How to Turn Your Dreams Into a Profitable Business

0:00I wouldn't suggest starting a brand on your own. if you aren't interested in being malleable. Maybe your product doesn't sell and you've got to change your idea. Buying inventory in something you love is not as smart as buying inventory in something you test and does well.

0:23Hey, you're listening to Shopify Masters, your companion for starting and building a business. I'm your host, Schwang Esther Shan. Entrepreneurship is all about following your dreams. For Kimberly Gordon, this looked like building the imaginative world of Selkie, a size-inclusive, ready-to-wear brand built on dreamy designs and low-waste production. But her success didn't come overnight. Kimberly built Selkie after mourning the loss of her first success, Wild Fox, a fashion label known for its graphic tees. She's here now to share all the lessons she's learned and the essentials for launching any fashion label.

1:04Kimberly, thank you so much and welcome to the show. Thank you for having me. I'm so excited. It's so great to have you on. And I know that for a lot of founders, starting over again is super difficult and they often don't have it in them to rebuild. I wanted to ask you about what was it that you saw in the market that you wanted to create with Selkie? Well, rebuilding is so daunting, of course. And actually, that's like sort of part of the namesake, rebuilding, as a Selkie is a rebirth, in a sense, if she finds her skin again. When I had my previous company, there was a lot that I wanted to do, especially dresses that I couldn't do because of my situation or partnership there.

2:04And I also started to understand, because I'm 40, I grew up in a time period that like didn't have any kind of diversity and plus size clothing. This was not even spoken about when I was in high school or, you know, those formative years where you're really starting to understand what you want or what you love. So I actually think that it's really hard for people to see outside of like, what their bubble is, right? And it was not until like towards the end of my previous company, that I realized that there was this whole world of other opportunity when it comes to bodies. I was making t-shirts.

3:01They're really baggy. I didn't have to think about it that much. But Ashley Graham suddenly blew up. It was like this big moment. And I just realized at that point that I felt something changing in me. Like I felt this like sort of anger and feminism really, I don't know, so angry about it that I had been raised this way and that it was missing and that I had been like contributing to it for nine years. It's like this cycle. I really wanted to break that cycle. I really wanted to start a company that brought joy and made that accessible joy for all sorts of body types. Just right there alone, like that for me was a really missing key thing in the marketplace.

4:00Yeah, definitely. And I think that realization was so monumental for you to start this rebuilding and also Selkie brought you to the creative vision that you wanted. I think a lot of listeners might assume that because you had a previously very successful brand that was beloved by celebrities, that you would have had the financial foundation to start a second company. But that was not the case. So talk to us how you had to work really hard to start Silky and fund the business on your own. I think that it's really interesting how people perceive business from the outside. Like, we all just kind of form a mental picture of what a business looks like on the inside.

4:47And we stay there. It's a very interesting perspective for all of us, for every business. Because it's really rare, I think, for people to ask, what was it actually like? So people saw this brand as the imagery that I was putting out, right? and in my interviews, that's what they assumed, just buckets of money rolling in. But the truth was that it was an extremely toxic and frightening environment that was controlled by someone who was super traumatizing. And because of that, and because I started it so young, I was 24 when I started it, I sort of call it like the little mermaid syndrome. she's so desperate to get what she wants which is her legs to live free that she'll even give up her voice that's what I think it is to be a young woman it's such a good metaphor for being a young woman because we do tend to give up everything when we're young but I don't necessarily think that's a bad thing always.

6:02I just think it can be a necessary thing.

6:12And so, you know, when I got out of that company, I had nothing because of the situation I put myself in. And this, here, I give you everything, you give me nothing. And in return, you give me the chance, right? You gave me a chance. Thank you. But the problem is, that's not fair. It's only in the beginning. Fair. So I knew I had to rebuild and find a way to finance the company. And ironically, it would have to be by finding that financial investment, which I you know really did not want to do again but I had to and I knew it would be hard. I had no connection to real money. The first thing I think you have to do when you want to start a business and you need money is you have to start telling everyone everyone that you're starting a business and it doesn't matter what the product is I don't think.

7:19in the beginning, like you've got to get yourself up off the hardest place, which is where when it exists here, because in order for it to exist here for everyone, you have to tell everyone it will. So it leaves you and it starts to become part of everyone else's consciousness in your circle. And then also telling these people who are important, who have bigger roles and bigger jobs or big businesses, you tell them you're starting. And you see where that takes you.

7:57Now, I had to meet with so many different people. I can't even tell you the weirdness of this, how hard it is to ask someone for money. And I read a ton of information on body language. Before you talk to anyone about anything, You should Google them and try and find out as much about them as possible. Read some interviews. And then when you reach out to them, have some information ready to say why you are so interested in them and what they mean to you. So I reached out to a woman from Silicon Valley. Yeah, Silicon Valley. There's this woman that I was just really impressed by. And she'd invested in lots of things, but they were all tech companies, all tech startups, not fashion.

8:43and I just asked her like as a woman that invests like what do you want to know or hear from someone coming to you for money and actually and we stayed in touch a little bit she didn't give me money but she gave me great advice and she said ask for the money right away tell them you're looking for money like immediately so I did that and it does work really well actually because then they know you're what you're in for, right? Like they're not wondering, especially with men, to be very clear from the beginning that you're looking for an investment money in your new brand. It was hard. Every guy had something creepy to say, but they would say, oh, I'm interested.

9:26Yes, yes. And they might even fly you out, which, you know, happened to me. And we celebrated with champagne. And then, you know, a month later, it was a no. And this went on for a few years. And in the meantime, I was just working to try and pay the bills. And I'm so grateful to those brands that hired me as a photographer. So I could try and do this in the meantime, but it did take three years. And I never did get a yes, but I did get some money out of my previous brand with a lot of work. I got some money. And that's how I started. So it's kind of, I think if I kept going, though, I would have found someone eventually.

10:07I think that's such an important story, though, because through three years of speaking to investors and trying to raise money, you actually didn't successfully get someone to invest in you. But the important part is you use the skills that you did have as a creative director, as a photographer, and actually freelance to gain enough funding on your own. So what advice do you share for listeners right now who might be working full-time, who might be freelancing, and they're trying to save up to actually make that idea into a business? It really varies on the person because it really varies on how much money you have access to.

10:49you should find money outside of you first like the best kind of money is gifted and then there's borrowed and then there's invested right so I call it the three f's and I learned this from another girl's podcast they said you know three f's the friend the family and the fool the friends your friends obviously if they have money and they want to give you some that's great um that's harder. Family's the best, obviously, because you're connected if you're connected to your family. And then the fool is someone who's going to just give you money because they believe in you. And that's maybe not so foolish, but of course it is considered foolish in the beginning.

11:40So I think first you want to look for those people, right? And actually, I think everyone can access money, even if it's just a small amount, and a small amount is going to take you somewhere. For me, the reason this was so hard was because I had lost everything. I lost a company that, you know, was a multi-million dollar company that I built for nine years. And to fall from that height at the age of like, I think I was 29. It was an insane feeling. I mean, it was a horrible grief that I would not wish on anyone. And I knew that this, like the five stages of grief, like one part of me was like, I'll get it all back.

12:28I'm going to get it back. Right? Like I must get it back. And because of that, it was like I had this other incentive. I had seen the other side. And I knew how wonderful it is to have a company that runs itself and supports you. And you can just live, of course, like kind of for me. But if I had not experienced it, I don't know if this is the way I would have started Selkie. After going through building your previous company, there were a lot of things you wanted to change with Selkie. I would love to get into your approach on low waste production and actually designing and creating pieces and understanding customers' demands so that the production process is low waste?

13:12To me, that's really important because globe warming is a horrific situation, and one of the main contributors to that is fast fashion. And I think people don't really understand what fast fashion means. It's not necessarily just brands like Shein. It is also brands like Nike, it is when they can produce a huge amount of SKUs in a very short amount of time and have a trend cycle that they burn through quickly. That's considered fast fashion. It does everything else, like even expensive things can be fast fashion. And obviously that's a big deal and I don't want to contribute to that. I think whenever you shop at a company where you know who the founder is and they own that brand, like they're not just licensing it out or something, I think you can be pretty confident that that brand is not generally going to be fast fashion.

14:08It's just very difficult to make thousands and thousands of SKUs and pieces. The one way that we do this, which is I think just part of doing business, is that it's demand, right? So like, how many of these dresses can I even sell? And in 2021, we did that mostly by putting things on pre-order. So we would not make what we didn't sell. And that was an incredible way to gain insight into what we could sell. So you get a lot of analytics from sales. And from there, you can increase your SKUs. And this is hard to do when you have as many variants as I do as well, because then you're looking at how many can I sell per size and then how many people per size are going to buy this and then specific items only sell to certain people.

14:59So you have to be really careful. And then the other way that we offset so that we don't have landfill is we do a thing at the beginning of the year called surprise bags. We put them up for very, very low price. Like we don't make money on these. Of course we make money, but we don't make profit. and we let the customer basically go for it and try and get one of these really cheap bags and it has three items in it and that's how we move out all of our leftover inventory at the end of the year we don't keep inventory from year to year unless we know we can sell it for sure in the new

15:42I think especially when we talked previously, you mentioned how it is possible to negotiate with production partners to create larger sizes and have the size range so that you can cater to more people and build an inclusive brand. But I think to listeners, they might find it a little counterintuitive if you're doing the low waste production where you're creating in smaller amounts and yet you're still able to do all of the wide range of sizing. We're not buying none of the sizes. Like we always buy the entire range. We just might not buy as many extra extra smalls as we do a small because there's just less people to buy it.

16:24Or we may not produce as many in 6x as we do in like XL. there's just more people that know of my brand in these size ranges so that's the main problem you're continuously trying to get the word out that you make diverse sizing to begin with because you have to get that audience it exists but they're also looking for an audience that can afford to shop or wants to change the way they shop so it's it's tricky to get that audience but you can with visuals and with amazing influencers. But the best way to get insight on how much to produce across sizing is to literally sell it and then have a restock notice under your product.

17:16So to sign up for notifications on that size. So then we see directly how many people and what size really want. and then we compare those analytics so say I have I have a dress called the Berlin dress and it's very popular especially with the upper size range so then I know that black stretchy dresses will generally perform well or black dresses cotton dresses will perform well across the upper size range and we'll order more in that range and we will continue to like apply those analytics to every product we produce and try and create new product that matches that product so that they have more options.

17:58But yeah, in the beginning, I think it's a slow start. Like, I would really not recommend you going in with a brand new, like a brand that no one's heard of. I mean, like, I'm going to buy a hundred of each size, you know, across the board. That will not benefit you or anyone, honestly, I think that it's a bad idea. I think actually inventory is something that I learned at Wild Fox because we had always so much excess inventory because I didn't get to be a part of that conversation in my previous company. But it's actually a passion of mine. I really love looking at inventory and what people really enjoy.

18:40We love our analytics. I learned firsthand that if you want to make a profit, you cannot be sitting on like tons of inventory at the end of the year. Like especially if you're going to sell your company or if you want the company to look good, inventory is like a killer. That seems like the number one mistake that I see friends make when they go into business, when they make product. Yeah. And I think that's such practical advice. and thank you for sharing your learnings. I'm so excited to get into more aspects of production and understanding the business and operations side of Selkie. We'd just like to take a moment to thank our listeners for tuning in to the show.

19:26If you got feedback, let us know by writing a review and wherever you're listening now, go ahead and follow or subscribe to Shopify Masters. Thank you so much. so we mentioned that with selkie this is you fulfilling so much of your creative dreams and you needed the right production partners to bring these ideas to life so how did you actually go about finding that right partner to help you scale and make those garments yes so this was like the blessing of a lifetime, there are some things in life that you can plan, right? Like that you can prepare for and you can say that you're going to do and it's going to happen.

20:11And then there's the offset of those plans, the things that happen without you realizing. And I think that one was the biggest one of my life. I started making production here in Los Angeles, thinking that it would be this like great way to start. But actually, I have had some horrible experiences here in LA with production. I started to understand later on when I met my current business partners that I had like a very wrong idea of what it meant to be made in America or made in China or made anywhere for that matter as if one country is better I think a lot of it comes from like what our government tells us or wants us to believe like America is great everything we do is great obviously that's not true and yet we have these like fantasies that made in America means that our clothes are made with these like beautiful conditions but actually there's so many sweatshops here in Los Angeles and I even in the beginning when I first started one of my production people moved my production into a sweatshop and I didn't know about it until one day when I had to just show up and get something and I couldn't believe the conditions I had to move out of that production facility actually lost a ton of money because of

21:45it. So I sunk it and then I spent it and I had orders, production orders from stores because, you know, I'm wholesale too. That's how I started. Revolve is a huge reason I'm in business today. I had great production orders with them and I couldn't get financed. Like I had been talking to financers and they were really interested. But the problem is that you have to have so many things in order to get them to finance you in advance, like before you get paid by the stores, right? Like this is the problem. To make production, you have to spend the money up front and it's 50 % up front. It's really expensive.

22:31So if you have an order from someone like Revolve or Nordstrom and it's like$200 ,000 order, it's going to cost you like$50 ,000 to make that order. And then they aren't going to pay you until like a month after you deliver that order. So you have to shell out the money. And that is a lot of the reason that people when they have companies like live with this ball of stress, because they're constantly out of cash flow, it's always in production. And for me, it was eating me alive. And I ran out at that point. And I realized that I would have to find an investor. That's when I met my business partners.

23:17You were mentioning how we do have these preconceived notions of made in US or made in elsewhere. And this is another realization with Selkie where, you know, you did find a production partner, but it was in an unexpected place. And it turns out to be a better partnership than you could have imagined. Yes. So like a lot of people, I just had preconceived notions of what it meant to be made in China until I met my partners who are in China. And they flew me out there. I met them at the last second. They represented that my COO is a woman. It was amazing. She's the one I do business with. I love her so much.

24:00It's a perfect partnership. And it came in the last second. I found them because I posted on LinkedIn through tears. I thought I was going to have to shut the company down. I really did think Selkie was over. I'd lost Wild Fox and I didn't buy a house to my mother's dismay. But I found these partners and they, you know, they had this whole gift to me. Basically, they would help me run the business and put the money and put the cash flow in. And I would just have to move production to China. And I was like, well, that's a really big deal. But also, I'm really need. If I don't do it, I'll lose the company.

24:38So I did it. And I went to China. And I had my whole world turned upside down, I guess. I just couldn't believe how wonderful the factory was, the owner. I love him so much. He's really passionate about change, technology and global warming. And it's really, really awesome to see just the structure at the factory there. There's such lovely things about the production over there. Obviously, in any country, there's going to be these drawbacks. But the other part of this that was really incredible was that I never thought of having a successful brand in China, like selling to Chinese people. It didn't even cross my mind, but it is really starting to grow over there, especially in Shanghai as we're doing Fashion Week there.

25:25And I don't know, my whole world has opened up. I know all sorts of people now. I look at business differently. I look at production differently. I understand production differently. And it's a lot easier. So I gave up something from my company to gain this sort of like freedom to make whatever I wanted. It meant that I could really also be catering to different sizes, like in a real way, going up to 6X, for instance. I couldn't have done that here easily. And who would have thought a tearful LinkedIn post would lead to so much change? And I think that's also such a great reminder to ask for help when you need it.

26:09And it might just surprise you. I do want to ask about being a creative while running a business. I think this is also such an important area because over the years, you had to pick up business knowledge and actually get an understanding on the operation side of things. So what is your advice there for creatives who are entering this world? How can they feel more confident when they're entering into new partnerships and basically building up their business acumen? It's so hard. I think, like, it's not for everyone. I do think you have to have a passion for more than just something creative. Like, I wouldn't suggest starting a brand on your own if you aren't interested in being malleable.

27:04Maybe your product doesn't sell and you've got to change your idea. You can't take it personally and you've really got to be all about the analytics. Like, buying inventory in something you love is not as smart as buying inventory in something you test and does well, right? You have to be of the mindset that you aren't just making things because you love them and they're beautiful, although that's incredibly important to not lose sight of that. You're also making things for a specific reason and that it's either it's going to be like make money or bring the people access. For me, those are two really big things.

27:42As I've gotten older, the secondary one has become even more important to me. um growth of the company is like less appealing to me as is like access and i'm interested in like what more can i do to close off the show we have to ask about the tiktok virality and also all the love that selkie is getting on social media i think what's important here is to understand that when you get so much attention and love on social media, it's just the beginning. What do you do afterwards to build that relationship and turn some of the viewers into actual lifelong customers who just is immersed in the world of Selkie?

28:32Virality is bittersweet. It's a really amazing way to get known, seen. um obviously it's incredibly crucial today's era like it's not the same as when I started my first brand you actually have to build a presence now on social media so anyone has the opportunity to go viral or to create a product that's loved online

29:08I believe that if this were real life and we're outside of the weird stratosphere of online that girls would still have viral moments with the dresses but what happens is when you get this viral moment it's a temptation to like really I guess lean in and because it can be also quite devastating the things that people say to you, the way that some customers or not customers will treat you and your brand. It can be this voice in your head that stops you from sleeping, which also can stop you from being creative. It's really important, I think, to remove yourself from the virality because the reason it went viral is because of something passionate that you did.

29:58and instead of designing or creating anything for viral's sake or for social media's sake if you create it for that part of you that makes you feel passionate and alive that makes you feel like you're going to inspire someone else then I think your chances of virality are going to be higher like I I think people want to see what's real to you and they're not going to respond to something designed that's trying to get them to fall in love on purpose it has to feel like you genuinely believe in this I think that's really important

30:49yeah and to your point intention is so important and i think with selkie you have such great intention in every single aspect of the business so thank you for being so candid and honest and sharing the journey and we can't wait to see how selkie grows thank you so much i really appreciate it. That's Kimberly Gordon, the founder of Selkie. Shopify Masters is produced by Gogo Zoger and Megan Coyle. Our engineers are Matt Shorts and Miku Betlam. Benjamin Gottlieb is our supervising producer, and I'm your host, Schweng Esther Shan. If you're still listening, go ahead and double check that you're following or subscribe to Shopify Masters wherever you get your podcasts, and we'll catch you next time on Shopify Masters.