Victoria’s Secret has developed into a fashion titan, ruling the world of lingerie and acting as a conduit to the top for models. In 2012, the company sold $6.12 billion in product, and was the market leader for negligees.
The company’s progression has more than a few twists and turns, and the brand’s beginning is based on one man’s embarrassing shopping experience.
Roy Raymond, an alumnus of Tufts University with a master's from Stanford Business School, went shopping in ’69, searching for something for his wife. Something classy and elegant, both high quality and sexy. Unfortunately, he struggled in the department store, feeling unwelcome and awkward about approaching a sales professional for help.
After 8 years of paying close attention to the lingerie industry, with $80,000 in capital, loaned half from banks and the rest from family members, Raymond opened the first Victoria’s Secret store.
His goal was twofold: to change underwear from something that was solely “dowdy, practical and a foundational garment,” normalizing the use of lacy thongs and padded push-up bras, and to create an environment where men would feel comfortable searching for products for their wives.
The name, and design, of the store was based on the house that the couple lived in, says Roy’s wife Gaye, who is now associate professor of physical therapy at Samuel Merritt University in Oakland, California.
The company grossed $500,000 in its first year. Over the next couple years, this strong start allowed for expansion into four new stores in the San Francisco area, plus a mail order branch.
By 1982, it had grown to 6 stores, sent out a 42 page catalogue, and grossed $6 million a year. Raymond’s pet policy of targeting a male consumer audience, however, was leading the company to bankruptcy.
Roy Raymond sold his full stake in Victoria’s Secret to Les Wexner for $4 million, a figure that was initially not released. Most, looking back, think that this was significantly too small an offer for complete ownership of a company that grossed $6 million a year.
Raymond tried to start several other business ventures, including a store for children’s products called My Child's Destiny and also attempting hardware through mail order. He was never, however, able to recapture the success of his initial endeavor, and after going through divorce and bankruptcy, committed suicide by jumping to his death off the Golden Gate Bridge in ’93.
Victoria’s Secret has gone in the opposite direction since leaving Raymond’s direction, and has grown into the huge company with a massive social influence that we have today.
The enduring legacy of Roy Raymond to all entrepreneurs is never to tap out too early; even if you are selling the controlling stake in your pet project, hold on to a piece. There is no guarantee that another idea of yours will be as successful, no matter how good it seems, and nobody wants to suffer seeing their brainchild be successful and not earning anything for the creator.
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