654: The Hoodie That SAVED Their Business ($5M in 2 Years) | Boys Lie

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0:39Just head to OmniSend.com forward slash founder without the E to get started. All right, now let's jump back into the show. So what happens when you launch a cosmetics brand, but discover customers only want your branded hoodies you're sitting on mountains of unsold makeup inventory ready to close up shop you think you're done then gigi hadid steps out in your sweatsuit and changes everything overnight well today's guests tori robinson and leah omali founders of boys lie the fashion brand born from heartbreak that became a cultural phenomenon after launching with 16 plus cosmetic skus they discovered customers were only buying their two branded hoodies they're stuck with unsold inventory and ready to quit, they sent a blind gift to Gigi Hadid.

1:25Two months later, Gigi wore their goodbye sweatsuit in a paparazzi moment. Demand exploded and they pivoted entirely to apparel. So in this conversation, you're going to discover why they never do unsolicited celebrity gifting again, despite it saving their business previously, the brutal employee embezzlement that cost them significantly and the financial controls they built to prevent it, and why they turned down a major buyout offer two years ago. This is a real raw conversation around building a brand that resonates culturally and why sometimes your biggest pivot comes right when you're about to give up.

2:00Hear the stories, learn the proven methods, and accelerate your growth and future through entrepreneurship. Welcome to the Founder Podcast with Nathan Chan.

2:13Welcome, Tori and Leah. you guys launched a cosmetics brand that generated$250 ,000 in revenue against$250 ,000 in debt. You raised money from friends and family, but your second year you pivoted to apparel. What made you realize like, cause most founders, if they do$250 ,000 in their first year would be like, Oh, I'm going to keep going with this. Like what happened? Basically pre COVID. Um, we got to a point in our business with the cosmetics where we looked at pat mcgrath's business structure as well as jerry lorenzo's something so special about both of them jerry lorenzo started with one hoodie for fear of god it's a very big brand now um and he continued to progress that one skew until it grew into a huge huge brand um so we really admired that on the apparel side of things and on the makeup side of things pat mcgrath um i know the business isn't doing that well today.

3:12But at the time, it seemed like it had boomed. And she had these bomber jackets that she sold with the cosmetics. And we were both like, oh, this is amazing. The bomber jacket sold out. So something really interesting about that in general, before I jump into the cost of everything, was that the apparel side of things versus a cosmetic side of things. I'm wearing pink nail polish. Any girl can go to the store to get pink. They don't really need a brand specific item to go get that color for a cosmetic. When we launched, we launched with so many SKUs. I think it was it was over 16 SKUs. And then we decided to have a hoodie, which ended up growing into a sweatshirt and a sweat pant.

3:56Yeah. In the height of her breakup with Tyler Cameron, Gigi Hadid had walked out in a full paparazzi moment head to toe and boys lie. and it was almost like the clothing just spoke for itself this little set that we had it literally just kept selling out and kept selling out and during that time too after we had produced our cosmetic items and we're holding on to so much inventory for them um we were basically setting the cosmetic items with the clothing items out as gifting for anything that we had left because we were like in this stage where we were like oh my god we're gonna have to close shop anyways this isn't working there's no chance that this is gonna work so that pivotal moment changed everything for us in mindset and the business's shift where again because of that moment with Gigi and because it was something that was so I don't want to say controversial because it wasn't essentially controversial but it was such a building to the brand name and like what the brand's ethos is and it's like about heartbreak and and also stepping out and like feeling empowered and what you're wearing and I think the boys lie goodbye set was like the epitome of that so i think for us like when when that happened we were like holy shit because we got sorry can we curse of course because why we had so many people just messaging messaging us asking for clothes which is why we did switch to apparel what i'd also say in the first year when we did make the 250 000 i would say majority of those sales were the two hoodies that we had as merch and not the cosmetics so like tori said about the inventory too just making sure that we're properly like keeping up with the demand, but also not like overproducing.

5:30So we're sitting on so much that we can't that we have no space in our warehouse and also that we're not selling. So just trying to find like the a good way to figure out how much we can make and also what we know we are going to sell based on previous sales of what we had before. That moment, though, changed everything for the brand. And that's how we made that much money within the following year is that pivot to clothing because the demand was so high for those items and we continue to grow it. and grow out our SKUs in clothing slash apparel, whatever. Yeah. So you talk about the, you know, when Gigi wore your goodbye sweatsuit.

6:06So just before COVID, how did that happen? Talk us through that. Okay. So I went to school at Arizona State, which was a big party school. And Arizona is such a great location or Arizona State in general, because you have Scottsdale around you, you have Vegas around you, you have Palm Springs around you, you have LA around you. So basically on the weekends, you can really go anywhere and meet anyone. I was introduced to Coachella my sophomore year of high school, and I got to meet quite a crew of people that like basically adopted me into their LA friend group. There was a lot of skaters, but a lot of these people that were like super, super connected and it wasn't with any intention, like the foundation of our friendship wasn't with the intention of networking.

6:52Like I feel like that's how it is a lot today. It was like, I genuinely befriended these people. And so when we were at this stage of like, oh my God, who do we send to? What do we do? I asked for their help. And I said, hey, like, you don't need to vouch for us by any means. I don't want you to tell this person that we're sending this gift, but I know that you're friends with them or that they're close enough within reach like a Gigi Hadid would be or a Mimi Cottrell. And I said, hey, can you just send me an address? I'm going to blindly send it. If they hate it, they probably won't wear it they probably won't open it for months it is what it is but um can you like at least just give me an address and throw me a bone here and they did and i will say we would never do that now um all of our gifting is pre-approved by the person that we are sending it to because it is we don't want to waste product and also just continue to send to somebody who doesn't necessarily want it but when we did ship it to gg i think she might have had it for at least three i want to say two months two months before she stepped out wearing it and it just so happened that the paparazzi was there to catch it.

7:53I think at that point too, we were like, we're screwed. Like our business is going under. And when that happened, it was like this huge moment because we literally just like never stopped working after that. Yeah. That's crazy. So, so right when the time you guys needed a big break, that was your big break. Yeah, it was crazy. It's kind of crazy. Cause when you think about manifestation, it's really more so taking the actions to make something happen and just believing in it so wholeheartedly that no matter how many times you get rejected, it's kind of like we surrendered to this failure and then it ended up becoming a success somehow.

8:29Like I we were working really hard in general, but it kind of felt like in that moment we gave up to say like, you know what, maybe this isn't for us. And then magically it became for us, but it wasn't in the industry that we had initially proposed it. And yeah, we had nothing left to lose at the time. Yeah. Yeah. It's funny you say that. I was talking to a friend this week actually, and I was talking to him about like one thing I need to focus or be better at is being patient. I always want things yesterday. And, you know, as founders, we move so fast, you know, things are done yesterday. Bang, bang, bang, bang, bang.

9:06And he said to me, Nathan, do you know what patience actually means to me? And I'm like, oh, just being more calm, like just waiting just like not expecting things that are going to happen to like literally yesterday and he said no patience means hard work means just working harder and i i really like that flip because sometimes you know because i know i'm an impatient person i actually feel guilty sometimes because i always like you know or maybe i just like i feel bad that i want things yesterday i want to like all these things to happen um so i think it's really cool that you guys you know everything happens for a reason i truly believe that so i think it's really cool that you guys were at this point where you're like thinking literally is this going to fail so take me back to that moment like because i think it's a rite of passage for every founder where, you know, your next big, in any founder's journey, you have this big break, but just before that big break, things feel so tough.

10:15How'd you guys get through that? Yeah, this is kind of crazy because the GG moment happened literally the week of us having a sit down conversation and being like, we overspent in some areas. We don't have like any money to support this business. This is crazy. we also didn't have a team of people it was just us to learning as as we go type of thing so I think um like you said earlier it was kind of like our big break and back then too like influencer marketing and all that in general was still kind of fresh like it wasn't as huge as it is today um so the gifting aspect of it all I think we were like starting on that journey with the rest of the world like it wasn't as big of like a I would say the only other emotional type brand that was in the market that would be similar to ours that I could like even think of from the top of my head would be a mad happy essentially um I think with us knowing in that pivotal moment of failure like that it's gonna be okay again we had nothing to lose we started from the like base bottom like the the bar was in hell you know what I mean so for us it was like at that point any win by any means was like we won today we really won big we won the lottery even if it was the smallest smallest step and I think that for us that moment and again that week it was really hard because we were again talking about this this big failure and it was a really big moment for us um the fact that gg had stepped out in this full set and it was going viral and having this viral factor which is like much more digestible now as content versus then um i mean for us it sparked something in me where i was like no this is gonna work like this is actually gonna work and it's gonna work really well it's not gonna work in cosmetics it's not gonna work in a consumable good but it's gonna work in a good that you can wear your heart on your sleep with.

12:18And that's what we push forward there with. And when you said you literally had the conversation like that week or around that time, um, that this isn't going to work, were you guys literally planning to shut up shop or were you kind of going to raise some more money or what were you thinking? We weren't going to go raise more money at the time. We were like, there's no way. We both also had like moved and transplanted ourselves to California from the East Coast and from the Philadelphia area. We had a background in working in private label manufacturing for cosmetics. So that kind of helped us a little bit along the way, thinking that we would land in cosmetics.

12:58It also showed us, you know, the process of how something was made from start to finish. And, you know, in that conversation of us saying like, let's look at this on like a larger scope, we started looking at like, oh my God, we had spent all this money here versus here or oh my god in the process of how it's made did it really matter to have these really recognizable pieces of cosmetic components that were special molds for our logo or would it have worked in just a singular um bottle that you could have purchased wholesale at a trade show like Cosmoprof for instance and we were kind of going back and forth like where did we go wrong here um which actually made us discover you know again like we went wrong in so many ways but the only way we did go right and was the was the clothing and um gg was kind of like the answer to that i'm not saying everyone has that i also don't believe there's any such thing as coincidences um at the same time so i don't know how that happened within the same week of each other but it happened that way it was also just empowering too i think that Like, even when we did talk about like, okay, like we have no money left.

14:10Like, what are we going to do? I will say I don't think either of us fully believe that like we would be done. I think that we had so much will and so much drive that we wanted to figure out a way to make it work. So we were like, what can we do? What can we do? And I think, again, like usually when you go through a heartbreak and all the time, actually, when you go through a heartbreak, it's terrible. And you're like, you feel like it's the end of the world. And I think her stepping out in that set, like that said, boys lie goodbye, maybe like woke something up and people were they're like okay this here's a strong woman stepping out right after her breakup with so much confidence like i want to be like that too how can i be like and did a new brand that no one had really ever heard of so it made it so niche so quickly um and again it the irony of it happening coincidentally we never had a proper answer as to like what were we actually going to do by the way like we really were going day by day like how can we just be better than we were yesterday that was just the plan yeah and how much stock did you have at that time not enough well not enough of the clothing at all but of the makeup a lot um imagine you need of each component you have to purchase about two to three thousand units of that component and then we diversified that into multiple skews based off of colors so we had like 48 skews um of colors that were broken out from two thousand thousands of units yeah thousands and not failed yeah we still have those components today which is kind of crazy there you go okay so let's talk about influencer like just on this topic like working with creators working with influencers you guys um you know a lot a lot a lot of founders you know hear stories that you work with a famous founder so you work with a famous creator and you know your business changes overnight right you guys kind of a living example of that right and you've worked with many other creators and influencers and celebrities like this is the thing that you guys do so um a lot so what would you say to founders when it comes to working with celebrities or content creators these days what's what's the whole play and and what what are you seeing and And what recommendations would you give?

16:25I have a couple of them. First and foremost, your product needs to speak for itself. If you have a good product and you believe in your product, I think that that standalone, whether you have an influencer that's an Alex Earl, actually, I would call her a celebrity now. I would say influencer or a Kim Kardashian versus even micro influencers. As long as your product's good, it's going to sell. And it's as long as you believe in it and you wholeheartedly keep pushing that through, it's going to sell. Yeah. My next thing was when we did do the gifting, essentially, we didn't just send it out to Gigi Hadid.

17:01We kind of thought, you know, like, how can we get someone like Kylie Jenner wearing our product? How do we get to someone that big? And we were talking about it and we were like, you know, we spend more time together, the two of us, than we do with our family. So who does Kylie work with every day? Who are her best friends? What's her family like? So we started actually reaching out to her makeup artist, her hair person, and we started gifting out that way. And they ended up picking up the product, loving it, wanting more. And eventually Kylie kept seeing it. And eventually then we got a request for Kylie to wear our product.

17:35So that would be my second form of advice is kind of who are these people that you're actually interested in engaging with and who do they surround themselves with? Because that's a reflection of who they are. um and i think my last thing like now the market's so different uh than it was a few years ago so it becomes more difficult to work with people i mean i still now we check in with people and we're like hey what do you want here's the line sheet essentially of like these exact items so seating is more or gifting is more intentional than what it used to be yeah um i think just like sometimes you really just got to send a message, I think, to become more relatable to that influencer and how they use their narrative.

18:24So an example of this is, who did we DM this to? I think it was, I don't know who, I just remember this DM message that we came up with and it was like, I'd give my left pinky toe to see you wearing our stuff. Or would you do some charity work and wear our brand type of thing and opening up that message that's so personalized that's less of like something that's so robotic or chat gbt like like we'd love to send you gifting well that's like a copy and paste message when it comes from some sort of sincerity in regards to the narrative that aligns with that influencer it's it hits different yeah so like even when it comes to like like we switch it up too depending on who we're messaging but i think what we've I will give us a compliment here and say, I think what we have done a really good job at is like being authentic to ourselves with this brand.

19:14So even when we first started and we were messaging our customers back and forth on Instagram, like it was always us, like it was our voice. It was how we would talk to each other normally. And so we've also trained now our employees to respond and, and I guess in the brand voice in that way in our DMS, because we aren't robotic. We're very, we're from the East coast. So like we have a lot of energy and a lot of personality. And I feel like you want to make it, You want it to feel like you're talking to a friend rather than, like you said, like a robot. But I do think that this market, and we were talking about this this morning, and I'm not sure if you feel the same way here.

19:47It's become more difficult in regards to the playing field with influencers or celebrities based on ask and how much content value is actually worth. For me, I feel content is so digestible now. So like when people do those long form pieces of content that are like, like a runway show, even being 15 minutes, I love watching that type of content and I see it, but then I'm just like, oop, I'm just going to scroll to the next thing now. And it makes you kind of wonder how one valuable the content that's being curated is. Even if that's somebody just being like, Hey, on their shop, my like, this is my boys lie hoodie and here's my affiliate link.

20:29Like hope to hope you guys buy it. I don't know anything like that. Or I love this hoodie. It's, it's become really interesting and almost like a strain. Something that we easily got taken advantage of and we're really naive to and moving to LA and doing this is that we got taken advantage of by a lot of agents and representatives in saying like this person who's an influencer would love to work with you, would love to wrap the brand, but they want 10 grand or 20 grand or 150k. And at first we would like try and figure out a way to put together 10 grand to even pay them to like put on the makeup.

21:08Now we stopped doing that entirely. We would never do that. We said that like if they want to wear the brand, they'll wear the brand essentially. And that's the point that we had gotten to. Yeah. It didn't feel authentic in the content that they had created yeah and then it was also like it got to a point where when we started saying no to people they would be like what about for three grand right and again this is way earlier on now people will ask for like crazy amounts of money um but i feel like now it's become so wild that i don't feel like influencers and maybe this is just my hot take Like you get someone that could be like not an Alex Earl, but a very high up influencer.

21:50And they'll be like, I think I deserve 150K for wearing your hoodie and doing a content video. And you say no to the agent and they go back and they're like, well, what about 40K? And then I'm kind of thinking to myself, well, now you just shot yourself in the foot because now I feel not only disrespected, but out of curiosity, what makes you think that this person can sell 40 grand worth of clothing? Can you send me any statistics based on other brands that they've worked with just out of curiosity, you know, just to kind of like really entertain this idea? Yeah. And they'll say no. And it's like, why as a brand would you risk giving someone almost a full yearly salary, not 40K, but a full yearly salary of like 150 grand, which is insane to me.

22:37For no proof of skin in the game. And at that point, it's like, let's share the royalty here. Let's split the profit if you're going to really do that for collaboration. So we moved on to a collaboration agreement that is a split of profit on revenue and people don't love it. That's why a lot of people don't prefer to like work with us on that higher level of A-list celebrity. But the reason why we feel that way is because we've been burned in the past. And I, again, think that this market, it's it's becoming so oversaturated for someone that's saying they're an influencer or celebrity. I think that there's like too much middle ground to cover.

23:18Yeah. I also will say, too, just because you have a million followers, like doesn't mean you can sell a million dollars worth of products. We also learned the hard way that just because you have all these followers and you have high engagement, that doesn't also also necessarily mean that someone's going to be buying what you're wearing. Some people might just like your page because of the aesthetics or because of what you're doing. Maybe not because of what they're not going to go online and buy exactly what you're out there. No, and look, like, Leah and I have been the faces of the brand, especially, I mean, since we started, but especially over the past two years, we've done all the photo shoots around the brand.

23:49The brand has like 180-ish thousand followers. We do$11 million. We did$11 million in sales last year. So when you think about it kind of at that scale versus someone who might have a million followers, well, I want to see them put like money where their mouth is. I want to see how much cash they're actually generating weekly based, not based off of just their talent content, but I want to see what they're producing to like support that. Yeah. Yeah, you make some really good points, especially around, I think, the relationship. So it really comes down to the relationship, trust, and rapport that that content creator or influencer has with their audience.

24:30And it is very few and far between. like in you know with my brand i don't run it anymore i sold it but there were some micro influences that we worked with that just had a really really really good relationship clearly with their community and the product just fit and drove a lot of sales but then there were some with like hundreds of thousands of followers and like you said drives nothing um some key things that i noticed and i'd love to hear your guys take is i find creators especially that have a youtube channel really really strong creators or celebrities that have shown some form of vulnerability like in a deep level on tv really really strong as well they just have a lot of trust.

25:26They just have more trust with their community. So for anyone watching now, what do you guys look for when it comes to content creators, celebrities, influencers that you work with? Are there any key traits like I shared? So we can see actually some things that happen where we're like, oh my God. An example of this would be like Amanda Petula from Summer House, which is a Bravo TV series. They had an episode last night that was a very emotional episode or two nights ago, That was a very emotional episode. She was in a fight with her husband. Her husband really wasn't treating her well, but she was in a full set head to toe in Boy's Lie.

26:04After that episode had aired, the set sold out immediately. And she wasn't even saying anything about those sets. It had nothing to do with, hey, I love Boy's Lie. Absolutely zero to do with that. It was simply her wearing it. And I think another thing in regards to trust is it does take an influencer more than once or celebrity more than once to wear it to really see the reflection of like that buying power. For instance, you'll get a couple buys. Jessica Alba, for instance, has posted wearing our stuff without a tag or anything like that. She had immediate an immediate reaction where we saw the item she was wearing from her post on her story time versus our Shopify time of people buying it.

26:46it showed a reflection of an increase of buys. Then she started posting it more and more and that showed you even more buys than what had previously happened for the first time that she had posted. So I think sometimes it's it's it also takes consistency. And I think as well as not having that hashtag sponsored or hashtag partner or whatever it is like we just give ours as a gift and we built the relationship that way versus saying like yeah I'll pay you for doing this if this was a photo shoot it would be different or like a formal collaboration obviously we we would pay for those types of scenarios but for simple gifting this is a gift to you and if it plants the seed with the audience that's amazing but um that's I think my answer there yeah no I'm thinking about like the emotional connection part to it too I think that it really also depends like like tori is speaking on the summer house episode like that just so she just so happened to be wearing boys lie and in a scene that was very boys lie coded i'd say um but then there's also been other circumstances too you know where like alex earl well we keep using her example but she's such a great example when she was with braxton she was consistently wearing boys lie even though she was in a happy relationship and i think that like no matter what as long as it feels authentic to the person and it feels authentic to them.

28:08I think that's what sells anything in general. Like if, if, if she's putting on something that, I don't know, makes her feel uncomfortable or she's never worn before, it's not, people aren't going to be thinking about it as much as they would be if they're consistently seeing her wearing it. And, um, some people want it for the moment too. I think that's, what's so exciting for a brand like ours specifically. Um, Ariana Maddox, she was in a show called Vanderpump Rules. she had a huge breakup um go on where her best friend was sleeping with her it felt like basically husband at the time they were like in a 10-year relationship um and at the reunion for this is another bravo show we love our bravo liberties but at the reunion um we got a request from a stylist her stylist emily mann and she was like i need to get ariana wearing this into the reunion And it was shot by TMZ and all these different people.

29:02And it got picked up really quickly. And that set sold out. And just in the preview of the reunion. And fortunately, that was something we weren't able to prepare for ahead of time. So we didn't. I mean, we sold out of our inventory. We didn't have more to restock. But it ended up creating like a partnership or a relationship with her. So then we ended up collabing with her again later down the line. And with Uber, where we had this shirt that's called an Uber, not your ex. and it was donated to Alexandria or parts of it were donated to Alexandria house. It was so long ago. But we that created this relationship with her, too, that sparked a new collaboration out of it, which was really cool.

29:40And exposure. Right. Like, so a huge part of this do like, let's say you don't see immediate ROI on someone wearing something. You might get something else out of it. We saw it again with I'm going to use the same examples as Amanda Batula and Ariana Maddox but what was so exciting about Arianna Maddox is although we didn't have inventory on hand to support the demand of what people were requesting and we sold out so quickly is that we actually got a reach out from I believe it was Nordstrom's who was like I saw this I need to get Boys Lion Nordstrom's we are huge Vanderpump fans I'm a huge fan so it might just be the buyer's preference as well and that's literally how we brought on the customer yeah she felt so connected into this show that she had to have boys lie in Nordstrom store.

30:28And now Nordstrom's is one of our bigger retailers. And that graphic 1-800 boys lie is still one of our top selling graphics as well. Yeah. So, okay. So I think we're really covered like how you guys work with creators, all of that good stuff. Um, really, really, really helpful just for founders right now. So you would recommend starting with gifting don't pay just to round that out right yeah i mean you wouldn't you're essentially you are paying right you're paying for the product to gift them you're paying for the shipping materials to send them this gift you are spending money i'm not saying that you aren't you're just not giving them cash as a cash out saying hey take this money just to wear my product it just doesn't make sense i agree that's how i've always done it i've always done extreme amounts of gifting and then certain people pick up the product you see you can it's a little bit of a testing ground as well who if you want to further collaborate and work with them yeah especially for direct to consumer focus right like we are strictly direct to consumer so you can't go and just touch the product or go see it or try it on it's like you really have to find a way to vocalize how great this product is and amplify that voice and i think that that's something for direct to consumer wise, like ship it out in a box, that's how they're going to receive it as well.

31:50You know? Yeah. And people, I think founders often think, oh, I want that return. But one of the awesome things is getting the content because the content is gold, right? You can use that in your creative from a paid media standpoint. You can use it in your social content. Like in some of the creative, it does like, it can be better than getting the sales because that's what costs you a lot of money to make awesome creative so totally yeah that's something that a lot of people forget about as well i think yeah all right so let's talk about you were talking about nonstrom i want to talk about wholesale revenue that side of the business so you guys about 60 40 d2c wholesale retail right yes yeah so how do you manage cash flow with major retailers when they operate on net 30 terms that don't often start until goods are physically received?

32:48That's actually a great question. I mean, do you want to answer that? Yeah. So, I mean, since our DTC is obviously bigger, like it's growing and our margin's better there. So we kind of use that to like maintain cashflow and we want to keep growing the DTC business to be bigger than wholesale, obviously, because that's where we make the most money. That's the foundation of the business. So it really just depends. And also like we have a really... solid relationship with our manufacturer who we've been working with for years now. And so I would also say like, creating a good relationship with the people like that are making your clothes and coming to like an understanding of like, I guess, price points.

33:29And when you're paying them, it also kind of like all works together in the same type of flow. So I think just making sure like our DTC is constantly growing. And so we have cash consistently coming in and also just being able to talk to manufacturers as well. What's the company we almost worked with that could give out loans for? Oh, I forget. There's a couple of factoring companies as well that people use in the retail industry, even privately owned brands. We haven't gotten into that yet, but I will say there's so many positive attributes. Hilden. Hilden, sorry, is the one I would recommend to anyone in our space.