Spanx Founder Reveals How to Build a Billion-Dollar Business
Nov. 29, 2012— -- intro: Spanx inventor and founder Sara Blakely was looking for a solution to unsightly panty lines under cream-colored dress pants, when she had an "a-ha" moment, and spontaneously cut the feet out of her control-top panty hose to create a smoother, more shapely look.
"I wore them that night," Blakely said. "My rear looked firm, my cellulite had been smoothed out, but they rolled up my legs all night."
The quick solution sparked an idea. "I thought, I got to figure out a way to comfortably keep this just below the knee, and I will have a homerun for women," she said.
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With that concept and just $5,000 in savings, Blakely successfully built Spanx, now a multi-million dollar shapewear company. Earlier this year, at age 41, Forbes Magazine named her the world's youngest self-made female billionaire.
Think you have what it takes to build a billion-dollar empire? Blakely offers her top 10 tips for aspiring entrepreneurs.
quicklist: title: Open Your Eyestext: Blakely said awareness is the number one thing entrepreneurs must have in order to spot low-hanging fruit.
"There are million-dollar ideas everywhere," she said.
Blakely said she wasn't the first woman to cut the feet off her panty hose, but her awareness of its innovation allowed her to pursue it as a business concept.
"So I always say that if you're in search of your idea, put on your awareness glasses, look at things differently," she said.
quicklist: title: Differentiate Yourselftext: Blakely said a lot of people, especially stay-at-home moms, come up with ideas out of practicality that are simply better ways of doing things.
Once you come across your business idea, Blakely said you must quickly and concisely differentiate yourself. To do this, Blakely said you must ask yourself the following questions: What doesn't exist? How can I make it better? Why am I coming up with the idea? Is it something I want?
Often times, she said, that can be enough to help you refine your concept.
quicklist: title: Keep It Confidentialtext: It's imperative, Blakely said, that you share your business idea with people who will help you move it forward, like your lawyer or manufacturer. But she strongly advised against sharing it with friends and family.
"I didn't tell anybody my idea for one year," Blakely said, "And I think that could be one of the biggest reasons that I am sitting where I am now."
She said ideas are most vulnerable in their infancy, and that often, out of love and concern, the people closest to you might persuade you to give up on your pie-in-the-sky idea. Blakely said your time is better spent pursuing the idea, rather than defending it.
"Let me quietly pursue this," she said, "And then when I've put enough of myself into it that I won't turn back, I'll tell everybody."
quicklist: title: Show Up In Persontext: While working as fax machine saleswoman in Georgia, Blakely started calling hosiery mills in North Carolina during her lunch hour, but she was unsuccessful in getting traction for her idea.
"I realized the power of in person," she said, "If I even had a remote shot to get someone to make it-- it had to be in person."
So Blakely took a week off work and went to North Carolina to visit mills door-to-door. She faced many rejections, but eventually met a contact who liked her idea.
quicklist: title: Unforgettable Branding (or Name It Wisely!) text: When coming up with the name Spanx, Blakely said she found inspiration in the global recognition of Kodak and Coca-Cola.
"What do they have in common? They have the 'k' sound," she said.
Her comedian friends also told her the "k" sound is known for making people laugh, so she decided she wanted her invention to have the "k" sound in it. "Spanks" came to mind because her product "was all about the butt."
"I knew instantly it was right," Blakely said.
Later she replaced the "ks" with an "x" because she thought "Spanx" would be easier to trademark.
quicklist: title: Perfect Your Sales Pitchtext: When selling your idea to important players, Blakely advises keeping the focus on customer benefits and talking about what's in it for them.
"You know, if I got my 10 seconds with a customer, I'd say, 'I have something that's going to make your butt look better,' instead of, 'I've got a product and it stops here and it starts here,'" she said.
Blakely said she successfully landed her first order from Neiman Marcus by taking the buyer to the ladies restroom to show her the benefits of Spanx in person.
"She goes, 'I get it. It's brilliant. I'm going to put it in seven stores,'" Blakely said.
quicklist: title: Be Seen or Dietext: Once you have made your idea a reality, ensured it's scalable and secured your first order, Blakely said you might think you are golden, but that's actually when the real work begins.
"I immediately went to the store to try to help the sales lady sell it," Blakely said, recalling her first order with Neiman Marcus. "And I realized my biggest issue is where I'm located -- it's placement."
Initially, Blakely said Spanx were allotted one hosiery pocket in a back corner, but determined to control sales results, she surreptitiously moved her product closer to the check out.
quicklist: title: Visualize Your Successtext: Blakely, who is a strong believer in visualization and the power of thought, said she has "manifested almost everything" that has happened to her in her life.
Blakely said it only took one time for her to cut the feet off her panty hose to know it was a great idea because had been doing "mental pre-work."
"I'd been doing visualizing, being very specific, asking for an idea that would change my life and change other people's lives," she said.
In college, Blakely said she envisioned herself on Oprah's couch even though she was unsure of the reason. As fate would have it, years later, Oprah named Spanx one of her "Favorite Things" of 2000 and Blakely's business took off.
quicklist: title: Budget Your Time for Good Work-Life Balancetext: Blakely, who is married with a toddler, said her work-life balance "was a mess" during the first year and a half of motherhood.
"I was really struggling with it because it just arrives in your life," she said. "You haven't been training for it."
Through trial and error, Blakely became wiser about prioritizing her time and delegating.
"I block off chunks of my day that are dedicated to Mom and chunks of my day that are dedicated to work," she said. "And that has really calmed my thinking down and made me feel less anxious."
quicklist: title: Once You're a Success, Give Backtext: After successfully launching Spanx footless panty hose, Blakely said the light bulbs just started to go off.
"With just a little bit more love and care, I could add a lot more comfort and still give women the results," she said.
Over 13 years of business, that thinking had led to a shapewear empire that now includes yoga pants, swim suits and even Spanx undershirts for men.
It has all inspired Blakely to give back. Since launching the Sara Blakely Foundation in 2006, Blakely has contributed over $1 million to causes that support women. She also spearheaded a program called "Leg Up," which spotlights female entrepreneurs who have the potential but not the means to grow their businesses. Recipients receive personal mentorship phone calls with Blakely, as well as advertising in the Spanx catalog.
"I think the world becomes a better place when women are empowered and women can claim their own spot and have their own business," she said. "I love working with women and I love helping women and whatever I can do to give them a boost."
Blakely said it's her way "to pay the Oprah moment forward," and said she believes women helping women in business is good karma.
