“I think people relate to you a lot more if you show them the mess behind the curtain; the real thing, the real deal.” - Tamara Mellon

Checkout this week's new episode of #NoLimitsPodcast featuring shoe designer and entrepreneur, Tamara Mellon:

On today’s episode, how a high school dropout became the co-founder of Jimmy Choo. And why she made the decision to leave the immensely popular brand she started and start her own namesake label, Tamara Mellon. What Tamara’s learned about choosing the right partners in business, advocating for equal pay, and how to know when the time is right to pull the rip cord on a business. Here’s entrepreneur and shoe designer, Tamara Mellon:

R: Tamara Mellon. Welcome to No Limits.

T: Thank you! Very happy to be here.

R: I'm thrilled to have you with us. I was looking at your web site coveting all of the shoes, all of the boots. The beautiful things. But I love how it says co-founded Jimmy Choo 1996. 20 plus years later now still obsessed with shoes, but not doing things the traditional way.

T: No. Exactly. So even though I'm still obsessed with designing shoes and I'm still obsessed with quality, I still make my shoes in the same way in Italian factories that I did at Jimmy Choo but now I'm selling them in a different way. So the business model is totally different. I design no collections I just put new things up every month that are season appropriate. So we don't have to buy things in the wrong season anymore. You know traditionally we will deliver collections and you know 4 months ahead you know coats in July and spring, summer in January and February. Who cares. You know, you want to buy something today and you want to wear it tomorrow. And also because it's direct to consumer which means I don't have to have a wholesale margin in so I go from factory cost to my customer. So now my retail price is what my wholesale price used to be.

R: For the consumer, that means a lower price point but still that quality that people would assume they would be paying for.

T: Exactly. So I still produce the same quality as all my competitors whether that's you know my old life Jimmy Choo, Christian Louboutin, Manolo Blahnik, Gianvito Rossi, you know all those you know amazing shoe brands you know they're made in the same factories as everybody else. But but now we also charge half which is really exciting for me.

R: So you started Jimmy Choo as the story goes with a loan from your father, 150000 pounds. That's what I was thinking. Did your dad say you needed to pay him back because you called it a loan so it wasn't necessarily a gift?

T: It wasn't a gift. At that point it was a loan and then I think he realized that he actually made so much money in the business he kind of he's forgotten best. Yes he became the investor. So if you actually look at the history of Jimmy Choo. He's the only person that actually would have invested in the business. So first of all he gave me a 150000 loan which is probably $300,000 today and that's what we started with Jimmy and I became 50/50 partners. And then once we were up and running in the first year he saw it working and we had orders in that we actually couldn't pay for at the factory so then he put a million dollars into the company.

R: Was it called Jimmy Choo back then?

T: It was called Jimmy Choo.

R: What made you call it Jimmy Choo instead of Tamara Mellon back then?

T: That's a really good question. So when I was at British Vogue I was the Accessories Editor and in the early 90s the only shoe brand that people really were interested in was Manolo Blahnik. There wasn't all the shoe brands that we have today. There weren't all the designers doing accessories like they are today - the accessory explosion hadn't started yet. That started in the mid-90s. So I was tired of shooting one designer shoe so I found a cobbler in the East End of London called Jimmy Choo. And I would get him to make things for shoots so I'd go down to his studio, and I'd say hey Jimmy I'm doing a gladiator story can you make me gladiator sandal and silver metallic studs and I want the buckles here and I want this and I want that. He'd make it. I'd photograph it. And I'd put his name in Vogue. So that was my light bulb moment. I thought oh what a great platform to start a company on, the name is known but there's no business there.

R: At what point do you decide it's time for me to break off and do my own thing?

T: Well after 16 years and 4 private equity deals later with I think I think I did more private equity deals than anybody could do with one company. It was it was a lot. So after 16 years I decided to leave. And really there was, you know there was multiple reasons. One that I had been through so many private equity deals. The other one that I couldn't negotiate what I thought was a fair pay fair remuneration for what I was doing. And actually when I looked at my competitors in the business I was probably at a quarter of what they were making. So I decided I could either I could stay here another five years, or I could leave now and start from scratch again. And I also had the new business model in mind which I wanted to do I was very excited about that.

R: Your competitors primarily were men making shoes for women!

T: Making shoes for women yes which is also another crazy thing because people always say to me why am I shoes so painful they say, I'm so sick of being in pain. If you think about it, most shoe designers are men and they don't know what it feels like. So I actually know what it feels like to walk in your shoes on many levels.

R: And you're the fit model for the shoes.

T: And I'm the fit model. I do all the fit trials myself so I'm and I do not want to be in pain so I won't make anything that's painful.

R: And yet you do have heels on the shoes.

T: Yes.

R: On many of them.

T: Many and you know high heel doesn't need to be painful - if it's the elastic is correct. If the balance of the shoe is right, you know there's there's technical things you do to make them more comfortable.

R: So you decide to launch the brand in your name.

T: In my name.

R: Finally. That must have felt like a really big deal to be able to put your name on the shoe this time.

T: It did. It was you know it was really it was really exciting. It was also nerve racking because obviously for 16 years I’d been building Jimmy Choo. It's a brand name, you know a different brand name. It's risks because also you know what if it didn't work. Oh my God what it's like now it's my name. But but it was no. It feels really rewarding. The company's 18 months old now it's up and running. It's we see it's working. We see women really responding really well to the, to the product, the aesthetic the business models. So I'm I'm happy with it.

R: What's the biggest learning at this point going at your own?

T: The biggest learning so far is how much the industry is disrupted right now. So the fashion industry is going through what the music industry went through you know several years ago and now when you're building a digital business you have so much data so we can respond to what our customer wants so much faster and that is really exciting.

R: How do you collect that data? How do you learn what the customer wants?

T: Well we have so much just because we have a direct relationship with her so she's shopping on our web site. We are seeing, we can see now immediately which styles are selling. So if you think about how it used to work as a designer you design a collection. You go and present the collection at fashion week, a buyer comes and will cherry pick the pieces that they like, order it six months later it's delivered to the shop floor. They have it for six months and then they then six months later they come and tell you what your sell through was. So your feedback loop is a year.

R: Wow.

T: So I have feedback from my customers now within days.

R: You automatically know this style is working, this style has less interest. Do you know how real time are the decisions that you're making. For example if there was a shoe on the site that wasn't selling would you automatically say stop production on this or how do you think that decision through?

T: Well that has happened so we wouldn't reorder it. We would let it sell through. But when we see something's working we can jump on it and order it much faster. So a great example is the other day I wanted to make a press sample of our ‘Icon’ boot which is one of our bestselling boots.

T: But I wanted to make it an electric blue metallic so I thought oh my god be so great for evening wear especially around awards shows and people now wearing boots with evening dresses it's a new look which I love I’m kind of obsessed with it. So I said let's do this electric blue metallic ‘Icon’ boot. And then it came in and we put it on the office and everyone was like oh my God we love that. So I said OK well let's photograph it we literally shot it on me in the office posted on Instagram and said who likes this boot. If you guys like it, I'll put an order in right now. So everyone went crazy had like the most likes we've ever had like 5000 likes or something and we put it up for pre-order and well it's being delivered in a few weeks. So that's how much faster. And before the design process to shop floor was a year.

R: That… It's kind of crazy to me that so much of the fashion industry still works that way still works in the old school way.

T: It really does. And it's you know it's it's taken so long for them to even realize that they have to change.

R: Why do you think that is?

T: You know many when people are used to building businesses in a certain way they don't want to change right. Because they can't see the future they can't see how things are going to be disruptive until they get slapped in the face with it and that and that's kind of what happened in the fashion industry. Now everyone’s scrambling to think oh how can we go digital how can we go direct how can we build e-commerce. But you know it's it's kind of after the horse has bolted.

R: How do you think about crafting your message on social?

T: Well we tell all our stories through social. So we use Instagram, Twitter, or Facebook. But the most probably the one that's best for luxury is Instagram because it’s very visual. But we also talk a lot in our copy, we tell a lot of stories with our copy and I think copy and that's I think that's what's engaging with our customers as well the moment.

R: So tell me about the work you're doing around Equal Pay Day.

T: So we do have we do a great project every year. Last year was our first year and what we do is we give a discount depending on what the pay gap is between men and women. So last year it was 20%. And we do that really just to create awareness and awareness around the issue. So we were hoping this year that the percentage will be lower. But unfortunately it's still 20%, and it's the only time of year that we give a discount we never go on sale we don't give discounts because we're already great value. But it's the one day we do something to drive awareness around Equal Pay for women.

R: So you deal with celebrities to some extent. Take us behind the scenes pre-Oscars. What's it like?

T: It's pretty crazy. So I was the first British brand to ever go to the Oscars. I was the first shoe brand to go. And when I was trying to figure out how to do it when I realized was the stylists were running around. They were actually just buying shoes to go with the dresses. So I thought there's an opportunity there. I could go and just service them. So but I thought well how do we know what color to take, or what size. So instead of taking thousands of pairs of shoes in different colors and different sizes so I could have every option possible. I decided I took everything in white satin and I took everything in black satin. So the white satin I could die any color and I had someone sitting in the bathroom at the Peninsula Hotel in Beverly Hills dyeing shoes to go with dresses. And it's insane. It's craziness behind because you don't really know what they are going to wear. They don't want to tell you what they're going to wear in case it leaks. So stylists will come in with a tiny little swatch of fabric to show you maybe a color match. And people also change their mind last minute, the dress came in it didn't fit right. They've changed their mind. They want to go in a different direction so that suddenly like three hours before we've been dyeing shoes to go with dresses. People walked out with wet dyed shoes. You know it's it's it's really crazy but then it's kind of fun you get on it you know it's the adrenaline rush of it all.

R: How valuable is that to see your shoes photographed. You know somebody like Cate Blanchett or Julia Roberts wearing your design?

T: So that's it. That's another thing that you actually you don't have the data on. Right. It's not you don't see sales spike the following day because somebody wore something to the Oscars. But I think what it does it just gets name awareness out gets you into the psyche of people. I don't think it actually converts into sales.

R: Is there someone you would kill to see photographed in your shoes today?

T: Oh wow. There... I mean I love there are many people I'd kill to see yeah there was so many great girls I don't even know who.

R: What about Meghan Markle?

T: Oh love Meghan Markle. Yes of course. And then you know she's marrying a Brit.

R: She’s an American princess!

T: Yes. I love. Yeah. We've been watching that closely. So yes of course I'd love to see her.

R: All right then. I hear from a number of businesses and entrepreneurs this if you build it they will come. But then they don't come or people say they're so excited about your brand, but getting them to actually make that purchase. There's a big distance between the two. How do you foment that excitement and also make sure that people are truly consuming what you're creating?

T: So all our advertising now is digital you know which also converts immediately. And then I think brands today are very different in the stories that they're telling. You know before you know designers used to sit in their ivory tower and kind of dictate of everyone's going to be wearing red polka dots this season. And now it doesn't work like that anymore. And also there used to be. There was no direct relationship with the customer. So you would do an interview in a magazine, or you would do you know a newspaper and then a journalist would write the article and the designer would never talk to the customer. Now we have a direct communication which makes all the difference. You know people actually would rather hear real stories on people be authentic about their lives. Obviously I wrote a book “In My Shoes” where I told the whole story of building Jimmy Choo and I had my personal life weaved in and out and I was very honest because I thought if I sugarcoat my story it's not going to help anybody. You know and that's what designers always used to do they used to be all glossy on the front and then you'd never see the mess behind. Well I think people relate to you a lot more if you show them the kind of mess behind the curtain.

R: The, the personal life.

T: The real thing, the real deal yeah.

R: And when you pulled the curtain back, some of the things you talk about in the book you know your relationship with your mom for example wasn't a great relationship.

T: No, it was very very difficult. And I think that's you know a lot of people related to me because of that or I was so honest about so many different things whether it was building the business, my own drug addiction, having a very narcissistic mother you know whatever. I think it's whatever it was business or personal. People could relate some part of my story. So hopefully I inspired and gave people hope with some part of it.

R: Speaking of breaking with tradition so you were a high school dropout.

T: Yes correct.

R: Went to rehab early on in life.

T: Yes correct.

R: Had a relatively tumultuous childhood.

T: Yes.

R: Growing up all over the world Switzerland, Beverly Hills, London - what was that like?

T: So I went from England to L.A. to Beverly Hills and then I went back to boarding school in England and the culture was so different.

R: How did you think about the world back then did you think about yourself becoming a designer someday what was your dream job?

T: Well I've been obsessed with fashion since I was a little girl. So instead of playing with toys I used to play with clothes and even at boarding school. This is before I knew what a stylist was, I was doing makeovers, on my girlfriends so I didn't even know what I was doing I didn't even realize that there was a name for it. But I was doing that very early on and I didn't know what I wanted to do in fashion I just knew I wanted to be in it you know. So I just started working in the business. I started working at 18 years old on the shop floor in a multi-brand store in London called Brown’s. I was selling Azzedine Alaia clothes. And actually when I left there, I owed them more money than they ever paid me, I couldn't resist the Alaia clothes. And then you know I went to work for a PR company and then work for Mirabella Magazine and then I was at Vogue for five years. So actually before I started Jimmy Choo I had a pretty round good round knowledge of the industry.

R: How did you what was the turning point for you to go from you know not the greatest path to figuring things out?

T: You know I got fired from Vogue and because I was my drug addiction started getting out of control. I was you know 26, 27 years old and I got fired from Vogue and I got scared. And I actually years later I went back and I thanked the woman who fired me. She was called Anna Harvey and she'd been at Vogue for years. And she's the most fabulous elegant woman and I actually am great friends with her today. And I went back and I actually thanked her because it was the wakeup call I needed and I got scared enough to get sober and change my life. And you know I wanted to make my life a success but I was stuck in the trap of of the addiction.

R: For people out there who feel stuck in whatever way it is. What's your advice to getting unstuck?

T: So find find help in any way you can whether that's with AA meetings, therapy support groups. You know there's there's almost. People don't realize how much help actually is on offer. There is a ton out there so I would say find help. And be to driven to do it you know usually it's not as scary as you think it's going to be.

R: Now that you look back on all of this what's been the toughest loss and along the way?

T: Oh the toughest lesson for me when I look back at my career is not speaking up, being afraid to speak up. I wish I could go back and tell my younger self just speak up. Doesn't matter. Don't be afraid of being called a diva. Or you know any of those words that’s used to describe women in business. She's difficult or you know it doesn't matter. I wish I had used my voice more.

R: What do you think... How might things have been different had you done that?

T: You know I think a lot of the deals private equity deals we did with the company would have been different. I think my remuneration would have been different. I think the level of respect for what I did probably would have been different. I would have been treated differently. I was too. I let people kind of get away with things for too long and I let bad behavior go on for too long. And that was a mistake.

R: For our listeners who might not be familiar with private equity deals so the way private equity deals oftentimes work is the private equity company puts a small amount of equity into your company. But then they also put a ton of debt on top of your company which you ultimately have to pay off in order to basically be free.

T: Yes. So what they do is private equity. Here’s the thing people always mistake they they're like well you have private equity investing in your business... No they didn't. What they do is they buy shares from the previous owner. So when the first private equity company came in, they bought shares from Jimmy. But what they did. So they put no money no capital went into the company they just bought shares. But what they did with that they went and borrowed money to buy their shares. And as the company, we paid the interest on their loan from cash flow so they no one came in and actually put a ton of capital in the business and helped us grow. And you know they actually had a great ride because the curse of Jimmy Choo at that time was actually we were so successful we could afford to do that. So we paid the interest on their loan and then they just traded off to each other. You know we got sort of passed around like a hot potato.

R: And by the way. So Toys R Us which is going through liquidation right now had a private equity deal. They had they took on so much debt they couldn't manage through it. And that's ultimately where they find themselves now going out of business. I think for a lot of people they hear private equity and they just see a wall wow it's this massive capital infusion and then you just get to spend the money and have fun with it.

T: No it’s not at all if you want capital infusion. That's venture capital you want to go to a VC firm. They'll actually invest in early stage companies.

R: How have you thought about fundraising with Tamara Mellon.

T: So I went to I had to have a VC firm which has been so different. I cannot tell you to private equity. So VC firms are early stage investors. They they do actually put money in the business and they're the company I've worked with it's called NEA, New Enterprise Associates. And they have been so incredibly supportive, so helpful. They really care about building the right company with the right culture the right people they care about the long term viability of it. It's been a completely different experience.

R: When you went out and were initially marketing the company to venture capital firms. How were you choosing between them and how much did you have already prepared in terms of the model and what your projections were for the company.

T: So we did. So I had an interesting story with Tamara Mellon. So I first of all launched in 2013 and I tried to put a new business model down an old distribution channel so I tried to put it through Neiman's and Saks and Nordstrom and all the big department store chains - which didn't work. They didn't want a new business model. So I actually thought I could pull the rip cord on this so I put that company through a Chapter 11. I reorganized myself and then I went out and raised money and NEA came in and funded the new business model. So we did a business plan that was probably five years out, you know doing much more than that is how do you how do you guess so we did it probably we did it five years plan five years ahead.

R: And NEA is one of the biggest venture capital firms in the world.

T: Yeah they have 17 billion under management.

R: When you made that decision in 2013 to pull the rip cord, how did you come to that decision that that had to be very difficult.

T: It was incredibly difficult because obviously you've got to go through the public humiliation of having a failure even though in Silicon Valley they like failures they say that's where you learn. But you know outside the rest of the world don't probably see it that way. So you know I had to think about you know because I had to go through the public humiliation but I knew it was the best way for me to really execute what I wanted to do with the business it was the only way to get there. I knew that I would eventually get there it would just take a little bit of time for people to realize what I was doing and see then me come out the other side and see it be successful so I knew I'd have a couple of years where I'd have a rough patch. But when they saw what I was creating they understand.

R: It reminds me of this saying you have to take one step backwards take two steps forward.

T: Exactly. Exactly and that's what I was doing.

R: What's the worst advice you've received along the way.

T: Titles don't matter. And that was the worst. That was one of my biggest mistakes.

R: And someone told you that early in your career?

T: They told me that early in my career and not because I think they were giving me bad advice it's what they thought at the time. And then what I realized. You know I I was the Creative Director Jimmy Choo. But I gave someone else a title which was very confusing to the outside world. So I would say titles probably do matter. It represents to the world what you're doing inside the company.

R: Tamara Mellon, thank you so much for joining us on No Limits.

T: Thank you. Thank you for having me.

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