Suzanne Lerner – Co-Founder & CEO of Michael Stars

Episode 220

How do you build a company that lasts? Listen and find out how Suzanne Lerner, Co-Founder and CEO of Michael Stars, started the iconic clothing company with just one shirt design in 1983 to build the iconic brand that it is today. Hear the story on this week’s episode of #TheKaraGoldinShow

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Transcript

Kara Goldin 0:00
I am unwilling to give up that I will start over from scratch as many times as it takes to get where I want to be, I want to just make sure you will get knocked down. But just make sure you don’t get knocked down knocked out. So your only choice should be go focus on what you can control control control. Hi, everyone, and welcome to the Kara Goldin show, though, 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. Let’s go. Hi, everyone, it’s Kara Goldin at the Kara Goldin show. And I’m so excited to have my next guest. Here, we have Suzanne Lerner, who is the co founder and CEO of Michael stars. And I am so thrilled to have her we actually met on this group that we’re part of called the list yay for the list filled with amazing, amazing, iconic women that are really trying to learn and and network and it’s it’s super, super amazing. But I was so excited that Suzanne joined the list because I have followed her brand for years. So this episode is going to be an amazing learning session. But also, how do you build a brand that stays one that is actually founded in 1986. And she founded it with her husband, and just a batch of screenprinted T shirts. And I’m super, super thrilled to hear more about how she’s built the company and all the the waves that she’s been challenged with over the years and gotten through, as everybody knows, through my book, undaunted, I mean, that’s something that I really, really, you know, want more and more people to share as well, so that we can all learn through that. She’s also just given back to so many communities, both domestically internet, Internet, and internationally through personal grants and pact investments. We were just talking about getting ready to be core to and she’s got the Michael stars foundation. So, so excited to have you here, Suzanne.

Suzanne Lerner 2:30
Thank you, Karen, I am so excited to and you know what I remember meeting you in line at a TEDWomen conference. Oh, we were standing waiting to go in the door. And I said Hi, I’m Suzanne. He said Hi, I’m Kara and I knew about him water. And it was really exciting to meet you that I’ll never forget that I met you in that line. And you know, I always say to people connect up wherever you are. It’s your network. It’s so great to connect with you on the list. Absolutely. Well,

Kara Goldin 2:56
so talk to me a little bit about we’ve obviously done a little research on you. But like, let’s talk about your childhood a little bit. Like where did you grow up? Did you always know you were gonna be an entrepreneur? What what do you think about what you were gonna end up doing?

Suzanne Lerner 3:13
I don’t think I thought about it. I grew up in a family of I would say that we’re entrepreneurs. My dad was a road rep for jewelry lines. So he was on the road from Monday to Friday, my mom was a bookkeeper. And on the weekends, I’d help my dad I’d file invoices, I’d look at the jewelry, I’d help them tag the line. So I knew that side of the world and I only knew family members that work for themselves. I didn’t really have people that worked in large corporate jobs and thinking about back now I think my dad probably really hated that world and that life so he chose to go on the road and my mom had to work because they didn’t really didn’t make much money. So I was more of a latchkey kid, two older brothers always fighting for myself. But I remember I was thinking back when you I knew I was going to be asked this question at seven or eight years old. I decided I was going to make out a toilet from like lilies of the valley that my mother’s backyard Oh my god. So I must have had this entrepreneurial spirit for a long time. And just always was interested in other people and being out there out. I was really love fashion, but I lived in hand me downs. So I had to make some of my own clothes and wearing blue jeans and nobody’s wearing blue jeans getting expelled from school while actually suspended from school because I was wearing blue jeans like kind of pushing the envelope of things like that. So I think that was kind of how I started out and then I just ended up traveling I dropped out of college. It just wasn’t for me I realized I probably had a DD I love doing a lot of different things. But studying was the best part of it. I love sitting in class and learning and listening. So I worked as a second Terry, and for many different companies like a Kelly girl temp, and then ended up traveling I went to Europe by myself at the age of 21. Came back for some more school and then decided my big dream was to travel Overland. And those days everybody was backpacking. So I ended up in Australia working and then backpacked all the way through Southeast Asia, Thailand, Naipaul and ended up in India, and meeting so many women along the way and working. I mean, I even worked for a German NGO in Nepal, and Bhaktapur, Nepal, typing for them for two weeks, it was so much money was $2 an hour like, it helped me travel for another couple of months until I ran out of money. And then I met a really lovely Indian woman in a small shop in New Delhi, and we became friends. And I realized there were not a lot of women out there in business, but didn’t strike me because I always set out on my own. My mom was really kind of on our own. My aunt had a jewelry business. And she invited me to join a couple of other people in a clothing company, a fashion brand. I knew nothing about it. I loved my 17 magazines in vogue, and I was growing up, but I didn’t really think of myself as a fashion maven, or understanding. So I joined an English woman who was designing and living in Kabul, Afghanistan, a French American guy, who was the financier and another guy who lived in Los Angeles, who had an art gallery, and they were importing jewelry and sweaters from Morocco. And I said, Okay, I’ll do it. And I just said, Yes. Didn’t know how to do it.

Kara Goldin 6:42
What was the name of this brand?

Suzanne Lerner 6:43
The name of the brand was Suzie Wong. This was I was Suzy and Roger was wrong. So that’s how we started our business, and literally knew nothing we had, then then a lot. And Margaret, the designer and the backer broke up. And we were left with nothing but the idea for business. And Raj and I looked at each other. And I said, I met some people in Old Delhi, that have this incredible line of clothing, they export to India to Italy. And Roger said, Fine, he took this credit card, we put it on the ticket, I called my parents and said you did not pay for my college education. Will you lend me the money for this business? And I knew it was a lot of money for them to invest. It was $15,000. And they said, Yes, I, they believed in me. So I get on a flight. And I showed up in India, and I walked up to 19 Chandni choke. So the Sardar still company and walked in the door, and they said Suzy, and they said, we don’t work with Americans. But you we will work with. So they gave me samples. And I went back to Los Angeles, and I went out, we went out and sold them. And that’s how it started. And I would go back to India to check production. We did pretty well, the first year, but then there were quota issues with customs that closed down the entire market from India for two months. And we had we had products sitting in that customs. So I mean, when it finally came out, we had to close the business failed, but I started getting jobs in the industry and learning the business. Wow. So I guess it was my college education.

Kara Goldin 8:25
What do you think was the big one? Maybe your first big failure? Right? What did you learn? Like, what do you remember? Like thinking back as the Steve Jobs used to say, like, the dots eventually connect? Like, do you think that there were key points there that sort of made you feel? Like I mean, probably a lot of points, but But what what was like that one thing that you feel like was kind of the nail in the coffin.

Suzanne Lerner 8:54
And I was so young and unaware, I It’s really knowing everything about what you need to know, the reason why it failed is because I didn’t understand that the quota was being counted when it came into America. And then India was giving quota away and not keeping track. So I think it’s it’s knowing enough about your business and all the things around you and all the other companies around you that form part of your business, that you have to know everything as much as possible.

Kara Goldin 9:23
I think that’s so true. So Michael stars so So you met this guy, right?

Suzanne Lerner 9:29
And yeah, you know, I’ve in 1983 I stopped working for other big companies that just was fed up I really realized I needed my own business. So and one of my old bosses that I reached out to on LinkedIn, he said to me, you are aggressively so smart but so nice about it, that you would have done a better job than your the guys you reported to. He said I’ll never forget you. I thought that that was like a long time ago. I started my own weapon business, independent ramp, and I did that for three Until I met Michael, I continued that business into a national repping organization with four national showrooms, but started out in a 210 square foot showroom, going on the road selling. And Michael stars came about because I was sitting in my showroom, and this guy walked in with screenprinted sweatshirts. And I liked them. But I had just gone into business with someone, it was going to be difficult to take on another brand. But it kept thinking about and thinking about, and he really was a good salesperson. And eventually, I got up the nerve to call him back to tell him I didn’t want to wrap the line, but I asked him on a date. So it’s 34. So I didn’t I mean, I don’t know we just like I don’t know what it was. And he was like, Who is this? I just want somebody to wrap my line. So we went out to dinner a couple days later. And that was it. A week later this screen he had the artist put the screen they weren’t screen prints are hand painted on T shirts. And I said my god, I can sell these. So we put them up and customers that in the old days it was Fred Segal and Barney’s and Bloomingdale’s on top of the theaters that stores that some of them don’t exist anymore. Came in the showman bottom. So we just became this iconic brand. Every celebrity was wearing a printed t shirt with a blazer over it. They were big and oversized. They were as as the industry calls in blanks. We didn’t manufacture them we bought them from the market which so many entrepreneurs now are doing with their own t shirt brands sure to get started and that’s how we started. And we built it up in two years. It was just amazing. And then people were well we like the prints but so we started just garment dyeing. Solid T shirts. Yeah, we can often show to the family fit a family factory in Pennsylvania who we use for many years. And produce everything in America. And I at one point we have 28 to 32 colors a season. Like living room table was like covered with colors all the time. And I would go out and buy things I liked him were cute and we create styles around it. And they were all one size Wow. So it just became this iconic brand and it we had some incredible years of business. And you

Kara Goldin 12:18
have many celebrities I feel like Madonna and I have so many people

Suzanne Lerner 12:24
and he are everybody was wearing Michael stars T shirts. It was fun.

Kara Goldin 12:28
Yeah, no, it’s just absolute and I certainly bought my my fair share and and my parents bought me my my fair share back in back in the 80s for sure it was the hottest. Absolutely the hottest thing. This episode is brought to you by HelloFresh. Winter is here and going to the grocery store and the cold feels like even more of a chore when you could be warming up by the fire inside. Well with America’s number one meal kit you can have ingredients brought right to your door, saving you the hassle of a trip to the supermarket. HelloFresh provides fresh pre portioned recipes delivered to you to make home cooking simple, more affordable, and most importantly fun. Plus Hello Fresh doesn’t just save you time spent on shopping for food. It also helps you cut back on PrEP. With Gore may customizable options that can be ready in 30 minutes or less. It’s never been easier to put restaurant quality food on the table without over buying groceries or spending money on takeout. easily change your delivery day food preferences and plan size or skip a week whenever you need to. As someone who’s usually working late or super on the go, I know that having quick fresh meals ready to go in my kitchen can be a lifesaver. Have your food work for you. Go to HelloFresh comm slash Kara Goldin 16 and use code Kara Goldin 16 for up to 16 free meals and three free gifts. That’s hellofresh.com/kara Goldin 16 and code Kara Goldin 16 Have you ever left a meeting feeling like nothing got accomplished? Come on. I know you have. Have you ever run a meeting and felt like you weren’t organized enough or prepared enough to actually know where you were headed? Hmm. Too often, whether you’re leading or just joining meetings can feel disorganized or overwhelming. Luckily, Hugo is here to help. Hugo is the tool that does it all helping you get ready before a meeting, keeping you on track during the meeting and making sure all tasks are in order after the meeting with Hugo. You could store agendas, notes, calendars, tasks, and any other prep needed all in one place. Hugo is no hassle, just easy organization. plus Hugo helps you share anything before and after the meeting in an organized neat way so that everyone can always be on the same page. Make your meetings matter more efficient, take up less time and feel more productive. Join over 30,000 teams and professionals having more productive meetings with Hugo get Hugo free for 30 days at Hugo dot team slash Kara. That’s Hugo dot team. Backslash Kara Hugo dot team slash Kara. This episode is sponsored by TurboTax. People think unusual circumstances means complicated taxes. But for TurboTax live experts, that’s what makes things interesting. Maybe you inherited a condo and are renting it out. Or maybe you’re getting paid in crypto and aren’t sure how it’s taxed. For TurboTax live experts unique situations can mean an even greater refund TurboTax live can match you and the right expert who has experience in your unique situation and can answer all of your tax questions right from your phone or computer. They can even take care of the whole filing process for you. Whether you launched your own startup or working multiple jobs, and juggling multiple incomes, an experienced TurboTax live expert can help you during the entire filing process, or do your taxes for you from start to finish to get you the tax deductions you deserve. Visit turbotax.com To learn more, you do your thing. They’ve got your taxes into it TurboTax live. So tell me a little bit more about so one of the things I like to ask people as when you’re building a business, everybody faces challenges, I’m constantly saying to to want to be entrepreneurs or or even existing entrepreneurs who feel, you know, like they’ve really failed and they can’t move forward? And can you share a story about where he faced a super big challenge or failure along the way and, and you felt like you lost your way in some way. I’d love to hear it. And also, what you learned from that experience, too, because I think that it’s about getting back up, right. And it’s about figuring out ways to deal with it. And I’d love to hear from you. It

Suzanne Lerner 17:31
is it is so many challenges in life over a period of time for a business 35 years. But the most impactful one, I think was Michael being diagnosed with prostate cancer. And we had run the business together for many, many years. And we decided we weren’t going to tell anybody, and it had progressed too far to be taken care of. So we just figured we’re going to carry on. And her but two years before he passed away, I started working more and more in the company every single day, because I’d been more in the showrooms, along with merchandising, and slowly getting people to kind of know who I were a little bit more because they hadn’t really seen me around as much as Michael was always such a big presence. And it was such a big presence in our company, such a strong personality. And then he passed away. And I just kind of just went back to work. I didn’t know how to cope with it. It had been a lengthy illness, which was good for me because I could start dealing with things. But I would get up at five o’clock in the morning, people would be sending me Facebook posts, messages, I’d get on my patio, I just cry for half an hour. And then I just get up, get dressed and go in the office. Because I needed to be that stable figure for people that were there to know the company was going to go on. And I just loved it. And Mike when I hit such passion and drive for the business that I just knew, I knew it, it meant that and I knew that I was gonna end up being 100%, owner of the company. So I looked around and people were like in their little silos. They all had different ideas of the company. Business wasn’t that great, Mike, we kind of let it fail a little bit as Michael was sick didn’t have new product categories. And so I walked in the door and said, I’m not going to let this company fail. I could have closed it. And I would have been fine. But I had 100 people that work for me. I had hundreds of specialty stores that counted me and their employees and my manufacturers and my contractors and there were 1000s of people that counted on me. And I was determined to rebuild the brand. So I started doing I started looking at what we had always done on Michael stars and said, What do we need to do? Let’s look at every single process, every single department how we work, and we made a lot of changes and the naysayers became the champions for me. So it was really building confidence within my own company. And then we realized that I had to build confidence in the outside world, millions of women that have bought Michael stars that hadn’t really cared about it for a few years. So we have a nice business. But it’s it wasn’t where it was. And I was determined to make it and to refresh the brand. So we hired a company to help us rebrand. And then I realized I needed venture capital money, because to rebuild it, you needed money, I needed a new platform I needed to get on Shopify, I needed to redo all that I need to see of new product and people in social media, all the platforms were starting out. And I just couldn’t take venture capital. We had we had almost sold the company, once very, very close to signing a contract. And we just woke up and said, Why are we doing this? Yeah. And we just didn’t, we just didn’t want it. We wanted to remain a smaller company. But we left our employees and we loved what we did. And we started to many companies getting bought. And then people getting booted out entrepreneurs and founders, and there were less people like us in the marketplace. So I just took my CPA, talk to my CFO, and my CPA had been with me and Michael for years and years and who said you can do it, go ahead and do it. So I have this backup of people that were my champions, and I just gave a lot of my money, a lot of my savings I just believed in and I continue to do it for five years. And now, when COVID hit all the people I had helping on merchandising side that didn’t work out, I was in that factory making masks the next week, I was back in that design and merchandising room. I rebuilt styling. And last year 2020 Our econ business exploded, we went up 95%. In 2021, we went to 45%. I mean, and even our wholesale business is crazy. This year, we are 25% year to date ahead of last year, it has been a complete turnaround that I’m so proud that I’ve been able to do. And I feel so empowered. It’s funny, I think as women we just never quite have that feeling. Yeah. And I, I embraced it said I’m done. I’m done with like feeling like I’m I don’t deserve it.

Kara Goldin 22:18
That’s amazing. Well, it’s it, you have done an amazing, amazing job of building it, you talked a little bit about sort of some of the strategy stuff that you changed, and especially during COVID, you were partnering with other brands, I always call it borrowing equity from from other brands to kind of build builds more on your brand. So one of them was Stitch Fix, do you want to talk a little bit more about how that

Suzanne Lerner 22:48
that a wonderful brand box founded by a woman, and it was four or five years ago, and they came to us and said, We want to want you to be in our box, I thought what a great idea. It goes out to these women and they get to see my brand again. So we started doing business and over the years, it’s grown and grown. And I know it’s one of the reasons why. Because consumers are finding my brand again, because there’s been millions of boxes going out the door with it. So we’ve built it up to a really fabulous partnership. We really believe in our brand. We don’t do private label. We do our label. We don’t get involved in that other other kinds of businesses. And it’s interesting because people don’t ask me for that. They want my brand. And they realize it’s I’ve got they’ve got the authenticity of the brand. And then there’s a company called ever Eve. And this was a young woman, Ben buyer and her husband who lived in Minneapolis, who for a year tried to get us to sell her we were selling other retailers, which we did. And finally we just said okay, you can have our product. There now 100 doors, huge online businesses, care about their employees care about people. We’re a premier brand on their site. And then we still have all of our specialty stores that we sell to. But what’s exciting collaboration we’re doing now is with upside with threat up, which is this fabulous site. They’re selling used items. And I went on two years ago to find some old archival Michael stars because we have a big archive, but I thought you know what’s out there. And I went on Poshmark and eBay and thread up and we’re buying my T shirts for 10 and $15. They all were the old sales. I knew the branding that was like over 20 years old. And I probably bought 50 pieces and every one of them I could wear that’s amazing. So you know you think of this role of sustainability and how everybody’s on that road to it. And I’m like, wait a minute, my things last for 25 years. Yeah. How much better? How much more sustainable? Can you be? There’s no all this landfill with fashion products that you hear about the waist?

Kara Goldin 24:50
I think you’ve touched on a few of these points, but one that I think so many people are interested in so you’re a 30 year old 30 Plus two year old brands. So what advice would you give people to maintain a brand grow a brand that really is going to have staying power? Quality? Obviously, I think is is something that is absolutely critical. You also touched on just getting to know your consumer, because that consumer will change over time to and new trends, new partnerships, etc. But what else would you say?

Suzanne Lerner 25:27
Yeah, I mean, all, everything you’re talking about is so important. Definitely knowing my customers. And I still attend trade shows. Because it’s nothing like talking to a buyer, I still walk into specialty stores to carry my product. Talk to people who approach me, I think knowing who you’re selling to is the number one thing you should be thinking about. Because it’s not what you think’s going to be in the market. It’s what they’re going to want to see in the marketplace. So true. So that’s, that’s really key. And making sure the product is out on brand. And for me in fashion on trend, we don’t really produce trendy fashion that will go out of style quickly, like fast fashion. But people want to follow when animal prints around, they want to see an animal print for Michael stars. And when joggers were happening in tie dyes, we were the first on the market, one of the first people in the market with it. And actually what’s so great is when COVID hit on our site were plenty of lounge outfits. And businesses kind of exploded because everybody was looking to buy clothing to wear at home. And and the other thing is, is that I think a lot of women were doing their own laundry, they might have used to be going out to work and having somebody help them through and all of a sudden they were home doing their laundry and like whoa, Michael stars throw in the washer and dryer, I can look great on Zoom call. And it’s great for young mothers because the baby’s stuff all over, they can just throw in the washer and dryer. So that that I think is is really key.

Kara Goldin 26:51
You and I were talking for a few minutes ahead of time about some of your philanthropic work and and your belief that that as an entrepreneur being really, you have a louder voice in many places, or you can have a louder voice and you’ve been an activist, philanthropist, sir, tell me how all of that sort of fits together.

Suzanne Lerner 27:17
You know, I, I realized that Michael stars has a mission. And it’s not just producing great T shirts that make people happy. Because we did realize in the end, while we really make people happy, they love when they come up to me and say, Michael stars, oh my gosh, I guess it’s a happiness factor there. But besides that I I can talk to people I can communicate I’ve got I can build a bigger community to talk to them about what I do, what our foundation does, and talk about the issues that I think are really important to save our world no just equality for women. 70% of people think that we are in the Constitution, and that we have a totally equality with men and do not understand that we just have some laws that are protecting us. So there’s nothing protecting us. Yeah, that’s one of the things and then supporting all these small organizations of women, led nonprofits that do such amazing work in our communities and around the world. You know, whether it’s voting rights, or reproductive rights, or just helping out in their communities, mentoring kids, all of those things, people don’t know where to go to be able to do it themselves. So I realized I can bring my passion and my experiences in those worlds like going to Haiti after the earthquake and, and being able to mentor young women and help them find their passion. Yeah. Because everybody’s so busy, they’ve got kids, they’re running around, they’ve working two jobs, and how do they find things that they’re interested in and issues they’re interested in, it’s through social media now they don’t pick up a newspaper to read anymore. So trying to work with our authentic influencers, to who care about the issues that we care about, and promoting the foundation. So it’s it’s an exciting, exciting place to be and realize that the future lies in that like we’re, I just believe a brand should be more than just a brand. I mean, you should bring your your business acumen into it. But we should just be more about them profits. I mean, it really is about making a difference we can we can be changemakers through our companies,

Kara Goldin 29:25
I 1,000% believe that as well so so tell me and the listeners how we can follow you and more about Michael stars progress and everything that you’re doing.

Suzanne Lerner 29:38
Well you can find us on Instagram at Michael stars and also Michael stars vintage which is those old T shirts that we brought back again. Suzanne your score learner and we’re offering a discount to all you people listen to Kara’s podcast which I think will be in the notes yeah to help you purchase your your newest Michael stuff. product and I’m so happy to be on this call with you Kara you are phenomenal. I’m I’m so impressed and just finished reading your autobiography, your book. It’s so great. I just recommend anybody coming out and reading it. It’s important book to read if you’re an entrepreneur,

Kara Goldin 30:16
well, I think yours is going to be next I have a feeling so it’s a I mean, you have so many so many stories that I think are really really important for people to hear and more than anything, people to hear these stories to know that they can do it too. So it’s, I really, really thank you for coming on and giving us a little bit of a taste for it. And thank you everyone for for listening. A huge thank you to Suzanne we are here every Monday and Wednesday. And don’t forget to subscribe to the Kara Goldin shows so you’re not missing out on any episodes and give this episode and all episodes a five star gold rating it just helps the algorithms to recognize that we’re out there and and get the latest from me daily on all social channels at Kara Goldin with an AI and a shameless plugs Suzanne mentioned it but my book if you haven’t picked up a copy of undaunted, overcoming doubts and doubters I share my story of how I mostly journey of building hint but a little more in there I think you’ll really get to know me and my family as well just by reading or listening to the book on Audible. And last but not least, hopefully you’ll pick up some Michael stars clothing and and drink some hint as well. You can get that in stores and online. And thanks everyone for listening. Goodbye for now. Before we sign off, I want to talk to you about fear. People like to talk about fearless leaders. But achieving big goals isn’t about fearlessness. Successful leaders recognize their fears and decide to deal with them head on in order to move forward. This is where my new book undaunted comes in. This book is designed for anyone who wants to succeed in the face of fear, overcome doubts and live a little undaunted. Order your copy today at undaunted, the book calm and learn how to look your doubts and doubters in the eye and achieve your dreams. For a limited time. You’ll also receive a free case of hint water. Do you have a question for me or want to nominate an innovator to spotlight send me a tweet at Kara Goldin and let me know. And if you liked what you heard, please leave me a review on Apple podcasts. You can also follow along with me on Facebook, Instagram, Twitter and LinkedIn at Kara Goldin. Thanks for listening

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