Kim Kardashian

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1:03One of the most recognized names and faces in the world today is Kim Kardashian. She has more than 365 million Instagram followers. I don't have any Instagram followers. Recently, she decided to get into my business, the private equity business, and is starting a private equity fund with one of my former partners, Jay Samets. I had a chance at a private equity conference in Berlin to interview both Jay and Kim about their private equity fund. I also had a chance to interview Kim Kardashian alone before the conference began. I've often said that private equity is the highest calling of mankind.

1:37Why did it take you so long to realize that and to join the private equity world? I finally got talked into it once I came to that realization. I have had a long-standing relationship with Jay, who came from the Carlyle Group, and I was pretty close to doing a few deals with Jay when he was at the Carlisle Group. So for about 10 years, we had conversations, whether it was through something we were going to do or people close to us were going to do, and I was privy to all of those conversations. So we finally, you know, had the conversation that we should really get into business together. Okay.

2:22And it's been a fascinating process. So the name of your firm is Sky Partners. Sky is usually spelled S-K-Y. Yours is S-K-K-Y. How did you come up with that name? You know, we had to have a little bit of influence. I thought, you know, J. Salmons. I thought the S for Salmons and K-K, Kim Kardashian. Okay, worked out. It worked out. So you've now been exposed to the private equity world for a little bit of time. You've met investors here and around the world, so forth. What is your view of the private equity investment community? The most honest people you ever met? Very, very nice people. I actually have been introduced to the world.

3:16A lot of my friends growing up, they are in this space now. So I'm on a group chat where I'm being asked all the time about different companies and businesses, mostly tech that they invest in, if they're really good companies. And I've even gotten on Zooms with all of the founders to hear their pitches on their businesses as if I work with them already. so I felt like it would be a really good next step to do it together. So Jay, how did the two of you first meet? And how did you get into private equity, and why did you specialize in consumer? Well, I started, first of all, David, thanks for having us and for being here with us.

4:00I started my investing career about 23 years ago, and I had the privilege of spending almost the last 17 years working for you, as you know. I actually did not start investing in consumer businesses until I started at Carlisle, but obviously spent the entirety of my time at Carlisle doing that. And in particular, I spent all of my time trying to back great, disruptive, high-growth consumer brands. And I have a passion for that. I believe it's the best place to invest in consumer. And the experiences that I had at Carlisle, as I said, are putting us in a position to build something really special here at Sky.

4:32So you also have a clothing company, which is called Skims, right? And you have a skin care beauty products company. It's called Skin. Skin by? Kim. Kim. Okay. All right. All right. Did you need a lot of help coming up with that name? Probably not. Okay. So that's two businesses. It's pretty big. Those are big businesses. Why did you think you had the time, you have four children, to do another business in the private equity world? How much time do you really have for something like this? I feel like in life you have to do things that challenge you and help you grow and evolve and this is a space that after spending a lot of time with Jay and with the knowledge that I've learned starting businesses taking investments from firms and people that I've learned so much about and having great relationships and also being on the other side seeing relationships not work out if you don't partner with the right investment person and team.

5:41And I really felt like we could set ourselves apart by me really being that person that has been the founder, that believes in the founder, that wants to really help that company grow and thrive and really support them because I've been there and seen relationships work and not work. And it was just something that I was really interested in that I was willing to cut back on other things. Okay. And so when you ask people to do meetings, do they say no? Or is it that hard to get a meeting or probably with investors or not that hard? So the answer is no. And I'm grateful for that. and it's largely because I believe that what Kim and I are building is unlike anything else that's being built in this space.

6:33And it's a very intentional combination of two really complementary skill sets that other firms don't have. So, Jay, right now, the private equity world is tough to get financing for deals and so forth. So are you going to be doing buyouts, which require financing, or are you going to do growth capital deals, which presumably don't need as much financing or any? Yeah, our strategy is actually really consistent, again, with what I've done in the past, which was very unreliant on leverage. In the consumer growth world, it's about great asset selection and great execution on value creation plans.

7:09It's not about the marginal amount of leverage that will drive a few basis points of incremental return. So in some instances, when the companies can support it, we'll use a little bit. But in most instances, we won't. It's all about just getting behind the right ideas. Okay. So when a deal comes along, how do you have an investment committee? I presume you're on the investment committee, and so is it a one-person veto? If you don't like the deal, it's not going to get done, or if you don't like the deal, it's not going to get done? How does that work? Well, so far, we haven't really run into that issue.

7:36We both, I think, respect each other's opinion and trust each other. I think culturally, we have the same vision of what brands we think can grow and that we can really help make an impact, but we also both really believe that our team being included in these decisions is really important, and we want everyone on our team to have a voice. What is it that you're most looking forward to about private equity? Is it coming to conferences like this? Is that what you're most looking forward to? Absolutely. I'm honestly most looking forward to my relationships with the founders. I'm really fascinated to hear their backstory.

8:18I'm a storyteller. I I'm so excited just to have the opportunity to help them win. And I love hearing people's stories and hearing what their magic sauce is behind their their company and why they wanted to start the company that they did and what their vision is and just hope that I can help that. You're thoughtful about where your money goes. You've got your core holdings, some recurring crypto buys, maybe even a few strategic options plays on the side. The point is, you're engaged with your investments, and Public gets that. That's why they built an investing platform for those who take it seriously.

9:00On Public, you can put together a multi-asset portfolio for the long haul. Stocks, bonds, options, crypto, it's all there. plus an industry-leading 3.8 % APY high-yield cash account. Switch to the platform built for those who take investing seriously. Go to public.com and earn an uncapped 1 % bonus when you transfer your portfolio. That's public.com. Paid for by Public Investing. All investing involves the risk of loss, including loss of principal. Brokerage services for U.S.-listed registered securities, options and bonds, and a self-directed account are offered by Public Investing, Inc., member FINRA and SIPC.

9:36Crypto trading provided by Backed Crypto Solutions, LLC. Complete disclosures available at public.com slash disclosures.

9:44So you can be called one of the first influencers or maybe the first of the influencers. Did you know what an influencer was really going to lead to when you first became a, quote, influencer? No, I really didn't. I knew that social media was really interesting in a way where I personally, when I got on, used it as like a free focus group. when I had questions about, I mean, I was launching my first product ever, which was a fragrance, and I needed opinions, and I went to Twitter. I remember Twitter was like the first real platform besides MySpace, which at that time, an influencer wasn't even in the mindset.

10:28Same with Twitter, really, for a while. It was more of, I think, a way to communicate with a fan base, but I did use it as like a free focus group that I thought was fascinating. And I, I felt like the, the customer became more invested in the fragrance that I was launching because they felt like they were a part of it. And I just thought that was really interesting. And I didn't quite at that time though, realize what a tool social media would be for business. Now you've built several businesses. When you were building them, people would say, well, she can't really build a fragrance business or she can't really build a clothing business because she doesn't have a background in that.

11:09But they turn out to be extremely successful. So did people not thinking you could do it urge you to make it even more successful? Or were you nervous that maybe they were right and you couldn't build those businesses? Or how did you feel about when you were building these businesses from scratch? I definitely always took the doubt as motivation. I always felt like and still do always feel a bit insecure about it, confident in the brand. I love creating a brand and launching a brand and the whole process of it. I always have those, I think, healthy nerves when you're launching something, especially on a launch day or a product launch day.

11:48But I've always felt a little bit, I've always felt the doubt, and I've always just taken that as motivation to have me focus more and work harder and felt like I had more to prove. So nobody can build a business or run a business by themselves, so you have to hire people and get people around you from time to time for your businesses. How do you select who you're going to hire, and do you ever have to fire anybody and say, well, you were good but not quite good enough? Yes, I have a great team and a small team. And the firing is really difficult for me, so I always have someone else do it. It's really, really hard for me, unless it's someone that works in my household and I have a personal relationship with them.

12:29Obviously, I would give them the respect to do that. But I have a small team. When I started my beauty business, when we started Skims, my business, everything that I do starts with a really selective in-house team. Even from my business manager, everyone is just someone that I've taken a lot of time to get to know, I trust, and a good community relationship within my office and within my house staff everywhere is the most important thing. And you test all the products yourself? In other words, if it's a beauty product or something, you always test it? Oh, everything. Yes, yes. I'm so hands-on.

13:10I'm so involved. I mean, to this day for Skims, I'm still our fit model, which we have like a group of fit models and I'll know the collection that I didn't fit for. I'm very specific on how things fit and I make, I pick the fabrics, I come up with all of the marketing. So with Skims and my beauty brand skin, I do every last thing from packaging design to helping with the fonts and every campaign, every photographer we pick, every formula of every product. I mean, I have to be involved 100%. So many people would say in one family, you probably can't have too many talented business people. In your family, you seem to have a lot of talented business people.

13:56So is there a competition between you and your sisters or you're so friendly there's no competition? You know, even like Kylie and I are both in the beauty business and we don't compete. We feel like we have two totally different brands and two totally different demographics. So I would say we don't really compete in that way. If anything, we would motivate each other. And even we work on everything really privately and don't really communicate with each other about, you know, what we're launching and what our campaigns look like. I mean, if we're really excited about something, we'll share the process.

14:33But it's really rare that we do that now. And we don't really compete like that. I think we all just really focus and do our own thing. So your mother has been involved with your career as well. And your mother is involved, I guess, with your sister's careers as well. So is she a superstar business manager or impresario, or how did she manage to keep all of the children happy and have them each have their own career and own businesses and still be so close to them? She's definitely the smartest woman I know. And it really started for her. She was a housewife when she was married to my dad, and she raised the four of us.

15:11And then when she married my stepdad, she became his agent and manager and got her agent license and figured it out and really helped that. And then it bled into wanting to help her children when the time was right and when our career started. So I ask her all the time how she manages six kids. And we all have very similar lives. But I find it really interesting that a lot of people call her to want to get her to be their manager. And she just, like, her heart is with her children. So I think it's a different kind of love and motivation. But she completely has helped us all figure it out. We come to her for every ounce of advice.

15:57And she's really been so great at managing all of us. and but she's also really good at being the best mom and even maybe a manager would push for one decision she'll push for a mom decision first. So you were very close to your father who passed away at a very young age of cancer. He was a lawyer well-known lawyer. Did that motivate you to want to go and become a lawyer yourself? Absolutely. I mean I think just seeing him every day. He would get up, be on his way to work, drop us off at school, see him, you know, go to work, come home for dinner. Like we just, I saw how hard he worked and I saw just his work ethic that really drove me and especially his law studies, I think really inspired me.

16:47We talked about it. I mean, he passed away when I was 22. So it was, I was in college and we talked about my path in college and he was really realistic with me I did not like school and he said you know I just don't think that this I don't think you want to do this full time I really want you to think about this but if you stay in school I will you know help with your apartment and it was like a trade-off that he would help and I just wanted to be independent and I wanted to not go down that journey at that time. But I do think that he would, I think he'd absolutely be proud of me, but I think he would get a kick out of the fact that I'm doing it now.

17:32And he'd be the best study buddy with me and help me study. Now, to be a lawyer in California, you don't have to go to law school. You can read the law, which is what people used to do many years ago. Abraham Lincoln I never went to law school, and he did okay as a lawyer. So you're reading the law, and you've passed one of the bar exams, and you're going to take another one at some point in time. Is that right? Yeah, I think in about two years, I take the next one. So you need two bars in order to pass to become a lawyer. So I think now, since I've passed the first one, I could practice under someone.

18:10But to be a lawyer on my own, I have to pass the second bar. So constitutional law is kicking my butt right now, and that's what I'm studying currently. And it's extremely time-consuming, but so worth it. So as you've become so well-known, I think you have more Twitter followers than probably almost anybody in the world. Twitter followers, Instagram followers. You have something like 350 million Instagram followers. Is that the right number? Something like that? 359, something like that. 359 million. I have zero. I have no Instagram followers. I'm afraid to be on Instagram because I wouldn't have any followers.

18:51But you have 359 million. So when you go to a restaurant or you go out in the public anywhere, can you ever be not bothered by people who want to take your picture, want a selfie, want an autograph? How do you deal with all that? I think, you know, depending where you go, you really have to know where to go. and you definitely can get away with that sometimes. But you also have to understand when you're going out in public, that's just kind of, I guess, what comes along with the territory. I love to travel the world. If I go to Japan, no one will ask. Their culture is very different. Different places all over the world just have different, I think, beliefs and cultures where it's just not as important for them to ask for photos.

19:40So it's fun to travel and get away sometimes from that. But I also know that that kind of comes along with the territory as well. And how do you convince your children that not every mother is as famous as you? Because they see people coming, calling you. You're very well known. How do you convince your children that not every mother is that way and therefore they have to live a life that may be a little bit different than the one you're living? Well, I think that they really do understand that every family is different. I mean, even within my sisters, you know, other sisters have different rules, snacks that they can eat, snacks we can eat, shows they can watch, you know.

20:19So we do talk about different families and different rules all the time. I think that they grew up seeing a lot and, you know, whether they were at their dad's, you know big events or at filming you know with me and seeing stuff I think they just have known and we've been really open and honest with them about our lives and how big it is and how different it is and let's be positive and think of all of like the good positive things and just try to give them amazing experiences but they are also so normal and well grounded that I'm so happy that they have a group of cousins that can all relate and that we all live in the same gated community and they ride bikes to each other's houses and scooters.

21:08And I mean, it's they're the most normal, well-adjusted kids. And it just makes me so happy. And as a mom, you just feel like you're doing something right when your kids are happy. When you were growing up and you were a little girl at the age of your children, could everybody pronounce the name Kardashian then? No. Because now it's a well-known name, but I imagine people said pronounce it incorrectly then. Did you correct them or was everybody pronouncing it correctly then? No. I remember then, I would laugh with my dad about this. During the OJ trial, when reporters would always say his name, they would always get it wrong and say different versions of it.

21:52And my dad told me a story that when the Armenians came over to America, they usually took off the IAN, off their last name. So anyone with IAN, they're Armenian. And so, you know, our last name would be like Kardashian, you know, and he just would always say, just never take the I-A-N off your last name. Like it's okay if they mispronounce it. We would laugh all the time that no one can get our last name. And now it seems really simple. Well, you and your mother and your sisters and your whole family became famous initially, I think, with the TV show called Keeping Up with the Kardashians. Is that what it was called?

22:27Yes, yes. So when you were first approached about that, Did you roll your eyes and say, I don't want to do a reality TV show? Or do you say, no, this is going to be great. We're going to be famous because of this? Or how did you get the idea? Or who came to you with the idea? And did all of you want to do it unanimously? Or did all of you say, maybe not? Yeah, well, I remember so vividly being at my best friend's house 1989. So I was nine years old, and the show The Real World launched. And I looked at my best friend, and I said, that's it. I have to be on a reality show. And I go, that's what I want to do when I grow up.

22:59And she said, OK, well, when we're 18, we'll make an audition tape for The Real World. And she goes, I don't want to be on, but I'll be your manager. And her dad's a manager. And we laugh now at our conversation then. And the show came about because Kathie Lee Gifford is one of my mom's closest friends. And when she'd come in town and stay with us, she would just laugh and say, you guys are a reality show. What you guys are talking about, fighting about, how you guys live your life, this has to be a reality show. And we called Ryan Seacrest, got connected to him, met with the E! Network, and our show was on the air.

23:37We started filming a week later. I think we were a filler show for a show that fell out of production, and they needed something quickly, and we just started filming. We thought we'd be on for maybe a season or two. And we did 20 seasons of Keeping Up with the Kardashians, 10 spinoffs. And now we're in filming season four of the Kardashians, which is basically the same thing, just on a streaming on Hulu. When I was nine years old, I wanted to be a major league baseball player. That didn't work out for me. But usually when you want something at nine, it doesn't usually work out. But I guess it worked out for you and your sister.

24:16I was determined. They didn't care and they didn't want to do it. but I talked him into it by saying that we had a clothing store, and I said, you guys, this would be the best promotion for our clothing store. We should really consider this, and that got them hooked. Worked out. It did. Thanks for listening. To hear more of my interviews, you can subscribe and download my podcast on Spotify, Apple, or wherever you listen.

24:49Thank you.