almost like if you look at it, it's like, the whole experience was a bunch of breadcrumbs. And that happened. And so I called that girl. And that girl's like, Oh, I know this designer, maybe you can call her. And so like, this was happening much broader than this one experience. I'm giving as an example, right? I'd go tell other people, and they go, you should talk to this
• 8:35
  70% of the leads were bunk, you know, but the 30% were enough to keep me moving forward. And I think like I sort of joke about entrepreneurs, I think that we're just like, we're able to just get sort of beat up every day and keep going back. Like it sounds kind of crazy, but it really is sort of a determination exercise. Like, it's not easy. And I had to keep going like, yeah, you know, you say yes to everything. I make those connections. I go to the next one, I keep pushing forward. And all
• 9:02
  ultimately over time, even today, what's happening is you're sort of building momentum. And then people are joining you as you start building teams and things. They're joining this giant ball of momentum. And then they're helping me push the ball forward. And then eventually, there's a lot of people pushing the ball forward. And you're really like, you're just one of the many. And that's kind of like how I would describe it. But in the early stage, you're taking this heavy stationary object and you're just inches day by day. So that was really what it looked like. Very unglamorous.
• 9:30
  I love that. What a great analogy. Totally. In the beginning, it's like a hairball. And in the end, it's more like a snowball. It's growing. So was this happening? Because you launched in 2012. So is this like 2011? It was September, you've started connecting with people, you've found this designer, you've then found a manufacturer. What's the kind of like development process there? Did it all come together quite quickly? Or was it quite long?
• 9:57
  So I launched in 2014. I started working at Looney. I incorporated the business in 2012 and started there. Got it. It took me two years to get something and a website that I can sell. And it happened to... I had two kids in that timeframe too. So it also just was slower because I had personal stuff going on. But it was...
• 10:18
  And I would say it was very slow. And also everything was two steps forward, one step back. You know, like you'd get the designer and it turns out like the designer's, nah, maybe not the right designer. You know, like you'd go. So there was like a constant state of that. And you'd go to the manufacturer who was going to make it. And like, nobody wants to work with you when you have a small company. Like this is the other fascinating thing I think is really manufacturing across the board. Whether you're making like a CPG, a beauty product or, you know, whatever you're making, it's a game of quantity.
• 10:48
  You know, nobody makes money at small quantities because it's going to take all the time to set up and build the lines and there's no efficiency in the process. So it was like I was, nobody was jumping at the bit to take my business. So, you know, it really looked like, you know, I would find a manufacturer, they'd say, no, I'd get a name from them. Can you find me go somewhere else? So I'd be just driving all around downtown, just trying to find somebody who had the quality who would say yes.
• 11:14
  And then even then, what I remember happening, which was crazy, is I got this guy downtown to say yes, but he wouldn't commit to time frame. And I was the lowest priority. So anytime we'd get another order, it would just be like my stuff would fall behind that order. Because, again, I was just too small in quantity to be able to.
• 11:33
  priority. And they just really weren't keeping my stuff organized. I was baking cookies, like showing up with cookies at the manufacturer being like, I was begging them. And I was begging them, you know, just to complete my stuff. But it's really like, I had to get started. Like, I've talked to people even about the economics of my business early on.
• 11:50
  My favorite would be when people would like to complain on Instagram that my costs were so high. You know, Luneo is expensive. And I'd be like, okay, I basically just, so you know, like, I paid you to buy that product. I lost my, you know, my butt so bad on all those things I made, because, you know, the cost to manufacture was through the roof. I was buying very small amounts of yardage, you know. And so you're making all this big investment in terms of time and money and all this and
• 12:15
  It really is because you have this vision of where it's going. But early on, it doesn't feel anything like it'll feel as you have success. Like where I am now and what I spend my time on and the relationship I have with manufacturers. It just doesn't look anything like that. But that's the getting started process for you.
• 12:31
  Gosh, that's crazy. What do you think? And this is more for advice for anyone who is perhaps wanting to build a fashion label and or, you know, whatever the category is, but is also facing those same challenges where, you know, they're small and they've got to find someone to commit to you. What was it that you think got that manufacturer to say yes to you?
• 12:51
  Well, I had built a business plan and I showed it to anyone that I wanted to work with because a lot of it, and this is where I say, first you have to convince yourself and then you need to have that kind of conviction so you can convince other people. I was having to pitch manufacturers with my business plan in order to get them to believe that there was even a reason to take time on this. So, you know, that business plan, that was pretty key early days. Totally. Yeah. That's great advice. Getting everything together. Yeah.
• 13:20
  Yeah, even when I onboarded employees, I pitched them my business plan. Like, why work for me? I couldn't pay them what other people could pay them. I was going to ask more of them than other people. Why would you work for me? And it's like, oh, you work because you believe you're part of building something and you kind of got a sense of where we were headed and you like, you know. Totally. I always love to ask about the money side of things. How much did it cost to get started? And what kind of capital do you need to start a brand in the fashion industry? Yeah.
• 13:48
  Yeah. So I think there's different ways to start businesses. Early on, I think my rule for myself had been like I was going to put $20,000 into it to get to some kind of a proof of concept. And it was me and I had a girl named Jasmine who was part-time with me for a while. And then we had to pay for cost of goods and we had to get a website up. And so that was like roughly what we had spent. I think that was also a few years ago. So I imagine you might need a little
• 14:18
  I also think it's different whether you're making a direct-to-consumer brand or if you're willing to go wholesale first. I think originally, my brand didn't work so well wholesale first. And I think now because DTC feels all sexy, everybody wants to go DTC first. But I would tell you it's much more cost-prohibitive. It's more expensive to get started on a DTC business than it is if you're willing to do wholesale first.
• 14:43
  Wholesale is basically a way where you don't have to build, like, if I were to get specific, in order to build something that's going to go online, you have to be a really strong marketing organization, not just building a product, because you're going to have to acquire users and you're going to have to have capital to spend on user acquisition through Facebook or, you know, whatever, however you're planning to do it.
• 15:03
  And you have to have, you know, models, professional photography, in-house people to manage your social media account, you know, to manage your website. You know, you're going to need a lot of these things. Whereas if you start wholesale, you know, you might be able to do it without a lot of those functions. And that means you could probably be you and maybe one other person working out of your basement, so to speak, for a while while you get going and get some capital and you could let that fund the rest of the business.
• 15:29
  I think it depends on what kind of business you have, what your eventual plan is for that business. I think for Lunia, what happened was I wanted to address Sleeper in a really different way. And when at the time, remember, this was a while ago, 2014, DTC was more rare then. Everybody was like, why aren't you starting in wholesale?
• 15:48
  And I would have started in wholesale. I actually wasn't one of those people that was like, oh, wholesale is so lame. I didn't start in wholesale because I just didn't know how I was going to explain why my product was expensive and why it was better than anyone else. If I just stick it next to the penguin pajamas in Nordstrom, how are they going to understand that I'm spending $22 a yard and there's flat seams when you turn inside and outside and all the work I was putting into it?
• 16:13
  I just wasn't going to be able to convey that. And so I was like, why would anyone buy this if I put this in Norton? Because they won't understand. And so I just felt like I was backed into a corner with DTC. Like I really had to in order to be able to explain to people where the value proposition was. And so that's kind of what happened with me. And I think if you're super capital, you know, if you're constrained, I think that can be a wholesale can be a great way to get going. Yeah.
• 16:35
  But, you know, I'm in a very lucky position. I've been able to fund this business. But it's no joke how much capital it takes over time. You know, definitely it takes millions of dollars over time. And, you know, at this point, now, lots of millions, you know, like tens of millions of dollars. And I say that because I think you can approach this. And I have friends that have put far less, you know, capital into their business. And I'm like reinvesting all the money Luna is making back into the business.
• 17:02
  My friends that have put parlous in, they just have to be more comfortable with the slower growth curve, you know? And so I think this all comes down to like what you're, that's why I say it's like, you do need to build that plan and clearly identify what you want to do. You know, and if you're saying, hey, I'm looking to build, I'm passionate about fashion and I want to have this like cool,
• 17:22
  creative, whatever I want. It's like wholesale could be super smart for you, you know? And so I think that could make sense. Or if you're actually looking at it, like for me, I was like, I want to be the Lululemon of sleepwear. And so for me, I was like, oh, I need like category differentiation for me.
• 17:38
  you know, I have to invest in this differently. And I also felt like I was trying to build a category that no one was buying for. It's hard to remember that now because we're living in a COVID world where everyone's buying sleepwear and sweats all the time. But if you were to like zoom back to 2014, people were looking at me like I was an alien when I was talking about the fact that I thought sleepwear and time at home was gonna need a special outfit. But what I was seeing that was coming, I of course never would have thought COVID was coming, but what I saw that was coming was
• 18:08
  you know, entertainment had moved at home. Like I hadn't gone to a movie theater in a very long time. I was like with live streaming at home and the cost of TV is going down and everybody I know using Netflix and getting off cable, like people are going to spend more time at home. And then with Postmates and all the delivery services that are bringing things to your door, I realized our date nights, we were opting to stay home on them. And so what I realized is like the shift home was happening. And I think I thought maybe work from home would be a thing, but at that time I didn't really, you know, obviously...
• 18:38
  Never could have, like I said, never would have seen where we are now. But my husband's in gaming. And like, I definitely saw how people were building online communities there. And that that made a lot of sense in a lot of ways. So I think for me, my thesis was, this is going to be an increasingly important part of our day. And you're not going to want to wear your old clothes for it. But, you know, people thought it was crazy for like,
• 19:00
  quite a while of that conversation. You know, they're just like, oh, there's no important sleepwear category. There is no, at the time, I wanted market stats on it. Could I get market data on what the potential was in the market? There really wasn't even any data on sleepwear. It was just such a small industry. There wasn't macro data.
• 19:17
  Wow, it's crazy. And to think now you've really hit the nail on the head, especially accelerated due to last year and this year and what the future means for us. When you say you wanted to build the Lululemon of Sleepwear, does that mean in terms of, okay, well, I need to follow a business model that is going out and raising institutional funding? Or does that mean in the way that you were going to market the brand and build it through marketing?
• 19:40
  I mentioned the way they solved problems from a product point of view. So I think Lulu is still, despite how saturated Athletic Wear is, they're still one of the very best in the business in terms of quality and innovation. And I think solving problems for their core customer, you know, so they understand how that, you know, their guest is living and what she's looking for. Let's say she's going to a yoga class and do they have the product for that? And so they're taking the time to do that and develop really great products for that. And so...
• 20:09
  I looked at them and went, I want that same kind of problem solving mentality to show up and how I'm thinking about sleep and lounge. And so that was really what I was comparing to and went, look at what a great job they do building community. I mean, remember, they're the OG brand that did this almost they're like over 20 years old now. But, you know, they really helped set up that industry. And of course, now you're looking at a marketplace that has a lot of players in it because the appetite is large, but they helped create that appetite.
• 20:37
  Got it. Right. I understand. I want to switch topics and talk specifically about marketing, especially in those early days when, you know, as you say, people thought you were crazy and they didn't really get it, but you also couldn't sell through wholesale. So you needed to, you know, drill down on online marketing and that kind of thing. What was your launch strategy and how did you start getting your early customers and your early eyeballs on what you were building?
• 21:01
  Kind of a funny story. Love a funny story. Get ready. Yeah, brace yourself for this one. So what we did to launch was we put the website up and we put, you know, like a password protected screen over it. So you had to sign in. So initially what I did was I reached out to my friends and family. It was like, the website's up. Here's the password. Feel free to check it out or transact. It's live, but it's in like beta mode. So, you know, enjoy kind of thing.
• 21:32
  We had it like that for a while because we were just really weren't sure like this was our first time doing something like that. So it was like I said, me and one other person and neither of us had any real experience building. And so then what happened was I was pregnant, as I mentioned, and I was going in to deliver.
• 21:49
  And then what happened was I was thinking, this was when Facebook was a little bit more of a thing. And I was on Facebook thanking my colleague, Jasmine, who I mentioned, for just, you know, thanks so much for like supporting me through like with this business. And, you know, all these kids and, you know, just being like kind of a public thank you. And then what happened was I had linked to Lunia in the comment. And like, I just in the like, hey, thanks for helping me build Lunia. And like it had linked to Lunia and all those things.
• 22:17
  people started commenting on it and resharing it because they thought I was launching. So they were like, congrats, Ashley. Oh my gosh. And they were sharing it on their Facebook feeds. And I was like, oh wait, no, like it's not launched. You know, don't share it. Like, well, I'll let you know. And I was like freaking out. But I was like in labor. I was in the hospital.
• 22:37
  And so at a certain point, I was just like, I'm never going to get these people to share it again. Like you have to ride the wave when it's coming for you. And I just, I bit the bullet, put the website live literally from the maternity bed. And that was what happened. So it was kind of funny. It definitely was like not the launch plan that I think anyone would recommend. And, you know, I was lucky in those days, I wasn't entering in like a highly competitive field. So I do think
• 23:03
  In a lot of ways, I got away with some of my mistakes because it wasn't like competitors were checking me out and trying to annihilate me. I was just... I was winging it. So that was what happened. It went okay. But when we talk about getting first customers, it wasn't like anybody really went. I probably got a handful of orders. It was small. You think you're going to put this website up with this product that you've agonized over, that it's going to solve everyone's problems at home.
• 23:30
  that there's going to be like this inbound rush. Yeah, there's just not. Like it's like maybe your parents, maybe a friend, you know, a couple other friends, a friend to a friend, but like that's really as far as that went. So now getting to your question about like, how do you get from that to something more?
• 23:46
  What I have this sort of theory, if you're going to be resource constrained, you can't do everything. You know, I was in business school. And one of the big lessons that I had taken away from it was, you know, focus, because people like, Oh, you should get into bedding and kids. Everyone was so excited about all the opportunities around it. I was like, Yeah, yeah.
• 24:02
  Or I could do one thing really, really well. I mean, In-N-Out works. You know, they make great burgers. They could make more. They could sell them at a grocery store. They could do all of that. But their core business is pretty great. And so, you know, I hadn't developed a core business. And I think that's, I looked at marketing kind of the same way or even just growth the same way, which was, you know, I could do influencer. I could do Instagram. I could do events. I can do all these things. But in order to sustain all of those growth strategies, I was going to need a big team and increase my burn rate pretty considerably.
• 24:32
  So what I tried to do was go, what is my highest ROI activity? And how can I answer? Of course, I didn't know how to answer that. But I was like, how could I answer that for myself? And so what we did was try a few different things in lo-fi ways. We did events. I literally showed up at my husband's office. We made like 500 brownies around Valentine's Day. He has a decently... He's got a lot of males that work for him. And I was like, perfect.
• 24:58
  I'm going to go to this office space, try to get the guys to buy stuff for their girls for Valentine's Day. I love that. Yeah, you can see baked goods like has a theme in my startup. But yeah, I've made a lot of brownies. And we're like, you know, score brownie points by Luna, we'd like have this whole cute, like little pitch going. Oh, that's good.
• 25:14
  Cute. All these things. Like lots of little, like, you know, we'd go to around the holidays. I had friends that were having like holiday gifting events at their home. And we'd like pop into those and, you know, buy like an Ikea rack. And like, I mean, it was pretty lo-fi.
• 25:30
  But it all took a lot of energy, a lot of time. I'd have to spend a whole day there and maybe me and one other person, honestly. And so we tried other things. You know, I tried influencer, but really my cost of goods was high, as I mentioned before. I think if you're in beauty, influencer is awesome. Your cost of goods is super low. You send it out to everyone you know and more, you know.
• 25:51
  But my cost of goods was high. Like I said, I was paying $22 a yard at that time. And if you imagine that a set is no less than, let's say, a yard and a half. So just from a fabric raw materials cost, I was already in for $35 or something. Then sewing, then shipping, then all the things that go on top of it.
• 26:13
  when I was selling it, I was like, I can't give this away to people and have maybe what I was noticing at that time, I was an unknown brand, but it was like, maybe a 30% chance they'd repost, they'd post it on their Instagram. And then from there, what are the odds that they happen to have people, you know, it's just like it was low conversion. It was nice brand awareness. But at a young stage like that, where I was trying to be capital efficient,
• 26:36
  Brand awareness wasn't really something that was in the cards for me. You know, it was like it had to be conversion oriented. So what we did was start experimenting with Facebook ads. And I was early to that process in a way that I don't think people could get away with now. But we looked different. We had a different message. We had a different message.
• 26:53
  We honed our creative a lot, our messaging a lot, until we could make it sell online. And that was the moment where I knew I had a real business. The second I could scale my ads enough that I could sell enough products, so my cost of goods would come down, and I could acquire that user at a rate that was low enough that I could make $1, $0.50, or even break even on it, I went, I can scale it now. Because it's really about, you know, can you take your cost of goods plus your marketing cost...
• 27:22
  And then can you have a little leftover, which could theoretically at scale cover your operating expenses, and then maybe a little leftover at some point that you could actually make a profit, right? Those are just your big buckets of the equation. And so, you know, at that point, I was just going, if I can have anything left over, you know, because when you're selling two pieces, and you get a dollar leftover, it's like not covering your operating expenses, but you're like, if I could do this, and then I can, you know, sell 100,000 pieces,
• 27:48
  I could have enough to cover OpEx. So that was really how it started. The second I knew that I could make money through conversion media, I just focused only on that. I scaled the business through Facebook. And that's how we started. Again, I don't know that that would work today because now there's a lot of competition around the same audience that you have. And so harder to kind of break out in a sea of conversation. But I think that's all new. As new platforms come up, that creates new opportunities.
• 28:17
  Absolutely. After that tipping point then, and, you know, obviously we're covering a lot of time here, but in general, over the last, you know, almost decade, what are the things that have evolved that work for you today in acquiring customers? Is it still Facebook and Instagram ads or are there new things that are performing for you at a huge scale today?
• 28:38
  I think Facebook and Instagram are still incredibly meaningful. I would never, you know, but over time, what happens is you need a diversified audience stream. You really can't be all eggs in one basket. They change an algorithm, you're in trouble. I mean, brick and mortar, I think that's the appeal that a lot of people maybe undervalue about brick and mortar. But it creates a new revenue stream. So, you know, of course, recently, we've been forced to close a lot of brick and mortar stores. Our stores are now open, but they were closed for a while.
• 29:06
  And I sort of look at it like, you know, it's almost like playing hangman, but it was like someone cut off my arms. I had to close my retail stores, but I still lived because I had another stream. And everyone's reaction from when I talk to people is, oh, I have to go get really strong in mind.
• 29:21
  True, but what if they change an algorithm or what if the cost to acquire gets too much? To me, my takeaway was not, I need to be all online. It was, I need to continue to diversify so that no matter what happens, I'm in a good spot. You know, I have a lot of people that rely on me for their jobs and you feel that responsibility as your company gets bigger. And I'm just like, I almost feel like if I don't do that, I'm being negligent in my business and everybody counts on the revenue for this company. So I think over time...
• 29:51
  you're looking for new ones. So brick and mortar is definitely a different way to grow the brand and audience acquisition direction. Partnerships. So people do strategic partnerships, different brands. We just did one with Bobby Brown. So brands where you think you share a customer and generally similar size brands. I sort of say that to people who are getting started. I get a lot of emails from people going, I just started this business tomorrow. Can we do a partnership? It's like,
• 30:15
  Probably not. Like, you know, and I don't mean that in a bad way. But when I got started, I partnered with small brands too. And we worked our way up. And as we had similar size audiences, we worked together. And that's really, that's how this works. Because it's all about like, can we create the win-wins between these brands?
• 30:30
  And actually, I feel lucky I grew up with a lot of brands, like their citizenry was kind of around the same time. And there was like, I mean, Janessa Leona is a friend of mine. And I feel like we chat all the time. And a lot of these brands that we've been able to do partnerships with over time, and they've all kind of grown up at the same time. So I actually think one of the most important things that you can do
• 30:50
  you know, assuming you are resource-strained, is to build a network for yourself of people that are sort of where you are stage-wise. One, it is tremendous support, but also you guys can, you know, if you're non-competitive businesses, but you do share audience, you can gain a lot from one another.
• 31:09
  That's so true. And I think everything that you're saying is so hyper relevant to the landscape today where I'm hearing lots of brands, you know, having so much troubles with their Facebook and Instagram account. You know, even my husband, he has a performance marketing agency and he's like, all of a sudden, like more than ever, you know, your accounts are being questioned and violated and banned and all these things because they're changing the algorithm so quickly. And, you know,
• 31:35
  you know, the political landscape is changing. So the wording is changing that everyone's having to use. And it's, it's so crazy now more than ever to make sure that you have, you know, that diverse channel, different revenue streams coming in to keep growing and to keep alive. I love the hangman analogy. That's so cool.
• 31:51
  It's such a funny one, but I was thinking about that. I'm like, you know, during all of this COVID stuff, I just went, well, if they're going to chop an arm, I'm glad they took that one, you know, but that was not isolated to marketing or even audiences. Another way to think of it is, you know, my supply chain. It was a big issue with supply chain. My initial warehouse, every day, it was looking like they were going to close down. They didn't have the right to keep going. And
• 32:15
  So we were like, I guess I'm going to load all, I mean, this year I have a big company at this point that was like on the phone with my dad being like, I need you to bring the truck. I think I'm going to be putting all these boxes. I mean, we had a lot of inventory at this point moving, you know, and I was like, I don't know if they shut us down. I might have to start fulfilling from my garage because like, I need to keep boxes going out. You know, I got to keep going. And I mean.
• 32:37
  I learned a lesson on my warehousing. I have to be with a partner that has certification and maybe has more robotics inside of it so that if people get sick, it can go anyway. Because I think maybe Amazon's conditioned a lot of us to expect a lot. But your customers are not willing to wait. It doesn't matter what's going on in the world. They're like, I ordered this 2 days ago and it's not here. Yeah.
• 32:59
  I think that's when you want to serve your customers and you want to deliver into even high expectations, even at times. So, you know, for me, it was like warehousing. And then when you thought about more supply chain as it went to factories, you know, China and Peru, they were dealing with COVID in a big way, too. So I was like, I need to make sure that I don't have all my eggs in one basket. You know, that's a real risky thing to do. So, again, I think diversification, and I mentioned it in marketing. I mentioned the partnerships, Facebook, Spritz, Crick and Water Retail.
• 33:29
  Certainly other ways. I even think within your own marketing funnel, making sure that your revenue is coming from different activities. So making sure retention is part of the conversation. Or you do have flows, like email flows for people if they bought this hat, but the hat looks great with the sweatshirt.
• 33:45
  After they bought the hat, maybe like three weeks later, did you show them a picture of the hat style sweatshirt so that they can see that it looks great together? You're trying to make sure that you don't have to go buy a new customer every time you can look at your customer and be like, I'm building a full alpha for you. You know, like, this is awesome. And so really going like, am I maximizing this sort of value out of my customers and making sure that I can show the full breadth of what is possible?
• 34:08
  from Luna. And so, you know, retention, or we think about e-com, you know, making sure we're looking at that website and thinking about, are we maximizing our SEO potential with articles and with the wording that we're using? Are we checking our conversion rates? Is our wording correctly? So when people buy things, is it what they expected? Does the imagery match the product? I mean, the amount of things you can obsess over. As the companies get bigger, what happens is none of the actual functions change. You just get like,
• 34:37
  way deeper into each one of them. And you're just you're like, dialing all the knobs in the background, dialing all the knobs. I love that. Gosh, crazy. Where is the business today? And what does the future look like for you?
• 34:51
  I mean, it's been a crazy year. You know, March was probably one of the worst months of my professional career. I had to do layoffs, had to do all the things that you've heard a lot of people had to do. So obviously, I wasn't alone with that. But it was really tough. I mean, our revenue went, it dropped into a third overnight. So, I mean, we were just batting down the hatches. We had no idea what was going to happen, but we were there.
• 35:15
  And then April, the demand started picking up. And I mean, it was like crazy, you know, really started picking up to the point where I was running out of product because my manufacturers had been hit by COVID too. So I was really late on a lot of shipments. So anyway, it was wild. So since April really picked up and we had a strong summer. And then it's, I think we're in, you know, we're in the right place at the right time. So we've had a good, I mean, I should be like knocking on wood as I'm talking to you, but I'm incredibly grateful we've been,
• 35:44
  We've had a great year and not just that. I think we've had a great year and we're also the right products at the right time in the right place. And so I'm certainly benefiting from things that, you know, like I said, I had this thesis that would go one way. The world didn't quite, the path to get there wasn't exactly what I thought it was going to be. But I feel very lucky that, you know, I know a lot of people that are, of course, not in this position. And I feel lucky that I, of course, you know, that I can be here and still be doing quite well.
• 36:14
  Absolutely. And I know you have some other extracurricular activities that you've got going on. You're a busy lady, it seems. You are chairwoman of Outdoor Voices and you're also part of Girls Inc. And I think I read that you built a school with them a few years ago, some crazy stuff. Can you tell me about those other things that you're doing that, you know, have real impact and are meaningful to you?
• 36:39
  Sure. We'll start with The Deep, which is another company that I started. I want to say it's maybe a year and a half ago that I started that. And I have a co-founder with that, this woman named Kate. And that is a business that I started because I was worried about where I felt like the world was headed.
• 36:56
  I thought we were heading in a place where, you know, incredibly polarized environment. I mean, it's funny, again, now, here we are, like, obviously, it's polarized now, because we all just came out of that election. But this was like a year and a half. And I was seeing it in the workplace. I was seeing that I felt like we couldn't talk about things. So even in an effort, and I say this as, you know, as someone being in California, and I was, I'm in a very progressive environment here. But I was seeing that, like, right, but if you had a different point of view than that, that was not welcome.
• 37:22
  And then I was seeing the same thing happening on the people right now. I was like, this is scary. This is a world where we're like, we're almost scarlet lettering people who don't agree with us in a country that prides itself on freedom of speech. And I was watching the kind of dialogues people were having online, just the canceling that everyone was doing when someone didn't agree with them. And it's scary to me because I read about the French and Russian revolutions. I don't know. Like...
• 37:47
  it felt familiar, to be honest. You know, I looked at that and I was like, this is not something that is unique in the US. You have, you know, I was like, this is almost like we're becoming a boiling pot where we're just trying to figure out who to blame, you know, for why things are bad. And it was concerning to me because I was seeing in politics where I was seeing that, you know, okay, wow, we can't,
• 38:06
  even get anywhere because we're not okay with dialogue. Like, I mean, a silly example, on the political side of it was, you know, that if you looked at the immigration bill that had come from, that Obama had proposed, it was almost identical to the immigration bill that Bush had proposed. But neither...
• 38:23
  was willing to get like neither side, the Democrat or the Republican Party, wasn't willing to give the other party the political win, even though they actually kind of both had clearly come to the same conclusion. And so what I felt like is we're creating this society where we're more focused on, you know, like kind of like alienating one guy, you know, or girl or whatever, but like alienating somebody or...
• 38:44
  saying that they're wrong or being morally superior than we are about dialogue and progress and having intellectual conversations. And what happened was I started this company, The Deep, with an intention of helping people through that and having it be fun again. I mean, people like, you know, if you look at like old world salons and like, you know, in France back in the day, it's like people would debate politics. That would be not even just politics, they'd debate all sorts of interesting topics. And
• 39:11
  it was what, you know, educated, thoughtful people did. And so I was like, Oh, maybe I could be part of this, where we change the way we look at change, or, you know, where we don't go, this person used to think this, and now they think this, you know, they're horrible. It's like, actually, we should be saying that's incredible. Like,
• 39:28
  This person was open enough and curious enough that through question and examination, they changed their view. Like, isn't that what we want? You know, and so really, I thought The Deep was a really fun way and people like love it. It's on Instagram. If you go to thedeep.life,
• 39:45
  People love it because you can go check it out. We ask these crazy questions for people every day, questions you never thought of. It will probably freak you out. We usually don't go for the questions that you think. You know, you can go for, I mean, a silly example of this, you could take like a hot button topic, like abortion, something that people would be like, I have a definite opinion about it. I'm against it or I'm bored or whatever.
• 40:06
  But actually, like around that topic, the reason that people might feel what they feel, actually, there's so many interesting topics. Like, when does life begin? Is it fascinating? You know, we can go into that and be like, is it about when you breathe air? And then we go, well, if you're on a life support machine and it's breathing air for you, are you technically dead? You know, so we'll go down these like fascinating like rabbit holes with people.
• 40:29
  And what it does while being fun, because it helps you examine what you really think versus having like a knee jerk response to something that maybe you thought you thought, and like gives you the opportunity to honestly see gray area. And so I had a dinner party with it, it was super fun. We have a card game, you can buy it. And I remember we got through like a handful of questions. I don't even stay up past like 9 p.m. It feels so refreshing to talk to people
• 40:54
  beyond a surface level. And so that's really where that came from. And I'm obviously very passionate about it. So that's the origins of that one. And then Outdoor Voices, I got involved with this year. I've been a longtime fan of the brand. And they were in a place where they were looking for support, both like financial and operational. And given my background at Lunia, it was sort of a great opportunity for me to come over and help a little bit.
• 41:21
  It's been an incredible journey. Honestly, I feel like it's my second MBA, like the opportunity to get to do two of these at the same time. So I've been like intermittently kind of holding down the fort there, but lets me see so many, like learn about myself, learn about the business, play with different ways to approach things because there's different teams. And so it's been a really great learning opportunity. And I'm just really proud of that team and also the incredible progress they've made. It's just unbelievable.
• 41:49
  So cool. Wow. You are just all things happening for you. A lot going on. Yeah. And then Girls Team, I actually am not working with at this point right now. I've been kind of less with less work with them this year. I did some work with Sola, though, which is a Las Vegas organization. They did this really great fund that we helped them create, which is for people.
• 42:11
  During COVID, a lot of people lost their jobs, but also a lot of those jobs are not coming back. And so we had this really cool fund that we got started with them to help. And this was through NOCO3, but to help retraining. So basically put together a scholarship fund. Actually, Oprah ended up joining that and a bunch of great people ended up joining it.
• 42:30
  And that ended up being a great opportunity for people to go completely reeducate themselves while they were laid off from work and get a lot of them getting nursing degrees. So because we knew that would be a growing field. So if you lost your job and probably not going to get it back, it gives you a chance. It's sort of a new start. So that's been a really fun project. Wow, that's awesome. That sounds so amazing. I love that. Very cool. What advice do you have for women who have a big idea and want to launch their own business?
• 42:59
  So I almost feel like I should come up with a new answer to this question because I say the same thing every time here. But I do like, if you Google the hedgehog principle, I like it as a nice framework. I like it because it basically says you need to have passion, like an incredible drive. Because as I said, the entire experience will be sort of like getting punched in the face and two steps forward and one step back. So you need to wake up every day with like, I will not quit.
• 43:26
  Nobody will determine you're going to need like an unbelievable amount of determination. So passion is an essential one. Usually that one I always see, though. It's rare that someone shows up and they're not passionate about it. Otherwise, they wouldn't have even gone to the trouble of like showing me a business plan. Yeah.
• 43:42
  You need a business model. You need a plan to make money. And I think this is one of those things. And I don't know if this is a woman thing or not, but sometimes I feel like people, they feel weird about that. You know, building a business, it's not a hobby. Explain to me how it's going to make money. And there needs to be a real argument for it with justifiable evidence. And, you know, like, how are you...
• 44:03
  What's your thesis? How many do you think you're going to sell of whatever you're trying to sell? And why? And what, you know, what's your, like, you need to build that plan and you need to have a story behind it. So I definitely think that's the other one. And then differentiation. Why can't someone else just do it? Why are you, or why is your idea something that only you can do? And so I love that for new business folks that need sort of a framework. And I think that can be a really nice place to start.
• 44:32
  Love that. Thank you so much. I finish every episode with six quick questions and I'm conscious of the time. So I'm going to fire them off and keep steamrolling through. Okay. Question number one is what's your why? Why do you do what you do?
• 44:47
  I don't think my why has changed that much, interestingly, from when I first started. I think that weirdly, a lot of it is around kids. You know, I want my kids to see me as a contributor, as an independent person. And as someone that, you know, maybe when they get older, they can call and, you know, they feel like I have valuable experience, insights. I mean, there's a strong motivation for me around, like, how am I showing up for my kids? I love that.
• 45:16
  Question number two is what do you think has been the number one marketing moment that made your business pop? I don't know if this is, I mean, the number one thing that like probably drove revenue is conversion ads. And I have like some great silk video ads that do it. But I'd say the one that put our brand on the map was we did this incredible campaign about the whole, we did black and white text.
• 45:42
  And we did billboards and benches and sides of buildings and everything. And it was all about not buying sleepwear. And it would be like, I don't buy sleepwear because these holiday pajamas make me feel festive all year long. Or I don't buy sleepwear because these sweats were the best thing I got out of my last relationship. Or like, I don't buy sleepwear because how else would you know I ran a 5K 10 years ago?
• 46:06
  So we like kind of looked in people's closets, so to speak. And we're like, what is she really wearing? And does she think about that? And why is she wearing it? And it was so fun because people related to that because they were all kind of with their own outfit. And they're like, oh, God, like it was so good. So that was definitely one of my favorites.
• 46:25
  Oh my gosh, that sounds so fun. It makes me laugh because my pajama shirt at the moment is like this T-shirt that's like, I think it's like 4XL. I got it in the Bahamas four years ago and like it's been through the wash with black things. So it's like changed color. Like it's not the cool, fun, bright tie dye that it started out to be. Yeah, it needs to go. So funny. Question number three is where do you hang out to get smarter? What kind of podcasts do you listen to? Books that you recommend? Are you subscribed to any newsletters that are fab?
• 46:55
  So I really enjoy Lean Lux for industry press. And it's probably one of the few that I, I mean, I subscribe to a number of them, but it's the one I really give the time to, certainly in my field.
• 47:09
  And I'm very, I'm lucky because like when I think about who I get smarter with, I have an incredible C team that challenges me and helps make me smarter. And I have a bunch of advisors that do the same thing for me. And I have a husband who's an entrepreneur who does the same thing for me too. So I think in some ways I have a network around me that is really helpful in that way. Yeah, I love Lane Lux. It's a really good one.
• 47:35
  Question number four is how do you win the day? And that's around your AM and PM rituals that keep you feeling happy and successful and productive. Yeah.
• 47:44
  Well, so it should come as no surprise that I do change my clothes between, you know, I do believe in the nighttime ritual. I think, you know, there's a reason why you go to school and they have you wear, there's like a reason why uniform school uniforms exist. I think the idea is it puts you in a different headspace. And it's like you suit up to go into the office. The metaphor there is.
• 48:07
  is obvious, right? It's like, put in, you know, what do they say just for the job you want or something? But it's like, to me, you know, creating a distinction between the daytime and the evening time, it helps shift my mood because it's very hard. I find for me to, um, go from this hardcore work mode into like, mom who wants to have a good time and joke around with her family, like that transition really hard. So, you know, definitely, um,
• 48:31
  That's been a really big, you know, for me, almost creating that ritual around it has been really great. And, you know, whatever, glass of wine, CBD, whatever you need to do. But I'm sort of a, I think you really do have to shift mindsets. I read a lot.
• 48:47
  And I sort of have this new rule for myself where I read things I enjoy. I used to read business books. And I got to the place where I was like, I work all day. And then at night, I like take care of my kids. And then I go back to reading business books. Like, I can't do this. Like, I feel like I'm on a hamster wheel. And so I shifted that book for historical fiction, which is my favorite. And I'm just, it's so helpful.
• 49:09
  So that's another one. Also, like, I'm very into nighttime routine around like lotions. And I have this like, really great, like light thing that I put on my face. So I have like a whole bunch of things that I do for like, sort of beauty, but like restorative skin relaxed kind of thing.
• 49:26
  Sounds heavenly. Totally get you on the book front. I feel like historical fiction is so my jam. I read a really good book recently, City of Girls by Liz Gilbert. Such a good one. Okay, I'll check that out. Set in like the 40s. It's just, it's fun. It's easy. It's so great. You might like it.
• 49:44
  I'm going to take a note of that. I put all the ones I read on my Instagram because, and I usually like, I follow some other friends who do the same. So we're kind of sharing books on there, but it is, um, it's so fun to be like transporting, you know? A hundred percent. Totally. Question number five is if you only had a thousand dollars left in your business bank account, where would you spend it? And that's kind of to show like, where's your most important dollar spent? I was going to say, I'd probably close the door, but yeah.
• 50:11
  Thousands, not very much. Thousands, you're in trouble. But to your point, where's my highest value spend? I would spend it on, I mean, I'd spend it on conversion marketing, spend it on Facebook because it's, you know, I spend a dollar there and I'm going to get at least two back. For sure. And last question, question number six is how do you deal with failure?
• 50:33
  Um, one step in front of the other. I mean, I can't even tell you the number of times I either have failed or, you know, a lot of just chatting to my husband about this, but like a lot of it is I have this like icky feeling in my stomach that I carry a lot just of like worry about things about employees, about, you know, just like when's the ball going to drop? Cause you, after you've done this for a while, like enough things have happened, they start to just kind of like carry it with you. Um, yeah.
• 51:02
  But I think the reason I've had success is I just keep putting one foot in front of the other. I just think it's, and I sort of mentioned that early on, it's like, be prepared to be relentless. It will try you. It will push you. I have been pushed to places...
• 51:17
  I never thought I'd go. I mean, there was a while there I didn't, I mean, I would not sleep for like, I swear it was weeks on end. And I mean, to the point where I got scared, I like had to stop driving. I was like, I can't figure out how to sleep at night. And I can't operate the car. Like I was like, really in a bad place. So it's like, I just keep going. And that's, I think the thing is just like, even if it's a small step, it's just like every day, just keep going. Totally. That's so true.
• 51:48
  Thank you so much for taking the time to be on the show today and sharing so many learnings from this incredible business that you've been building and who you are as an entrepreneur. I really enjoyed it. Well, thank you so much for having me. And thanks for your great questions. It was super fun.
• 52:05
  Hey, it's June here. Thanks for listening to this amazing episode of the Female Startup Club podcast. If you're a fan of the show and want even more of the good stuff, I'd recommend checking out femalestartupclub.com where you can subscribe to our free newsletter. We send it out weekly covering female founder business news, insights and learnings in D2C, and interesting business resources.
• 52:30
  And if you're a founder building an e-commerce brand, you can join our private network of entrepreneurs called Hype Club at femalestartupclub.com forward slash Hype Club. We have guests from the show joining us for intimate Ask Me Anythings, expert workshops, and a group of totally amazing, like-minded women building the future of D2C brands.
• 52:52
  As always, please do subscribe, rate and review the show and post your favorite episodes to Instagram stories. I am beyond grateful when you do that.
• 53:09
  Hey, it's June here. Thanks for listening to this amazing episode of the Female Startup Club podcast. If you're a fan of the show and want even more of the good stuff, I'd recommend checking out femalestartupclub.com where you can subscribe to our free newsletter. We send it out weekly covering female founder business news, insights and learnings in D2C, and interesting business resources.
• 53:34
  And if you're a founder building an e-commerce brand, you can join our private network of entrepreneurs called Hype Club at femalestartupclub.com forward slash Hype Club. We have guests from the show joining us for intimate Ask Me Anythings, expert workshops, and a group of totally amazing, like-minded women building the future of D2C brands.
• 53:56
  As always, please do subscribe, rate and review the show and post your favorite episodes to Instagram stories. I am beyond grateful when you do that.