744 Marguerite Adzick: Founder & CEO of Addison Bay

0:00Kara Goldin:I am unwilling to give up, but I will start over from scratch as many times as it takes to get where I want to be. You just want to make sure you will get knocked down, but just make sure you don't get knocked out. So your only choice should be, go focus on what you can control. Hi everyone and welcome to the Kara Goldin Show. Join me each week for inspiring conversations with some of the world's greatest leaders. We'll talk with founders, entrepreneurs, CEOs, and really some of the most interesting people of our time. Can't wait to get started. Let's go. Hi, everyone, and welcome back to the Kira Golden Show.

0:45Kara Goldin:Today, I'm joined by an incredible entrepreneur guest, Marguerite Adzik, who is the founder and CEO of an incredible company called Addison Bay. And it's a women's activewear brand redefining what it means to look polished while staying performance ready. And I have to tell you, I was just sharing with Marguerite that my daughter took one of the sweatshirts that I have that is a beautiful white with a blue stripe. And she took it and the first thing she said was, oh my gosh, it's so soft. It's like butter. It's so wonderful. And so it's the quality and everything about it is really awesome. So Marguerite was a former Division I athlete, worked for that little company, Lily Pulitzer for years in marketing.

1:46Kara Goldin:And then she decided, I'm going to go and do this. I'm going to start my own brand back in 2018 to create activewear that could keep up with real life, not just the gym. So 100 % female-run brand has grown into a nationally recognized brand with a flagship store, in case you're in Philadelphia, in Philadelphia. So I'm so excited to have her here and dig into how she is building, how she started, how she's building, and how she's overcoming any challenges that she is running into. So super excited, Marguerite. Nice to meet you. Oh my gosh, nice to meet you. What an intro. Thank you so much, Kara.

2:30Kara Goldin:It's fun to have someone else like read your intro, right? And you're just like, And you're waiting. And yeah, no, I love it. So it's so cool. So for someone discovering Addison Bay for the first time, what do you want them to feel the moment that they put it on? Yeah, I mean, I always say we're elevated activewear. Like if you're going to say two words to describe the company, it's elevated activewear. It's pieces that can take you from 7 a.m. to 7 p.m. And that is basically the need that I was trying to solve with women. So I felt it as a consumer. That's kind of how like the brand started, how the business started.

3:09And I wanted to fill that space. And so I really just want them to feel elevated, polished and put together from 7 a.m. to 7 p.m. for all parts of their day.

3:17Kara Goldin:So you were a college athlete, a division one athlete at UVA. So can you share about that experience and how that maybe has helped you to take on this role that you've chosen to take on as founding a company? Yes. I mean, many moons ago, I graduated in 2011 from the University of Virginia, played Division I lacrosse there. I had an excellent experience. It was one of the most challenging experiences, but it was so defining for my character. And I think two things that came from it, actually three, three things. One, I was the captain of the team my fourth year. That's what you say, UVA, first, second, third, fourth year.

4:01And so I think I really trained me in leadership and I really learned what my leadership style was, which is really leading by example. I work extremely hard. I expect my team to work extremely hard. I learned that at my UVA days. And I've carried that on into my professional career. So I thought that was really helpful. And then two things that I kind of learned about myself, just character wise, are grit and optimism. Like I have an extreme amount of grit, especially in sports, like you have to dig deep. Like there are some really rough days or some really low lows. And that's kind of what like starting a company is like and what it's been like in this journey.

4:39It's such a roller coaster, high highs, the lowest of all the lows, and you got to have that grit and dig yourself out of it. So really, I, you know, fine tuned that part of myself and really built that muscle up that gritty, you know, very solution oriented muscle. And then optimism, I honestly, I think I was born very optimistic, not glass half full, like glass full to the top. But I think during those gritty, super low moments that I've talked about, you got to have optimism. You have to have a very optimistic lens, the way you look at things or you're never going to make it through. You'll never get back to that top and the crazy roller coaster.

5:17And again, use that in my sports days and I've used it in my professional career even more. And it really has, those have kind of been like my two superpowers or things that I really rely on and lean on during those high highs, low lows, everything in between.

5:32Kara Goldin:So take us back to that moment, if you can recall, when you just decided, I need to create my own brand. What was going on for you where you just said, it's time? Yes. So the timing is actually so funny for me looking back. And I remember it like it was yesterday. You're like, if you remember, I'm like, oh, Lord, feels like yesterday and also 100 years ago. But I had been thinking about the idea for a while. I was living in Center City, Philadelphia, and Rittenhouse Square. People are familiar with the area. And I'd been thinking about this kind of elevated activewear brand and honestly just didn't have the bandwidth at the time.

6:09I was trying to get pregnant with my first child going through IVF and finally got pregnant with my daughter. Now I have four kids, by the way. So long journeys since then. But I finally got pregnant with my daughter. I hit that like 14-week mark where you're feeling like safe and things are going in the right direction. And I was like, oh my gosh, is the perfect time to start a business and write a business plan and pitch the idea to a, you know, a few friends and family round of investors. And that sounds ridiculous at 14, 16 weeks pregnant that I'm actually like thinking that way. But I had been thinking about it for a while.

6:43It was right here. And I kind of put it on hold for a bit to deal with some personal things. And then I was like, it's time to put the foot on the gas. Went to my second oldest brother, who's an entrepreneur. He suggested writing a business plan and, you know, went back and I was like, here's my business plan. And he was like, tore it to shreds, went back eight times, nine times, maybe the 10th time. He was like, all right, I think you have something. And he was my first friends and family investor. And from there, I resigned from Lily Poulter, where I was at for seven years on the marketing team at six months pregnant with my daughter, with my first child.

7:15So you can imagine all the things going on behind the scenes, you know, with my family's opinions on that and all of the emotions that I was feeling, but I thought I had a good idea. I thought elevated activewear was the future. I saw women wearing leggings far beyond the gym. They were wearing it to errands, restaurants, all over the place. The light bulb moment that I felt in my gut was New Year's Day in Rittenhouse Square. I was at a restaurant. Everyone's clinking champagne, celebrating the new year. I looked around and everyone, it's a pretty nice restaurant, and nine out of 10 women were wearing leggings.

7:50I was like, this is a movement. She's looking for more elevated options. She can't find it in the market. I'm that consumer. I can't find it in the market. If I don't do it now, someone else is going to do it. So I, that's when I resigned in February of 2018 and made the jump and transactionally, we launched the company September of 2018. So I was off to the races, you know, since early 2018, I had my daughter in May of 2018. So had her real quick. And then we launched September 4th of that year. So I think it definitely, when you look back, it's like, bam, bam, bam. And I think my family behind the scenes was like, holy smokes what she what is she doing just do it one thing at a time but listen the timing made sense I'd been thinking about this elevated polished activewear for a long time I was a consumer looking for my for myself and I was like if I don't do it now I'll never do it so

8:35Kara Goldin:and I dove in headfirst so how many SKUs did you launch with in that September 2018 launch of Addison Bay okay so this is the most fun part so we started as a curation model so in the building at Lily, like honestly, the marketing team sat as far away from the design and production teams as you could possibly think. I knew nothing about design and production, wrote in the business plan, year four or five, I'll start our private label, private label. And we started with a curation model. So I was curating elevated activewear brands from Australia, London, LA, New York, one-stop shop, and saw a couple other players in the space, felt like I could do it very differently and bring a whole different lens to it.

9:18So we started with a curation model. I think I had 28 brands at launch. And I was like, I'll start this private label once I understand my who my consumer is. Three months in, I knew my girl, like I knew who my consumer was, I knew how she what she was looking for. I couldn't find what she was looking for in the market, which again, were these really polished, elevated pieces that could take her for all parts of our day. She wasn't necessarily working out, or really like being that active. She just wanted to be functional, uncomfortable, but look, put together, polish, and really feel effortless.

9:50So I started designing our private label and I launched it in December. Our private label, again, now it's fully Addison Bay. So full 180 pivot in this business model. But we launched our first private label December of 2019 and it was four styles, a couple of skews in each style.

10:06Kara Goldin:And so were they tops, were they pants like a mixture of both yes so the everyday legging still exists today bestseller everyday pullover still exists today bestseller our everyday long sleeve and an everyday tank so like really just your the building blocks of like what i was going to build in the future um have we made fit tweaks absolutely because i didn't have a tech designer at the time and we were fitting on ourselves um but it was we we knew the like the what we had in mind we had the foundation. It was rock solid. We knew what she was looking for. She wanted that like basic legging, but she wanted it to be a little bit more elevated or a little bit more polished or have a little more style, but not be completely wacky print all over.

10:47So we gave that to her with our signature six stripes around the one leg. If she's walking down the street, you're like, that girl's wearing Addison Bay. So I think that is really what I was looking for in the early foundation of what the private label was. And now that is exactly the same of what you see. If you see someone wearing Addison Bay on the street, you know it's Addison Bay. You're not like, is that a black legging that could be somebody else? It's never going to be that. We don't sell that. We really sell things that are very eye-catching, but are also elevated and polished. You don't feel like you're too wacky or too crazy or too out there.

11:20Kara Goldin:Yeah, definitely. So it's so interesting that you started with private label. So many people end up starting with the brand and then they move into, you know, to get volume. They're doing some private label. So how did you make that decision that you were going to start in private label? And then how long did it take you to actually shift into saying that we're going to do, Addison Bay is going to be the brand? Yeah. I think December of 2019, when I launched that first, it was four styles, a couple of SKUs, a couple of colors in each style. I think it was 18 % of the assortment at the time when I launched.

12:04And we launched, we had to obviously, I think it was like 100 to 150 minimums per each SKU. And I completely sold out within a week. And that was hundreds of units, over 1000 units total. And I saw all the other brands starting to collect dust on the shelves. And I was like, hold the phone. I think I have something here. Like I think I really, I was looking for it as a consumer. I knew she was looking for it as a consumer. She was talking to me. She was telling me, and I think we solved something. Again, looking back, it wasn't perfect because now I'm such a perfectionist. But it really did solve a need of that 7am to 7pm, that really like modern woman looking for the modern wardrobe.

12:46Mind you, this is December of 2019, right before COVID. So like, then we even exploded even further in that space. When I launched spring of 2020, right after COVID, it was like skorts and a couple other things that I thought was like perfect for the girl on the go. And it was really going to like dive us into spring. Then racket sports became extremely popular during COVID. And then that exploded. And we were probably 38 % of the assortment was Addison Bay. And that's when I was like, all right, I got to shift the business model. I need to do a complete 180. We're not going to carry these other brands anymore.

13:19So I let those sell out. And then I kept designing and producing into the Addison Bay brand. So now the company is fully Addison Bay. I 180 the business model extremely quickly. So many great things came from that, right? Like margin, so much better. Marketing was way more fun. We were marketing our own brand. Like that was as a marketer myself, that was so much more fun. It was such a differentiator. Like there were just so many great things that came from it. One not so great thing that I didn't think of at the time, but Naivete is my best friend, was the cash flow. So the cash flow crunch was very real.

13:56So I was taking in these other brands, I was paying net 30, even net 60 for some of my brands. I got to put them on the site, sell them for a bit and collect some cash before I even had to pay the brands for the goods. Then I completely shifted business model. I had to pay these POs nine to 12 months in advance. With COVID happening, you kind of had to pack in a little bit more buffer with production because there were so many production problems. So then I had to pay all for all of these goods over a year in advance. So that became a little bit of an issue. I didn't realize that at the time. And we were very, very tight on cash.

14:30We still, by the way, or we're doing extremely well, especially this year, it's been an exceptional year. And we're still tight on cash at times. Like it's still gonna happen with the growth. It's kind of part of it. But that was the first time when I pivoted the business model. I was like, this is amazing. And look at these shelters and the Addison Bay labels in there. Like this is ours, like so many great things. margin being probably by far the best. But, you know, that cash flow crunch, that was very, very real. And navigating that was, you can't go to business school for how I navigated that.

15:02You got to just be tough and gritty and very solution oriented.

15:07Kara Goldin:Yeah, definitely. So when you think about those, I mean, I'm sure the first time you hit that milestone and you started to realize how critical it is to be aware of the cash flow side of the business. When did you realize that this was more than just an idea, that this was that Addison Bay, you've shifted from private label into really focusing on Addison Bay as a brand, but But when did you decide, we're going to make it? Like, this is really like, this is, I'm glad I did this because there's a lot of scary nights that happen along the way. But you finally just make the decision or have the realization, I should say that, okay, we got this.

15:59Yeah, I think so many little stories. I honestly, September 4th of 2018, I was like, we're going to make this. There was no other option. Like we like the day we launched, I was like, this is happening. Blinders on full steam ahead. Like we are making this happen. There's there's just no other option. So truly, that's like always been my my mentality. And thankfully, I have an amazing husband and siblings and family that are in my corner and believe in me big time. So during those lows, those are my go tos. And those are my people that I go to just to kind of rally me out of that. And then I'm back to it.

16:34I think like a story that sounds funny, but I was like, oh my God, we're going to make it. I was in the airport in Nashville and I saw a girl wearing head to toe Addison Bay traveling, which I love when people travel in Addison Bay. It's so perfect. And I was like, oh my God, I love your app. And she was like, thanks. It's Addison Bay. And I was like, actually, you know, I'm like the founder, you know, it's just so funny. It's such a funny interaction. And she's like, what? I love Addison Bay. My girlfriends and I love Addison Bay and this, that the other and I was like kind of walked away like holy smokes I think we're gonna make it like I was like if we were on our mission we're doing it but like it was a very cool moment to be in a different city not have any like relationship with this person when you see people in Philadelphia it's like a friend of a friend a cousin sisters pal whatever it is and this felt very cool and like I remember my husband being there being like oh my god are you okay I was like I am not okay And it's just that little boost I needed to keep going and keep working hard.

17:33And it was very cool. So lots of little moments like that along the way. Honestly, it never gets old seeing Addison Bay in the wild. It's truly one of the coolest parts of the job and just like such a pinch me feeling every single time.

17:46Kara Goldin:I love that story. And I founded a company Hint and the same kind of thing, you know, and it's still happens. still happens. I mean, this summer I was on a ferry out, um, in, uh, going to Martha's Vineyard and somebody was sitting next to me and they pull a hint out and I had a hint in my hand and they were sitting next to me on the ferry and they were like, Oh, you drink the same thing that I do. And they were like, you know, where did you get it from? Don't you love it? What's your favorite flavor? And my friend was, my friend was like, did you know she's the founder? And they were like, stop.

18:26Kara Goldin:Like they're, they're like, this is crazy. And, um, you know, it's those stories, right? Where it's, yeah. And especially when, like you say, they don't know you, um, you know, and they're just really enjoying the product and, and, uh, it's definitely, it's, it's, um, it keeps you going, right. Especially on those hard days. Yes. It definitely keeps you going. I just actually, another small one I ran into two weekends ago, I was running around with my kids, ice cream all over them in Newport, downtown Newport. And this amazing woman came up to me holding her phone. She's like, you're the founder of Addison Bay, right?

19:02Like, look, there's a picture of me wearing Addison Bay right here. Like, and all these things, my kids are covered in ice cream. I'm like, oh my God, I'm mortified. And my husband looked at her and was like, you have no idea like how much this just kept her going. This pushed her forward. And you're so right. It's just that little oomph you need at the end of the day. And it never gets old again, ever.

19:20Kara Goldin:What was an example of maybe a product that you were askew, that you developed, that you thought, this is going to kill it. And then it just didn't work. I had the founder of Bowl and Branch on, and Scott was so funny. He was like, oh, that's so easy, bed skirts. He was like, I grew up in a house where my mom had bed skirts on all the time. I'm like, we got to have bed skirts. And he said, and guess what? But people never change their bed skirts, right? Very rarely. So he was like, I think we still have bed skirts from like that first run of bed skirts. And like, we just cannot. He was like, we can't get rid of the bed skirts.

20:02Kara Goldin:He was like, we like them. They're great. People love them. But we ordered way too many bed skirts. Oh my gosh, that's too funny. Yes. How much time do you have? Because there's been so many like mistakes and misses along the way. I think for us, when I look back, one product class that we really don't carry anymore is sweatpants. So I thought it's an active wear brand. We need to carry sweats for that athleisure piece. Our girl is not leisurely. She's the girl on the go. She's doing one zillion things. She cares about looking put together and polished and elevated. And sweatpants are a bit more loungy at home.

20:38And yes, there are sweats that people are wearing out and other people are doing those great in the market. That is not Addison Bay. our girl really wants to look polished and put together and sweats just really did not sell well for us at all our sweatshirts are amazing they're awesome third layers but our sweatpants really were just a swing and a miss and i kind of it took me a few seasons to learn and i was like all right we're gonna let other people do this this is not our category we're excellent at skorts and active dresses and things that other people aren't doing we're playing in our own sandbox there but sweatpants are not our thing and i'm a okay with that and um i think that's fine But that realization, it took a little bit to get there.

21:17And did we have to mark them down? Sure. But again, like you kind of just have to learn through trial and error. I would have never known that. So I think I don't regret it at all. It's just sweatpants are our bed skirts.

21:30Kara Goldin:Yeah, I love it. So when you think about the go-to-market strategy, I mean, you initially launched with the private label and then you moved into the brand. You were selling direct to consumer. did you think about like your retail relationships? You have a store now in Philadelphia, but how did you think about how you would get to consumers? I mean, it was a funky time too, because not too long after COVID hit too, where stores were really impacted. But was your go-to-market strategy kind of a blended or did you really stick to direct-to-consumer and your own branded stores? Yeah, I think we stuck to direct-to-consumer in the early days.

22:17So like in the business plan, again, I go back to that business plan, which by the way, you can chuck that business plan out the window. Like it is no longer relevant. I've changed so many things in a good way, pivoted so many ways. We wanted to be, I wanted to be 100 % direct-to-consumer online and then look into stores down the road. My store strategy is honestly, if the right opportunity comes our way or if we find the right opportunity, then we'll take it. But I'm really not hunting down stores. I'm not trying to open 20 stores a year. We're on the main line in Soroban Square. We have a seasonal store in Avalon, New Jersey, which does a lot of work in the summer.

22:53And then we're opening Naples for seven months this winter, which will be great. So we're in some right spots. So that's kind of my store strategy. And then wholesale. We're less than 20. We're about 80 % direct-to-consumer, 20 % wholesale right now, give or take, and our wholesale strategy, I really wanted to get the product right before I put it in wholesalers' hands. I felt like we needed to fine tune a little bit in the early days with our private label and gain some street cred and get it right. And before I was going to Nordstrom, Shop-Up, Dillard's, Bloomingdale's, I had to get our product right because I knew if I sold them our product that didn't fit right or it wasn't the right designs, they would carry it for one season and drop it.