The Hunt for the How
Season 1 Episode 3: Operationalizing purpose with Fran Dunaway
From climate change, DEI and social justice, to economic inequality, worker safety and related issues, leaders are looking for guidance in addressing key questions as they lead their businesses into a future propelled by change and opportunity. In conversation with notable business leaders, Michael Dix, CEO of Intentional Futures hunts for the how.
Edited for length and clarity
Michael
Our guest today built a multimillion-dollar purpose driven company, TomboyX, from scratch in her garage with her wife, Naomi Gonzalez, who incidentally is watching the puppy as we record this, so providing a great service. Thank you, Naomi. Fran Dunaway is an advocate for sustainability, equity and entrepreneurship and a respected businesswoman. Fran, we’re excited to have you on today. Thanks for joining.
Fran
Thank you so much. I’m happy to be here.
Michael
Let’s start with you and your personal journey to become an entrepreneur and creating a unique company. I think we can go all the way back to just your career and how it developed over time. And then where you got the idea for TomboyX and sort of how you grew the company, that would be great context for everything else we want to get into.
Fran
I think I came out of the womb a boss. And that has been something that I’ve always been kind of in charge of things and, managing, I like to call myself a compassionate control freak. At the end of the day, I always found myself in leadership roles. When I was working on my master’s degree in AI, at first, I was trying to decide whether I should get an MBA or whether I should get a Master of Education, because I didn’t really want to enter the business world, I wanted to get into more purpose driven occupations. So fast forward, I ended up working as an administrator, and then an Executive Director of the Human Services Agency, up in the Washington State area. We ended up with, I think, 40 employees and 60 clients. I sold everything at 30 and went to film school. And my entire class wanted to be directors and I wanted to be a producer, because, again, I wanted to be in charge.
Michael
Can I interject? Why did you sell everything? Why the pivot at age 30?
Fran
I was tired of the bureaucracy of the nonprofit world. I loved working with the children and working with programs. We ended up specializing in autism, which was exciting for me, but it was so much in terms of the bureaucracy and the system, and it was hard. And it was frustrating. I really wanted to tap into my creative side. And so, photography has been a passion of mine for my entire life. And I decided to come home from vacation one time, I’m going to do it. I’m going to sell everything and pursue a dream. It was a yearlong program hands on, I like to learn all the different pieces. I know how everything works. I’m very curious about that. And then I got into independent filmmaking, did some documentary work, some travel shows, it’s a gig economy. I started working every political season, I would work for a political firm, producing ads for Democrats nationwide. And that eventually evolved into a full-time job, which then evolved into my becoming a partner in a firm. Our focus was on media strategies for politics, and I did that for about 13 years.
But I was frustrated, I like a button up shirt. I like a fun button up shirt, like a Robert Graham or Ben Sherman. I just prefer that to a knit. And so that was something that I kept complaining about my then girlfriend and now wife; she said, well, how hard can it be to start a clothing line? Let’s just make the shirt you want. And so that was us. That was her pushing me over the cliff. And together we took the leap.
Michael
And when did that inspiration strike? When did the push happen?
Fran
The push happened really in 2012. And we started developing the shirts, so we worked on that for just over a year. And we launched a Kickstarter campaign in March of 2013. In order to pay for the shirts, that was kind of a side project that we were going to run out of our garage because we didn’t have any particular desire to become entrepreneurs, so to speak, and we were just fulfilling a need of our own personally. We actually had great jobs, we loved our careers, and we loved paychecks and vacations, and all the perks that come with being able to rely on a paycheck. Jumping into entrepreneurism, we kind of toss all of that aside, eventually it took some time. It was very accidental to become an entrepreneur.
Michael
I want to dig in a little more into the evolution of TomboyX. Just to start things off, where are you now? And this idea about a shirt that would be what you wanted, personally? And where have you gotten to today?
Fran
Well, yesterday, I got word from Inc. 5000 that we are on the Inc. 5000 list of fastest growing companies for the fourth year in a row.
Michael
Congratulations.
Fran
Thank you. We have about 34 employees, and I think we’re hiring four or five. I have four job applications open right now. We’re growing quickly. We closed some Series B rounds of funding a couple of years ago. We’re really focused on continued growth. And, you know, we’re driving ourselves to become a household name. And in terms of revenue and profit. Yeah, this will be our first profitable year, we hit 24 million in revenue last year. We’re focused on continuing to hit 50%, or better growth year over year.
Michael
Congratulations. That’s a watershed. And how about the product line? How has that grown over time?
Fran
Oh, my goodness, well, we no longer make shirts and blazers, we pivoted into underwear. I love to say, we started this underwear company because I wanted a cool button up shirt. And that’s the truth. You know, the name Tomboy, really resonated in a very powerful way during our Kickstarter campaign, I think because of my experience in politics. And we really, accidentally again, stepped into a whitespace of an unmet need of a demographic of cis female customers that wanted something and had very specific desires. And it turns out that the first thing that they really wanted us to focus on was making the first boxer briefs for women. We listened and paid close attention, and we launched the first line of boxer briefs for women in September of 2014. We didn’t have the money to pay for them. So we pre-sold them two weeks prior to their arrival, hoping we could sell half of them. And lo and behold, we sold out. Six months later, we tripled our revenue. And we started realizing that we were probably an underwear company, and it might be time to pivot.
Michael
That’s amazing. I love the notion of a pivot and that it was rooted in listening to your customers and what they really wanted, despite your longing for shirts.
Fran
Absolutely. And the thing about whitespace or an untapped market is that they’ve got pent up opinions and ideas. To this day, we actively tap into our customer base so that we can understand what their needs are because they continue to have all of our best ideas.
Michael
That’s awesome. I want to come back to that in a minute. In a past conversation, we talked about your journey going from, and these are your words, I think “anti-capitalist”, to becoming a believer in capitalism’s ability to address a lot of inequities in the world. I’d love to hear a little more about that from you.
Fran
Yeah, that’s exactly right. Both Naomi and I have been in very purpose-driven occupations because we really have a strong set of values around making a difference and making the world a better place. And I didn’t perceive capitalism where at least my own endeavors into capitalism to be something of any interest. I didn’t feel it would be very fulfilling. And so yes, we’ve come full circle now that we took the leap into a capitalistic endeavor, but we based it on our values, we made sure that our values. They’re continuing to be imbibed into the core, the DNA of the company.
We made a very conscientious, thoughtful decision that was something we would not waver on, we wouldn’t make sacrifices just so that we could make more money, we wanted to make sure that we were treating people right, that we were using sustainable fabrics and practices and that our values are true. I see capitalism as a great way to address many of the inequities that we see in the world both among gender and race. And so that is kind of my next soapbox and I’m excited about helping people who look like me get more economic equity.
Michael
It’s inspiring, and I want to probe a little more about the values, your purpose, the purpose of the company, the values that you say, guide your decision making. And how intact was that at the outset in your accidental entrepreneurship journey? And how has that evolved over time? How does that come into play, as you’re making critical decisions about the business?
Fran
At the beginning we were so grassroots, and it was just Naomi and me. And then we were able to find this amazing person, Julie Naomi, who joined us, and made the first boxer brief for us, she’s still with us today. But we all agreed on our values in terms of making sure that our factories were taking care of their employees paying fair living wages, and working with sustainable, EcoTex certified fabrics, and at all steps of the way were making sure that they were just kind people.
Up until about a year ago, we were working with all female owned factories, it wasn’t as though we went out trying to find female own. But it turned out that the factories that we most aligned with in terms of our values, and ethics, happened to be female owned or run so we still work with those three factories, we’ve just continued to add to them. We have, you know, vendor statements around our values that they must agree to. We’re working on becoming B Corp certified. So we’ve upped our commitment and our validation of that commitment.
Michael
Hmm, that’s great. It sounds like you were selective intentionally about partnerships, supply chain partners, which are a critical stakeholder. And now you’ve taken it further to having actually a signed statement saying we commit to these values. And what’s the reaction from your partners, when you put that piece of paper in front of them?
Fran
You know, it’s most of the bigger factories that already have something like this in place, and the ones that we’re working with, because we’re selective in where we start. And then some of the smaller factories that it was more of a handshake, we’re asking for more certification. And so they’re having to step up to the commitment of going that extra step and getting an outside agency to validate that they’re paying fair wages, that there’s proper lighting, that in their hours there’s adequate lunch breaks, and all of the things that make the workers okay. And the way we did that in the beginning was we would go and visit the factories. And then Julie would go over every quarter, pre-COVID. And we were there one of the first times that we ever went to our first factory. And she literally walked around to the back of the building, she was pulling boxes from under tables to check to make sure they weren’t hiding anything. She just was a total badass in her approach to it. When you’re just showing up and you’re very clear about what your expectations are, they step up and by the same method, we fired a factory one time when we had expanded into two factories.
So I think that continues to be important but also today we look at what other companies they’re working with, and that is a helps us really know if we’re in a factory with a Patagonia we feel pretty confident that they’re going to be taking care of the planet because Patagonia I’m sure, has gone in and done the things to ensure that. That’s really what our goal is, to think about the planet. To think about not creating fast fashion, but a product that lasts much longer.
Michael
That’s awesome. And who else do you identify as critical stakeholders for TomboyX’s long term success? You’ve got your supply chain partners, which we’re just talking about, who else do you consider?
Fran
Well, we have a wonderful venture capital firm that is also B Corp certified. And they’re based in the UK, and they really do share our values around sustainability and thinking positively about the impact that we’re leaving on the planet. And I can’t say enough about how fortunate we are in that partnership. Also, of course, our employees and not only how we treat our employees, but how they show up at work and for each other. And so it’s something that we talk about, and we try to cultivate as much as possible, through transparency, through conversations, through a more flat hierarchy and taking responsibility for different roles in KPIs so that we can hold each other accountable, but also making sure that that we pay great wages and offer great benefits.
Michael
Great, let’s build upon that, because I know that you engage employees, you listen to them, you engage them and that social issues are an important part of your purpose. You want to promote those, but also that every employee comes in with their own interpretation of what your purpose is, and their own preferences for what social issues matter most and what positions to take. So how have you navigated that over time? And what would your advice be to any other entrepreneur or businessperson?
Fran
Wow, yeah, it’s been really fascinating in terms of the development or the growth and the transition from what we were and where we are now and where we’re going. And part of the enthusiasm for the brand and what we represent, is what attracts people to come and work for us. With that comes a certain ethos around what the expectations are. And so we’ve had some interesting internal conversations and debates around exactly that. You know, at what point do we take a stance? And at what point do we not. We typically haven’t become involved directly in candidate politics, but we certainly have supported a lot of campaigns and in organizations, and got very involved in the BLM movement, and we’ve stood in support of Planned Parenthood, ACLU. We give a lot of money and products to organizations for LGBTQ+ people and services, and the homeless. We get involved in things that we care about, but it does present itself in interesting ways. Because people are so excited and love the brand and what we stand for that they bring their own notion of that into it.
Michael
Can you think of any examples where that was really challenging where there were tensions or hard tradeoffs? That you had to then manage the expectations, hopes and dreams of employees in some difficult way?
Fran
I remember we had a challenge with a print. We have a lot of customers who wear uniforms to work every day like firefighters and police officers, and people who wear scrubs and chefs and athletes, so a strong core of our customer falls within that. So we did a commemorative print one year, and oh, and military, we have a lot of people in the military that are customers. We did a print one year and we had emblems from all the various organizations. And this was several years ago, probably in 2015 or 16. And we had a shield from a police officer shield along with a military insignia on firefighter emblem. And so it’s just a toss, print, kind of feel.
We got a lot of push backs internally, from some employees that felt like we were being pro-police. And then we got some pushback from people externally. I had several phone calls with some of our customers who were outraged by it. But by the same token, we got some very endearing thank you notes from people that were grateful that we included them and saw them. I have personal friends. And in fact, one of our friends was one of the people who helped inspire us to make boxer briefs and she’s a police officer. And so that was more what we were trying to do is recognize that there are people of all walks of life.
Michael
I mean, it sounds like the value of inclusivity was more important than specific positions, and boxing out categories of people based on their occupation, that makes a lot of sense. How did that sit with folks? Did they get it? Did you just live with the fact that some are going to disagree, but this is our stance and let’s move on? Or did you reconcile that tension in their mind?
Fran
Well, I think internally, we had a good conversation. Like I say, I talked to some customers externally, we didn’t remove the print off our site, we chose to stick with it. You know, we continued to hear from people that they were grateful that we had done it, it did help us articulate a process internally, so that people had an opportunity prior to the launch of a sprint to voice their concerns, so that we could have a conversation earlier on. And so that was one thing that we learned that helped us see that there was this gap in our process, that the product was doing one thing and marketing wasn’t aware of it until it was ready to go and people didn’t know where to go to voice their concerns. It goes live, we have some customers complaining, and that triggers people internally, and all of a sudden, we have an issue.
Michael
Yeah, that’s great. I think that’s such an excellent tactic and learning that, oh, maybe we had a little issue launching something that not everyone is aware of, then getting a reaction that stimulates an even stronger reaction internally, you could probably minimize some of that disruption by getting those that feedback and say, we heard you, we’re going to still move forward with this decision for these reasons. But thank you for your input, we want to hear it next time. And then you will get feedback of all kinds from customers and others.
Fran
Absolutely. And it also influences our messaging going out. So we have a strategy around how we’re launching it, how we’re messaging it, and why if I had that to do over again, what a great opportunity, it would have been someone from it. This was pre-BLM, but someone from the African American community would come and sit with a police officer and have a podcast or have some sort of a conversation in conjunction with the launch of this so that they could address the tensions.
Michael
I love that idea. Yeah, just go at it. There is tension, there’s disagreement. Let’s embrace that, and connect people and advance the discourse in a more productive way and set the stage for whatever product you’re going to be launching into the world. I’m just thinking about your journey as an entrepreneur, and I love where you’ve gotten to, and you’re paying attention to what you’re hearing, and you’re making adjustments in response to that. And that’s vital, it’s never going to be that you can anticipate all the problems you’re going to encounter in the future or the new ideas and opportunities. Going back to what I guess the two-part question, what do you wish you had done or had in place that you did in terms of crystallized purpose values, procedures, compacts with partners? And then what advice does that generate for tomorrow’s entrepreneurs who want to develop a successful purpose driven organization?
Fran
It’s hard to say, it’s always easy to see if I knew them what I know now, right? But as far as operationally, it’s just continually evolving, change management is critical. It’s powerful. And if you’re growing a business, you must be innovative and always changing. I think that also is true for the team that you’re building — where you are today may not be the team that is there for where you need to go tomorrow. So being fully aware of that, and recognizing that’s just an ongoing change management piece of how you do business and looking for the people that can be scrappy, and just make stuff happen because you can only afford a handful of people and everybody’s got to do multiple jobs, those are not the same people that are going to want to show up to a weekly Business Review, and speak to KPIs and metrics and, and tick all the boxes of what needs to happen. I think that’s true of a startup founder. In fact, you know, it’s hard. Most people can’t evolve into the CEO that grows the company, to multi billions of dollars, at some point, there must be a change just because of the skill set.
Michael
You said you came out of the womb a boss and I do remember you telling me that you were the one person in your film class, who elected to become a producer, not a director, because you had more authority and control over the larger picture and outcome. I think you said you’re empathetic or a compassionate control freak, which I love, you need a balance of both. I’m curious how you’ve been recognizing that change management is important, and that there are stages of maturity of an organization and may call for different people on the team, and maybe even a different CEO. How do you think about yourself and your evolution as a leader? Given your penchant for learning, and adapting, how close are you to tapping out? Are you comfortable evolving yourself as the needs of the company are evolving?
Fran
I’ve been a co-founder until the last couple of years, and now I’ve been trying to figure out how to be a CEO, and really focused on that. And then my wife, Naomi was the CEO. But we just have those titles, because that’s what you do when you co-found the company. She did run operations and whatnot, not to say that she wasn’t fulfilling the CEO role but had no previous experience. In fact, when we started the company, we didn’t know a knit from a woven or a P&L from a balance sheet. We had a lot to learn. And really, that’s what we would do. And it was interesting to me, especially in the marketing side of the business, because that was something we didn’t know much about. And as a direct-to-consumer company that’s an important part of our growth. And so we would hire someone to kind of head up our marketing efforts that knew more than I did.
I would get to the place where I knew as much as they did and could see them down the road of what we needed. I have regular conversations with our board of directors about when you feel like you know, I’m of no use. And so far, they’re saying, I still have value, so I’m sticking around for now. But we did hire a CEO last year to replace Naomi, and Naomi is heading up our sustainability efforts and growth, strategic growth initiatives. And the COO came in with blazing guns and is doing a phenomenal job. So, her leadership will continue to be critical to our growth.
Michael
That’s great. I mean, it sounds very heads up of you to even pose that question to the board. I think most leaders would shy away from that. And sort of try to ride it out if possible. The very fact that you’re raising that question and being open to the possibility that others might be stronger, is maybe a signal of strength that speaks to the potential longevity, plus your willingness to adapt. So I’m really curious to see how that continues for you. One thing you touched on earlier in the conversation that I think it’d be worthy of examining more is the capital markets. And your experience in raising money, obviously started with Kickstarter. That’s a great way to get money, and kind of a demand test. You know, what customers want? And why and are they willing to express that through participation? But then you had to raise money and get a little more serious. What was that like for you? What did it tell you about how the markets work? And then who did you end up raising money from and what has that been like for you?
Fran
It was quite a journey. We felt that we had product validation, significantly after raising $76,000 in 30 days on the Kickstarter campaign. And we also didn’t quite understand the complexities of having inventory versus a SaaS product. A lot of these 25-year-old guys with this crazy software app idea can go out and raise a lot of money without any proven, viable product. It was really hard for us because we had inventory issues because our cash was always so low. And when we were early on, we got accepted into an accelerator program. And we were the first cohort of this awesome program called Merge Lane that was based in Boulder, Colorado. And within a week of being there, they pulled us aside and said, you need to raise money, you have a great concept, there’s a lot of buzz, even locally around what you’re doing. You should raise money, and we want to lead the round for you. And, and we didn’t know anything about that.
So we kind of dove into trying to understand what fundraising is about and learning the vernacular so that we could have conversations around valuations and whatnot. And so they lead the seed round. We raised, I think, just over 2 million over about a year and a half, it took quite some time, the commitment from them was in, I believe it was in March, or April. And we closed the first portion of that round, in August. And that was when we finally went on payroll after three and a half, four years, and, and we were able to hire a couple of employees, including the woman who had built the boxer brief, so then we set out having to talk to people. When you’re in your seed round, it’s angel investors. I had to get up on stages and do the whole Demo Day presentation kind of thing and a pitch deck. And prior to going to the accelerator, I had done a couple of competitions, kind of local Seattle based things, but we didn’t really know what we were doing. And that was one of the best things that came out of the accelerator was this beautiful pitch deck and beautiful pitch.
And so post Merge Lane, I started winning most of the competitions and quickly found out that we should just be talking to female investors, because male investors frequently would ask, well, what’s wrong with Victoria’s Secret. And so, since we were ahead of that trend, they just didn’t see it coming. I think they probably now have a better understanding of what is wrong with Victoria’s Secret. But that’s another story. So in our seed round, we raised 90% of our funds from female investors. Now female investors at the time, we’re trying to change that. That’s part of my next soapbox, but female investors write smaller checks, and they take longer to write a check. So that’s a trend I’m going to actively pursue on, you know, post CEO at TomboyX.
Michael
You mentioned at the outset that one of your investors is very mission driven and very aligned with you. Can you talk more about who they are?
Fran
The VC that led our Series B round of funding found us — we didn’t find them, we had just a year prior closed the series around the funding. And so when they approached us, I kind of gave them a cold shoulder for a few weeks. But then they convinced me to have a conversation. And what set them apart initially, from the very beginning was they asked for a Zoom call, or I think it was a Google Hangout call, which was pre-pandemic. And so most people were still doing phone calls or email and then it would drop off from there or pick up from there. And two of the people were part of our conversation and, and immediately within like, 15 minutes, I was like, oh, boy, I think we have another rainbow unicorn in front of us. And so, you know, rainbow unicorns have been the thing I call the magical moments along the way that have kept us alive and kept this moving forward because things or people appear that we kind of put into the ether asking for and next thing we know they’re there before us. We accelerated the process and they came on board and yeah, they continue to be great partners and continue to share our values and treat us with kindness and respect.
Michael
Yeah, I mean, that’s awesome. I love when the universe provides at key junctures. What made them a rainbow unicorn for you? Talk about the importance of having an investor who really is simpatico with what you’re trying to do and your value system.
Fran
I think it’s critical that people find investors that can meet you where you are, and not where they think you should be. The EQ to be able to do that is high. And that was obvious from the beginning that they were very founder friendly. Without being specific, I can say that we have had experiences with non-founder friendly investors, and have had meetings with non-founder friendly investors, and those are the people that want to tell you how to do it. They’re the people that don’t want to know what to do, don’t assume or ask any questions about how you’ve done it, or why, but just come in with a sense of knowing better. It was very clear that they saw what we were doing and why we were doing it and how we got where we were, and weren’t judgmental or condescending, but more they looked at it and we’re impressed and realize the potential of what we had. So they came in with a real value-add to what we needed, and challenged us in all the right ways so that we could turn the ship and get in alignment, so that we could put the accelerator on growth and really improve our performance.
Michael
That’s great. And just to get specific, what beyond money, do you value?
Fran
Well, when the founders of the fund set it up, they were UK based. They hired experts in different areas of e-commerce. So they’ve got someone that really understands digital, that was at Amazon for a long time, they’ve got someone who really understands CPG branding, that is creative. And then they have entrepreneurs, founders that have bought or built and sold numerous companies, so they understand the entrepreneurs’ journey. And then they’ve got someone that specializes in operations, and they’ve got someone that understands contracts and deal negotiations. And they also have an ethos of what I call a family office ethos, where they’re not just going to say you must grow for the sake of growth, and we must have an exit within five years, it must be 10.
Next, they believe in building strong companies that are values based, and that are making an impact on the world. And so that is a great alignment for us and in that we tap into them. I always tell the team, use them as a consulting agency, we’ve got free consultants there, you want help with a digital strategy, bring in this person, if you want someone to give you some feedback on a creative, we have that person, and the team loves working with them and utilize them on a regular basis. Now, that is not the norm. You know, there are a lot of horror stories out there — read any entrepreneur book and you can see where they’ve got into bed with the wrong bed partners. Things go awry quickly. We’re very fortunate. And that’s why this is a rainbow unicorn because they came along at the right time. And they’ve been wonderful partners every step of the way.
Michael
Yeah, it does sound special, because it’s not unusual for people to want to provide advice and direction, that maybe the difference is meeting you and trusting you, respecting your perspective and finding ways to provide value that’s going to work and also having a long time horizon. That makes a big difference. It creates space.
Fran
Yeah, it really does. Because then you can focus on building the business and not just having to grow with wild abandon. You know, being smart about the business we’re building, I’ve learned so much in the past two years, probably more than all the other years combined in terms of how to run an efficient business. And I’m grateful for that.
Michael
There’s another theme that I’m picking up on, which I’ve heard in the past which is trust. And this sort of tension between control and having a clear plan and trust and distributing power and decisions to others. Can you talk about that interplay as a compassionate control freak? Obviously, for you, it’s probably a constant battle to say when do I drive things? When do I empower and listen to others? But I’m seeing that show up in a lot of places, with your investors, with your customers, with your employees, supply chain partners, I’m sure.
Fran
Starting to enter the world as a boss, I think that really my talent is delegation. And so I don’t need to get into the weeds — I don’t have a desire to. That just doesn’t interest me, it’s not very exciting to me. And so I’m much more of a collaborator, I think that’s why I love film so much, as I like to bring people in, I like to understand how they do their job, I know how to do audio, I can shoot, video camera, I can edit, I can do all the things. And so that was the same thing. I wanted to understand different people’s roles and jobs, but pretty much stayed out of the way. And so that has been an ongoing practice for me. And there have certainly been stumbles along the way, or where perhaps I should have stepped in more.
But I think all in all, I look at our team today and our leadership team, and trust is the critical component of our relationship. I got to promote our CFO this year, he’s been with us for three years and started out as a VP of Finance, and it was probably one of the proudest moments I’ve had in the company. I was able to see his growth into that role and to be able to get him there. So that relationship is so critical. And then as we’ve added people to the team, for a while it was just me and Naomi and Ryan, we were the three that were out there, trying to drive the business in the company. And we’ve added some people to his flank. Now he’s got a COO, and he’s the CFO, and we’ve got some great VPs in place to help kind of drive the business. And it’s all built on trust and recognizing what each other brings to the table and not creating silos around, this is mine, this is mine, but we all talk openly. How are you thinking about that? Why did you do it this way, and then we have a conversation. And that just builds great trust, but also great leadership.
We really believe in servant leadership and want to bring that out in our team. We have regular conversations around the fact if we’re not being great leaders, if we aren’t creating a team of leaders. And if any of us were to leave, we want our team to be able to carry on without us there. And so that’s the ethos that drives us. And so when you have that shared vision and those shared values, it really makes work fun. And I imagine fuels trust because you’re aligned.
Michael
So let’s go here, you’d mentioned Victoria’s Secret. And I think it’d be interesting for you to reflect upon their recent moves towards the direction that is in the territory you’ve staked out. They’re acknowledging the value of embracing everyday people and bodies of all shapes and sizes. And how does that look to you? Does that look authentic? Is it a cynical marketing move somewhere in between?
Fran
Yeah, I just wrote something about that. And I think the first line was, you can’t put lipstick on a pig. And you know, too little too late is what comes to mind in my mind. And the reality is Victoria’s Secret did a disservice to women. In that way, they created this unattainable beauty standard that caused a lot of shame and caused a lot of judgment and hardships for a lot of women and girls. Not to say that they weren’t built by a group of intelligent women, but the men behind it — it’s clearly a misogynistic culture. And so for them to now suddenly get it, it just doesn’t feel authentic, it doesn’t feel genuine, it feels more like a marketing ploy. They’re doing it for the wrong reasons, exactly the wrong reasons. We were always inclusive because we felt it was the right thing to do. Again, going back to that capitalism, it wasn’t to make a buck and I think it’s a thin veil that we can see through what they’re doing. It’s still just capital wanting to sell things to women and not really care. I don’t trust that they’re doing things for the right reasons. You can look at companies and see where they’re donating and where they’re giving back. I just don’t think you’re going to see much of them there.
Michael
Yeah, I mean, that’s exactly the way I saw it. I’m curious if you think it would even be possible for Victoria’s Secret, given their complicity in shaping the way we think about women and their bodies and the insecurities that they’ve provoked? Is it possible for them to redeem themselves and authentically shift?
Fran
Well, I don’t think the authenticity is there, it’s clearly a company that’s struggling and wasn’t paying attention to the times, and I’m certain ignored internal discussions that were trying to point them in the right direction. I’ve had discussions with former employees to that effect. For me, the silver lining of it is that, hey, even Victoria’s Secret recognizes what we’ve been saying for years. And, you know, go back to those guys who asked what’s wrong with Victoria’s Secret when we’re raising funds? Well, here you go. That’s what’s wrong with Victoria’s Secret. And so for me, it’s validation for the path that we’ve been on, and that we continue to journey down. And so I think it’s great in terms of the change that we’re creating in the world. That’s the positive side for me.
Michael
Right? It’s a positive and an indicator for you, even if their attempts are going to fail, or just marketing tactics. So what if you had one bit of advice, sort of a magic wand exercise to say, anyone who is running a business or forming a business, if they did this one thing, it would fulfill purpose, generate more value and more forms, or whatever positive outcome? What would that be?
Fran
I would just hope that companies think long and hard about their enduring impact on the world. What that means in terms of climate, in terms of people in terms of values, because I think together we can make an impact, and have made an impact. Industry has impacted people’s lives, everything from how people are treated, and the wages that they make to the impact on the environment. I think just being thoughtful about that, as founders, especially, but making a difference in the world, and how we go about doing that, and not just making a buck for the sake of making a buck. You know, keep things out of landfills and then focus on fit and quality, and a reason that you’re there. And I think that makes for a more satisfying business, not only for you, but for your employees and for your customers as well.
Michael
So one of the, in my observation, one of the things that’s been shifting over time is a corporate sense of responsibility. Now, CSR, corporate social responsibility is one thing. And I think, in its worst form, it’s sort of cynical marketing that compensates poorly for bad business practices and negative impacts. But it’s evolving, too. I think there are lots of examples where meaningful work and positive impact are coming out of CSR organizations. What we’re talking about is deeper and different in the sense that these are fundamental to how a business works, not sort of just a part of the business that’s responsible for being responsible. So the question I have is, what do you think about actual corporate responsibilities? I think they’ve been shifting a lot over time. I think even Nike and its supply chain, had an awakening a couple decades ago that oh, we are responsible for our supply chain partners and their practices. So we need to own that and be much more selective in the way that you already talked about doing. Where does it begin and end — your realm of responsibility as the leader of a business?
Fran
Before I get into that, I think that it’s important to recognize that the whole way we think about business and we think about shareholder value, I mean, the way that we put such emphasis on profit, and that is what has led to this way of venture capital funding and the way they think about investing in 10 companies and hope one is a unicorn, and don’t give a damn about the other nine, as long as that one makes it, then they’ve made their money, and the focus is on money. And the focus is on growth and profit. And really, if there’s another way to look at business, and there’s another way to evaluate business, and I think that’s the mindset that is changing. We’re seeing the younger generations helping us change, because they’re tired of the focus on profit and the value of money over anything else. That’s where you see this growing divide of the haves and the have nots. And so I think that it’s really a shift of mentality of how we think about what makes for good business. And if we start shifting to what makes for good business into what’s their give back, how are they treating? What is the impact that they’re making? How are they making products and everything that they do from supply chain into, into community giving?
I think it’s really a way of how we evaluate success and what we define as success. That’s a mindset that needs to shift in this country. I guess that goes back to the notion of capitalism again. How do we redefine what success is, and we’re seeing massive change in the past several years of a lot of venture capital companies that are investing based on values, and not based on getting that one unicorn, right. And so that is the world changing in that regard. I think that it’s critical, just from a human-human side of things, if you’re going to start a company, and you want to do it, just to make money, you’re kind of not part of the rising tide. And so you really need to think about the future of business as a whole. And then how you apply your values to what you want to build.
Michael
I love the notion of what about the other nine? And in a sense, what you’re saying is those other nine matter as much or more than the one unicorn, and if all of them can start operating in ways where they are cognizant of all of the knock-on effects, the intentional and unintentional effects of how they do their business, running their business, then that is actually what will lead us to a better functioning economy and society.
Fran
Absolutely. And if you know, what’s wrong with a beautifully built $30 million business that’s employing 30 people, that’s a great business — there’s nothing to say that that’s not a great business, and why can’t we support that more from the beginning and just rethink of how your investment might pay off for you, if you have that as your mindset. And so I just think it’s a better way to build sustainable, awesome businesses. And by the way, it’s more supportive of women and people in the BIPOC community. So it’s a win-win.
Michael
Awesome. That’s a great note to end on. Fran, thank you so much for coming on and sharing your wisdom and stories. It’s been enjoyable and fun, and I look forward to keeping in touch.
Fran
Thank you so much, Michael, anytime! I really enjoyed chatting with you.
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