Shira Sue Carmi, Launch Collective, Woman Entrepreneur
What I really like about the business that Shira has built is that she is helping give entrepreneurs in the fashion industry the tools they need to build a business. The fashion business is one of the most difficult industries to build a brand. Even if you have built a brand that doesn't mean that you will be profitable. Every season you have to reinvent the wheel. Lauch Collective hand picks the companies they incubate and puts some skin into their businesses. In essence Launch Collective is the angels of the fashion business.
Shira grew up in the southern area of Israel. Her parents were divorced when she was twelve. Both her parents are entreprenreurs in their own right. Her father was always running around the world from building cattle ranches, getting involved in a diamond mine and eventually settling down in Florida where he built a nursery business before retiring and moving back to Israel. Her mother was a doctor and built her own practice and then became the dean of a medical school eventually became the President of Ben Gurion University.
Shira graduated high school and headed directly into the Israeli army. She was selected to one of the few women to go work in the Army radio station. It is one of the leading stations in Israel so it was interesting and fun. Many of the people who had worked there went on to build and lead some of the largest of communication companies in Israel and around the globe.
After the commitment to the army ended Shira had the opportunity to come to the US and get her green card through her father. She figured why not, I could go and work in the arts. She got a the plane and made a list; get a job, an apartment and some friends. She got an apartment through the Village Voice. She walked the streets of Soho stopping in gallery after gallery until she found a receptionist who was leaving and she took her job. The gallery was Jack Tilton. She stayed for a year and decided to go to college.
Shira got into NYU and figured out how to complete her studies on visual culture in three years while working at another gallery, the Dietsch Project. Once she graduated she realized that she did not want to do sales in a gallery which is the logical next step before owning a gallery so she moved on. She landed a great job in the marketing department of the Banana Republic. She she had found her calling in the fashion industry. At the Banana Republic she learned how to spend money, aka marketing but she did not learn how to make it. Shira decided she should get her MBA and figure out the other side of the business. She wanted to stay in NYC so she applied to Columbia and got in.
During her two years at Columbia Shira began to work on projects with a variety of designers. After graduating she had a really good offer to go work at Abercrombie and Fitch in Ohio but she just couldn't do it. Instead she just kept being referred to people to do freelance job after freelance job. It wasn't enough. She wanted to do something besides just run numbers for fashion businesses.
Shira met Dan Otero who had built a line that ended up being a flash in the pan and he began to do projects with small designers from branding, marketing, fashion shows etc. The other person was Rob Spira who was overseeing merchandising, design and manfacturing for Ralph Lauren knits. Together they made a great team. All three brought a different element to the table and the one constant is that they were all entrepreneurial. It was 2005 and Launch Collective was born.
They decided to incubate a few young designers to start. They would help them with marketing, branding, ecommerce and operations. They would commit to four seasons to begin. Shira said what they began to see (although it is always a crap shoot) which entrepreneurs had the tenacity, drive and creative obsession that will allow those individuals to compete in the industry. As a group they were able to help those entrepreneurs understand operational production and how to build a company. In essence they were building a management agency for the fashion industry.
Launch Collectives strategy is around equity and ownership. They structure their deals with the designers three ways; salary, bonus and equity. They have learned how to build a brand with the right talent. That is their value. Remember many of these companies will never realize equity so the deal must be structured right. Their expertise is significant to these young designers as they grow. They understand how to build the right sales and distribution platform and they are helping creative people understand the importance of those skills to build a real business.
The investment side of the startup in the fashion business is not as present as it is in the tech industry. Launch Collective helps their companies get to the $2m annual sales with the hope that at that number they can break even. Then there is some interest for people to put money in. The next level is really to get to $10m annually. The growth curve from $2-10M is capital intensive. $0-2 is about building the brand, $2-10 is about really making an impact and over $10 is the point where other people can begin to worry about the businesses they have helped built. It is then time for those companies to move out of Launch Collective.
I have never seen anything like this in the fashion world. It is really smart. The risk is high but like anything the more they work with creative designers the better they get at picking the right ones that they get behind. Creative people tend to be the most disorganized people in the world and if you are planning on building a fashion line being disorganized is not going to fly. Launch Collective helps the designer grow a company around their talents. Super smart model.