Why House of Hackney put Mother Nature on its board of directors

0:03This is Business of Home. I'm your host, Dennis Scully. Every week I'll be speaking to leaders and innovators from all corners of the home industry. My guest this week is Freda Gormley, the co-founder of British textile and wallpaper brand House of Hackney. A former buyer at the fashion chain Topshop, Gormley and her husband, Javi Royal, left the corporate world to start a brand with a deep connection to nature. The result was a vibrant collection of patterns and a business that looked to do good as much as it did well. Frida and Javi have taken the bold step of carving out a role for Mother Nature on their corporate board.

0:48I spoke with Frida about the difficult year that defined their business, why they implemented a four-day work week, and why they're very, very cautious when it comes to growth.

1:05This podcast is sponsored by Lalloy, maker of rugs, pillows, and wall art for the thoughtfully layered home. This season, Lalloy introduces a breadth of new collections for all styles, all aesthetics, and all price points. Visit lalloyrugs.com to see what's new and sign up for a trade account. That's l-o-l-o-i rugs.com. and follow them on Instagram and TikTok at Leloy Rugs. This podcast is also sponsored by CLAFs, the world leader in sauna luxury. For thousands of years, sauna bathing has provided the heat we crave. With CLAFs saunas, you can select the exact levels of temperature and humidity to create a wide range of soothing atmospheres, From a classic Finnish sauna to a gentler, softer steam experience.

2:00When you step into a Klafs sauna, you are in control. To learn more about the leaders in sauna luxury and their exclusive trade programs, visit klafsusa.com. That's K-L-A-F-S-U-S-A dot com. And now, back to the show. So, Frida, as I mentioned to you earlier, there are so many things that I'm eager to get into about your business and what you're thinking about these days. But tell us a little bit of what you were doing before you came into this industry and how what you were doing and the life experiences that you were having led to what you're working on now. Yeah, I mean, I'm originally from Dublin.

2:46I actually studied law, but I dropped out of it. And what happened there? I just chose the wrong course. I actually found it. You know, I think I would find law more interesting now, especially as we're becoming very interested in nature rights law. Yes. But back then I found it. I was a creative. I found it too black and white. My father was a lawyer. who's retired now and he actually told me don't do it oh really okay so he wasn't pressuring you to enter no no quite the opposite you know you don't really listen to your parents and I mean I grew up loving English and history but um yeah it wasn't for me so um in Dublin I started um I got in the door of um Ireland's largest retailer they're called Dunn's Doors um and I was put on their trainee buying program and spent some years with Dunn's and was in my early 20s.

3:49London was sort of the hub of everything, you know, fashion, music. And Topshop was absolutely the king of the high street. It was exploding. Yeah, it really was. So I was very lucky to yeah to get a place on the Topshop buying team and moved to London and I was very lucky to be at Topshop and just to be there at a very special moment when Jane Shepardson was the CEO. So Jane was I mean you know she she ended up being sort of my biggest mentor but she really showed to me that business could be a force for good. And even though it was a high street company, she was very much, you know, she was a pioneer of fair trade, helping young designers, using organic materials.

4:51So she really, yeah, she really kind of ignited something in me. Then Philip Green bought Topshop. He bought the Arcadia Group. and things really changed. I think he may have bought it before I joined, but he decided to become a lot more active in it. And, I mean, Philip Green, for those who don't know him, it could quite arguably be called, you know, probably the worst capitalist in the UK. If you do say so yourself, yes. But, you know, I feel grateful to have had those years with Jane because I don't think I possibly, it was definitely the building blocks towards doing House of Hackney. So yeah, I met Javi, my husband, during my time at Topshop.

5:45And yeah, we had our first child together. We bought our first home, which was a house in Hackney. and um we yeah we we firstly decorated it in in the style of the of the time which was very much white walled minimalism um we were really craving um print color texture and I think because the mood outside was so bleak and we were sort of thinking back to our sort of 80s childhoods where you know there was William Morris on the wall and Colfax and Fowler and so so yeah there was sort of I think you know how we were feeling the mood of the times you know we started going to antique markets and sort of you know sort of being we were we were we were much more inspired by what we were seeing there but at the same time we weren't trying to sort of recreate our grandmother's home either.

6:47And we very much, you know, we wanted to bring nature into our home. And yes, so House of Hackney was born. And it's, it's, it's, the ambition was very much to bring the outdoors into the home. And through through what vehicle? What did you what did you imagine House of Hackney was going to be in the early days? Yeah, well, you know, I'd always loved wallpaper at the time um the traditional wallpaper textile you know and textile companies they they really hadn't changed since the 80s um you know their their prints hasn't hadn't changed their designs hadn't changed um the the craftsmanship and the the quality the longevity was absolutely there but that that market just didn't it spoke more to our parents than it did to us as you know young people um so we were inspired by those categories by wallpaper fabric um we were very much inspired by a traditional british aesthetic but we really wanted to juxtapose the old with a with a dose of modernity and um just fun as well because we were living in serious times yeah so so yeah we you know we we knew nothing about interiors um which in many ways was a blessing i think um i think to the interiors world we were like the the enfant terrible because it was like who who are these who are these crazy kids yeah who've come around and are you know we we didn't understand why there had to be kind of um you know so many middlemen in interiors.

8:39Well, so in the early days, when you were, if I recall, you went around the country and trying to find vendors and partners, right? And people who could make product for you. So tell me a little bit about that and what you found. Yeah. So, I mean, my only experience had been working in the high street, which is very much a far Eastern supply base. So we had no little black book of uh local wallpaper makers yeah yeah high-end interior manufacturers right um so we we literally um we bought a van and we spent six months literally driving the length and breadth of england knocking on doors and um we're very pleased to find that there still was in existence in the UK, there were pockets of generational factories that still existed, that had been passed down from father to son literally over hundreds of years.

9:48And those pockets of industry, although sleepy, still very much existed. And in the early days, were you self-funding yourself with this savings or reaching out to friends and family? Or how were you getting it off the ground? I know later you had some investors and we can talk about that. Yes, yes. I mean, those early days, well, pre-launch, I think we had about six months between, maybe eight months between leaving our jobs and launching. We had some savings. We had not much. I mean, I think we launched the whole brand for under 100K. So it was a mixture between our savings. And then we did a little bit of, in the UK, there's a scheme called the Enterprise Investment Scheme, where friends and family could put a little bit of, you know, a few thousand pounds in each.

10:48And there was a tax benefit from them. So, yeah, we had, you know, because to be able to actually buy your production and everything and do everything you need to do, do your photo shoots and marketing and launch the brand, it was very, very hand to mouth. And I think working at Topshop, I mean, I was quite naive, really, because I thought, you know, if you have good product, you have a good marketing campaign, you get a lot of press around your launch, you're going to be okay. it's gonna sell and i'll always remember the the day we launched which was april the 1st um 2011 right and we'd had a we had quite a big launch party um which was hosted by gwendoline you might you gwendoline christie from the game of thrones oh right okay you might remember her she was a friend and she hosted it she was pre-fame um and i remember us waking up the next morning because we had lots of press and thinking we've survived we've survived we can start like buying fruit again you know and because we were it was so hand to hand and we woke up and it was like zero sales right and we were like oh my goodness the website must they must something Something must not be working on the website.

12:14Anyway, and so started the most painful six months whereby sales were so minimal. But I think what we, looking back, you know, interiors is very much a considered purchase. It's not something that, you know, you don't just, you know, you can't try it on. Right. you've got to have sort of a project in mind. It's a much slower purchase. Also, we were brand new, you know, who was anyone to trust us, you know? And it was such a brand new aesthetic as well. So the website launches, the sales don't arrive. Shockingly, the sales don't arrive on day one. And you were just talking about the sort of first six months being quite a challenge.

13:11Yeah. I mean, I think myself and Javi, we really walked around in, I remember just people meeting me in the street and just, I just looked like a walking ghost because we just felt, what have we done? We have, you know, we've quit our jobs. It was such a reckless act to do that we thought uh we had like a viable business plan people obviously don't understand it aren't ready for it we have um a young child we have a mortgage what were we thinking so it was uh it was a very very it was a it was a such a low point um so much so we we we literally were like do we need to get second jobs um and but you know what slowly but surely people started to order samples online it was interesting because the first people who shopped us were the people who are most confident in their taste so it was like creative directors and artists and and then quite soon afterwards we um we got a call from liberty uh the british um luxury department store.

14:30So we, yeah, we set up in Liberty and they obviously had much higher traffic than we had. And it started to get exciting and encouraging because people were buying it there and, you know, word of mouth started to spread and, yeah, other retailers started to get in touch and just general sort of confidence and yeah, sort of a buzz started to happen. But I will say, you know, anyone who is setting up a company, I will say that that first year is the toughest. And actually the first five years are tough. Actually the whole time turns out to be tough. Well, I don't know. Interestingly, I think there are, you know, there are just these sort of gestational, you know, and there are these sort of business milestones.

15:29Things did get a bit easier after year five. Well, so and tell me what happened after year five. So what's what started to get easier? And what was it a level of acceptance in the marketplace? Was it I mean, tell me about that. Yeah, for the first two years, there was three people, there was myself and Javi, and we had a wonderful assistant called Kirstie. And between the three of us, we did every job in the company and we learned so much. But over those first few years, you know, we started to outgrow our space and we became a bit more confident that there was a future for the business. and certainly you know our our retail partners Liberty, Harrods you know we started to pick up people like Bergdorf Goodman and and they all started to sell the brand well so there was confidence and we had a sort of a vision for a house of Hackney world and what that looked like so we decided to sort of take the first steps towards actually having our own space so five years in we um we opened a our first uh flagship store in east london um to be able to do it and to be able to you know afford almost a year's rent up front and um we started you know very much needing some senior management and we needed um you know someone great at the helm who sort of, you know, our skill set was very much on the creative side, on the marketing side.

17:09We were missing the operational merchandising side of things. Sure. So we knew that we were, you know, and we also just didn't have enough stock. So it, which was actually quite problematic because we couldn't service the opportunity. So we decided to go to market and look for investment finance, which at the time, it was very much about private equity finance. Which, I mean, I think looking back, we possibly heard, yeah, a little bit about it's evil. Well, I was wondering what your impression was, if you really even had one, of what private equity was really all about. Did you know anyone who had gone through the experience or did you – what level of familiarity, I guess, did you have?

18:04You know what? It was very much the peak of private equity and all the sort of like, you know, young London luxury brands were all in private equity relationships. relationships. And yes, we definitely had heard a few horror stories, but we'd also heard sort of success stories. And so we, but we thought, you know what, if we, if we retain majority, we can, you know, keep our reins on the company and we can make sure that we protect its sort of precious ecosystem and, you know, our, keep our values intact and all that kind of stuff. So anyhow, we ended up doing a private equity deal, which allowed us to retain the majority, which is very rare.

18:49Yes. And it enabled us to bring in a wonderful MD, Sam, who actually was GM at Liberty.

19:01And yeah, she was a really welcome addition and really helped us. and a few other just, yeah, important. We were able to sort out our finance departments, our sales departments, and the company just was, it was stabilized. So it was, we couldn't have done it without that. So you were experiencing all the good things about private equity. Look at that. Yes. I mean, it has been a challenging journey. How so? I won't go into too much detail because, yeah. It's too raw. It's too emotional for you. It's too raw. But ultimately, the model is about, you know, high growth, fast growth, and it's very exploitive.

19:53So, yeah, the model itself needs reform.

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20:56The notion of growth, because you and I have spoken recently about you questioning the very need for growth, and does that necessarily fit in with what you are trying to do, which is very much, if I understand you correctly, a mission-driven company that is wrestling with how do we better take care of nature? and our muse and give back in so many ways. So tell me, I'm trying to think of how best to get into all of that with you. Yeah, I mean, I think, you know, from the start, myself and Javi, we've never been financially motivated. But what we learned quite quickly on was you actually, you know, you do need to have, you know you need to be able to place minimum orders minimum order quantities you do need to be a certain size of business just to not go under as well when you're dealing with manufacturing right so there absolutely needs to be there there's a quantum there that you need um and even looking at sort of our size today we are um we're a team of about 40 odd people and we don't see the team size growing much.

22:27We don't see the sales growing much either, but it feels like we are a great size to be able to incubate new ideas, keep our heads above water, make enough profit to be able to channel it into our restoration projects. But beyond that, We say we will only grow if it's necessitated by purpose. Let's talk about what first made me reach out to you, which was the announcement that you made about putting Mother Nature and future generations actually on your board and what that really means and what's involved in that. So I think we felt that we were sort of taking such endless inspiration from nature that we felt we really needed to sort of act in reciprocity to nature.

23:28And over time, we were very much using our platforms to advocate for nature. But we really kind of wanted to make our relationship with nature official. and we've sort of been thinking about how how could we do this how could we really bring nature into our company and you know make mother nature very visible so we we got in touch with lawyers for nature and they um they agreed to mentor us to help us create um basically a directorship that would not just honor mother nature but also future generations as well you know business is responsible for getting us into a lot of the mess that the planet is is currently in you know the capitalist model which very much favors you know fast growth very short-term planning I mean we've all been asked to do three to five year plans You know, those three to five-year plans are very much, they're not thinking about what is going to be our impact on future life.

24:43And we wanted to create this Future Generations directorship to really make us think quite long term about our actions. And so a representative from Lawyers for Nature comes to, I don't know how often your board meets, but a few times a year at least, I'm assuming? Monthly. Monthly. Okay, so you're meeting monthly. Yes. And is the representative raising issues around your supply chain, around some of your partnerships and what their supply chains look like? Tell me what some of the issues are that are raised by the representative of Nature. So we started with really reviewing our mission. You know, what's the reason for us to exist?

25:32And we decided that House of Hackney's purpose is to be a restoration project in a craft community and nature. So it was the idea of very sort of officially using our sales to funnel into key projects, key restoration projects that could really help, yeah, you know, restore nature. and especially within the touch points that our business touches. So trees, obviously wallpaper, cotton industry, and also local projects as well. So we worked with an agency called the True Price Agency to very much calculate what is our footprint. We as a company, we were giving 1 % of all sales. We were putting that into key restoration projects.

26:34what came back even though our footprint is um is pretty small and we've actually moved to becoming quite a print to order uh model as well which has like such minimal wastage actually the calculation of our true cost is coming at three percent the equivalent of three percent of sales which is quite a gap between us feeling we were being generous with our one percent right um so but it's very it's enlightening so what it has given us it and then we think about okay that's just paying for our own footprint what about the damage that industries have done in the past you know we feel it's our duty as being kind of the current inhabitants you know the planet of this time to actually to contribute towards the reparations of what's happened in the past so we feel right right now we should be contributing five percent of all sales into nature restoration so we need to now model that into our pnl and and look at you know we we we need to be fiscally healthy and we need, we want to be holistically successful.

27:54That's a big number to, to, to take 5 % of your sales straight off the top. Yeah. What we'll do now is, you know, while we pay that, we will also actively work on our supply base on our materials, which has been another really important initiative this year. So our three biggest sort of, you know, So areas of impact are the paper industry through our wallpaper, the cotton industry and the paint industry. So we felt, OK, we work with these factories who are all also keen to come with us on this journey. But ultimately, our factories are buying from their suppliers. They're buying the raw materials.

28:40We actually need to use our agency to try and make change at the supply level. So we hosted for the second time this year a supplier summit, and we invited those three industries to actually join us for two days to really work with our factories, with our suppliers, and the industry to try and see how we can shift towards more regenerative practices within these industries.

29:20We're taking a quick break from the show to remind you about Lalloy, whose newest introductions for all styles included new collections from collaborators Amber Lewis, Magnolia Home by Joanna Gaines, and Rifle Paper Company, plus newly added one-of-a-kind rugs, pillows, and wall art. Visit lalloyrugs.com to see them all. That's L-O-L-O-I rugs.com. and at Laloirugs on Instagram and TikTok. And now, back to the show.

29:57If I recall, your early private equity investor may have wrapped up its relationship with you at this point? Yes, so we're in the process of exiting at the moment. um so unfortunately the the investment finance sector for businesses really needs um it needs to be reimagined so i think it will be really interesting to see in the next few years how you know with there being so much to talk about the idea of regenerative business and there's sort of so many books on the subject there are actually quite few cases in practice which is why you know, we're kind of trying to feel our way through this.

30:44And a lot of it is almost, it's about kind of unlearning. I mean, first of all, I'm wondering how this is received with both the customers that you're trying to sell to. I'm wondering how your sales reps and all of the people who have to go out and deliver this message and how they're feeling about it, and also how it's resonating with your customer base and all of that, because this is a lot of information coming at people about what is behind your company beyond the beautiful product, which you want them to love and want on its own. So, you know, one of the things we had to assess was, you know, part of our business model was built around collaborations.

31:33And we had some sort of historic relationships that, you know, under the lens of having you know what would nature want just they didn't they no longer sort of stacked up with the journey we're on so we had to wind down quite a few of them um only because some of these other other companies um some of them would be kind of quite major retailers and although they're on their journey um it's they're less agile than we are and um so yeah they're they're not as sort of they're not as far as we need them to be on their journey um we got offered some we've been offered some really lucrative um yeah you know partnership deals i Which we've, you know, the past couple of years, we've had to just say no to and actually really didn't even have to think about it.

32:32There's so much opportunity for you in America waiting for you, Frida. Okay. It's sitting there waiting for you. Are you yet at a point in this whole process where you have figured out how to expand and grow and still stay true to everything that you've just been talking about? because there are so many, I mean, I think you and I talked about Texas or parts of the South, right? That I know, I know, Frida, could be such enormous markets for you. Yeah. But you have to want to go there and you have to want to expand. Yeah. We absolutely love the US. And the American customer found House of Hackney very early on.

33:27I don't know how they found us, but they did. They're definitely, as you say, there is a lot of opportunity for the brand in the US. I think for us, we're not going to expand for the sake of expanding.

33:45We are at a size of brand which we love. It still feels like family. um and i think we're just quite cautious about not wanting to yeah to upset that beautiful equilibrium and ecosystem in any way i'm not saying just about opening the u.s just you know with with expansion can can come headache so your feeling is if i'm understanding what you're what you're saying is you wouldn't want to merely just partner with a wonderful showroom there for the sake of expanding sales there there would have to be a real a real mission that you could find there in texas yeah yeah i think you know you will not see us expanding just because it's an opportunity you will not see us opening up on the high streets of this world um because um yeah the world doesn't need it so i think for us to to sort of to yeah to to move further into the US, it would be very much sort of a case by case.

34:55How could we serve that locality? And are we need are we needed there? Well, I wonder with with that in mind, how has it made you think differently about what you're doing in New York? So you have the showroom at the New York Design Center. And from from what I gather, it's been been quite successful. And a lot of people have, have found you there are there are there ways that you want to to do more locally in in new york or doors i mean how has it how has it changed your thinking there so we we we have found a really great home in the design center i wouldn't say it's our spiritual home but um yeah it it does what it needs to do do i need to encourage jim druckman to get a roof garden or something for you or what would what would help yeah we we love jim we love jim so much and we have been talking to him about about what what can what could we use could we grow on on the roof you know because there are so many there are so many roofs in in new york which um could literally feed people um but yeah we he and we we are having those kind of conversations so designers in the u.s if they're not in New York or if they're all over the country, are they coming through the New York showroom?

36:21Are they coming through your website? I mean, how are you at the moment taking care of all of the demand that you have? Yeah. So designers come through our website or they will go through our team. Our team who are New York based, they will go on the road. They each have the responsibility for different states. So, and they are wonderful brand ambassadors. And I should say that you mentioned about how does the team feel sort of representing the mission? And one of the interesting things was, you know, over the past couple of years, we've actually stopped seeing our team just as, well, we've never really seen them as employees per se, but we really see them now as ambassadors of this mission.

37:09So with every appointment, they're out there sort of, you know, telling their customers about what we're up to and inspiring our customers. And we were an early pioneer of the four-day week in our company. And it's been really encouraging to see, yeah, other companies, these other interior designers and design houses be inspired by what we've done and by our team telling them about it and how it works. We have a four-day work week and we love it. Is that pretty much the message? Well, yeah, but, you know, it's good for business too. It is good for business. You know, the industrial, you know, all the revolutions promise us more free time and that never happens.