In this great article from Forbes, Anne Glusker looks at Lessons For Success From The Founder Of Sleepwear Disruptor Lunya.
If aspiring CEOs, especially of the female variety, are looking for role models, they would do well to spend some time studying the trajectory of Ashley Merrill, the dynamic founder and CEO of the luxury sleepwear brand Lunya. She had the perceptiveness to see that women’s nighttime attire ran to two extremes: the super-comfy, old, ratty T-shirt or the trying-too-hard, overtly sexy lingerie category.
There was room for something more, something new, and so in 2012 she began work on her idea for a company based on high-end fabrics such as cashmere and alpaca, never forgetting comfort and with a strong focus on body-flattering cuts.
Her initial plan was to distribute online, but she soon saw the need to have a couple of brick-and-mortar shops, which she calls “bedrooms.” There’s one in the Santa Monica neighborhood of Los Angeles and another in New York’s NoLIta with a few more in the company’s future. The company is young, but its growth has been rapid, with year-over-year expansion of 500% since its official launch in 2014 and a staff increase from two (including Merrill) in 2012 to 28 in 2018.
But there have been bumps along the way, of course, and Merrill has learned from every single one of them. Here are a few of her hard-earned lessons:
Take the long view from time to time.
If you’ve never run a company, you may get so immersed in the day-to-day, in operational details, that you neglect the big picture. “Try to find time to ‘pull up,’” Merrill says, referring to her habit of occasionally setting aside time to think hard about the big picture. “As a person running a small company, you have to spend a decent amount of time in the weeds. But be sure to find time to look at the big picture and get clarity with yourteam. It’s challenging, but so important.” Part of a chief executive’s job description at a startup or a small organization is to toggle between the quotidian and the larger, long-term vision. “You have to live between those two. I just take a day and remove myself from the office and stare at my org chart, the budget, the growth plan, all while thinking about the vision.”
Create your team with job functions in mind.
Merrill says that for a long time she always looked at staffing issues in terms of the people she already had, looking at them and then asking herself, “How can I make this work?” But she recently realized she should instead be starting by looking at specific job functions. “Let’s say you have 20 functions – finance, legal, product development, wholesale, retail, creative, marketing. When you have four people, they have to cover all these things. People have to do things that aren’t their core strengths.” Instead, Merrill advises, let job function instead of the people you have on hand inform your decisions about hiring.
Build your brand from the customer’s perspective.
Merrill advises to think about the problem you’re trying to solve. “When you think about building a company early on, never lose sight of the customer’s perspective, never stop thinking about who you are serving. That should guide marketing and all else. You’re not trying to solve a problem for everyone.”
Merrill and her team create a fictitious person, with a specific history – age, pastimes, children, job. “This allows us to be very clear from both a product and branding standpoint. And we’re well aware that our target customer will vary wildly.”
She believes strongly in this exercise. “For clarity of voice and clarity of problem-solving, this guides us very well. Otherwise, you chase a lot of the wrong customers.”
The tricky business of funding.
According to Merrill, there’s no shortage of funding out there, if your idea is a good one and your company is showing revenue. What concerns her are startups with sky-high valuations. “Raising isn’t the hardest part,” she says. “It’s the valuations that concern me – say, $20 million for a $100 million valuation.” Founders in a scenario like that, she notes, “have to know that those investors are looking for something like a half a billion or a billion exit. So, you have to be real about what you’re launching and what the market is for you. You might be setting yourself up for exiting at a multiple-billion figure – but is your market too saturated for that?
Merrill’s advice to would-be founders? Think realistically about your business’s potential and about your market before accepting funding at a sky-high valuation. “Your business may be successful, but not multi-billion dollar successful. You have to make sure your investors are going to be happy with the same outcome you’re going to be happy with.”
Navigating challenges as a woman.
Merrill offers the perhaps-contrarian view that being a female founder can be an advantage in the current environment. “It’s a great moment in time right now because there are VCs out there now investing only with a gender lens,” she says. “In certain segments there is funding available that caters to female-run companies. You still have to have the chops, but if you do, there are people looking specifically for you.”