‘It’s very cult’: the bizarre $ 1 billion drop in fashion company LuLaRoe | Documentary

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Roberta Blevins first heard about leggings in the fall of 2015, in a maternity-themed post from another Facebook group member. They were noisy, butter-soft, interesting patterns – functional clothes for chasing young children, accommodating body changes after birth, and cute enough to be socially acceptable outside the home. The woman who advertised the leggings said she bought them wholesale from a company called LuLaRoe and sold them for double the price.

Blevins was intrigued. She was struggling with the alienation of young motherhood and looking to supplement her family’s income, and LuLaRoe offered an alluring and calming promise: sign up to become a retailer, and you could run a successful virtual store out of your home. while being present for your children.

LuLaRoe seemed to offer “this integrated community, where I knew I could have instant friendship,” she told The Guardian. As Blevins recalls in LuLaRich, a four-part Amazon docuseries about the besieged multilevel marketing company, the women of LuLaRoe added her to Facebook groups, texted her, invited her to parties that also served as a fashion sale and flooded her with encouragement. In March 2016, Blevins paid $ 9,000 to become a LuLaRoe consultant and receive a first package of clothes for sale.

At first things turned out well – she was excited about the clothes and made money selling LuLaRoe on Facebook from her home in suburban San Diego, California. But Blevins quickly felt the pressure of the company’s rapid growth, due to the emphasis on recruiting new “consultants” – people from the “downline” whose start-up costs rose through the ranks as than “bonus checks”. By the end of 2016, what had started in 2012 as a cottage business selling maxi skirts in the trunk of a car by two Mormon grandmothers had reached over $ 1.3 billion in sales with over $ 60,000. consultants – and was the subject of legal action alleging that LuLaRoe founders Mark and DeAnne Stidham misled retailers and carried out a pyramid scheme.

Over the course of four episodes, LuLaRich, directed by Jenner Furst and Julia Willoughby Nason (the creators of Hulu’s Fyre, on the spectacular collapse of the fraudulent music festival), examines the high-speed growth of a company that has attacked in the sense of millennial women, mostly white. aimlessly, repackaged the “have it all” fallacy, and covered thousands of debts and broken promises as the company’s top executives raked in millions. The company appealed, Furst said, to “Central American millennials who do not have the same opportunities as their parents, who face many different struggles, who are sensitive on the one hand to the family structure. patriarchal nuclear but also the pitch of being a girlboss and being empowered and being a feminist who sells these leggings ”.

Blevins, like several of LuLaRoe’s former consultants who appear on the show, was initially convinced by the promise of running his own business. The company highlighted the benefits of not only being a LuLaRoe retailer, but a member of a movement – a “boss babe,” “a part-time job for a full-time salary,” contributing to the company’s income. cleaning without going to an office. Or, as Mark tells Nason and Furst in the first episode, “Take your creativity, your passion, your enthusiasm for life, and here’s a place that’s pure meritocracy. “

“They’ve seen me, they’re like she’s bubbly, she’s energetic, she knows how to use social media, she’s an asset in getting things done,” Blevins said of the process of preparing for “bombing d ‘love’ that convinced her to join LuLaRoe. “At that point, I was just another walking dollar sign.”

Slowly, the inconsistencies began to accumulate. Blevins would go to the “home office” in Corona, Calif., Or attend corporate events, which increasingly took on the impression of pop religious festivals (corporate events included performances by Kelly Clarkson and Katy Perry), and Mark began to recite passages from the Book of Mormon. “I thought we were selling leggings?” Blevins remembered thinking. “It just seemed strange.” Blevins received an order for merchandise that reeked of musty; the quality was slipping and some leggings were poorly designed, with prints that looked like anatomy at the crotch. Now, with several consultants downstream from her, Blevins took the questions up the chain, “and they would give me an answer that made sense,” she said.

Roberta Blevins in LuLaRich. Photography: Courtesy of Amazon Prime Video

“You reach inside the organization [for answers]. You do not go outside the organization for information or to get your questions answered. It is very cult.

Through interviews with former and current consultants, employees, and even Mark and DeAnne themselves, LuLaRich takes a bird’s-eye view of what Blevins couldn’t see at the time: the company, allegedly designed to earn money. money not on clothes but through unsustainable recruiting of new members was collapsing under its own weight. Mark and DeAnne, who married in 1998, deposited LuLaRoe in 2013 and endowed him with members of their large extended family. In 14 months from 2015 to 2016, the company grew from $ 70 million in revenue to over $ 1 billion. The payoffs for those who joined the business early, and whose descendants flourished in the thousands, were astounding: some in the series claim to have received bonus checks ranging from $ 20,000 to $ 70,000 per month.

Meanwhile, the majority of LuLaRoe consultants struggled to make ends meet – encouraged to go into debt and struggling with merchandise they couldn’t sell. With a glut in the market of LuLaRoe consultants, most have cracked under the weight. “A lot of people lost their marriages, their lives were in ruins, people were selling breast milk for start-up costs – are you kidding? LaShae Kimbrough Benson, who started as an administrative assistant at company headquarters in 2015, told The Guardian. “People were taking loans, all kinds of things. And [Mark and DeAnne] I knew that. “

The imbalanced margins were due to the design of multi-level marketing companies – essentially, legal pyramid schemes under the pretext that they are selling a product rather than a membership – according to experts featured in the series such as Robert FitzPatrick, author. from Ponzinomics: The Untold History of Multilevel Marketing. Legal MLMs must have a buy-back policy and prohibit the purchase of new inventory until retailers have sold 70% and have at least 10 new customers. As Benson and other former employees recall, LuLaRoe more than sidestepped that line. “We still had a quota to hit,” said Benson, who ultimately worked for the new member “onboarding” team.

The Stidhams argue that LuLaRoe, which is still in business (although start-up costs dropped 90% and the commission structure changed), was never a scam, but a meritocratic scale reflecting the effort. and personal character. The couple participated in an initial interview with the filmmakers to detail the company’s origin story and their entrepreneurial values ​​while maintaining a traditional family structure; they turned down a second interview to specifically address the claims made against the company in 50 lawsuits filed since 2016, as well as some of the most outrageous parts of the corporate culture – which they pressured consultants to do. they are undergoing weight loss surgery in Tijuana and have received bribes from the doctor, for example.

Instead, the company offered a statement presented at the end of the series: “We continue to place more emphasis on our mission to improve lives and strengthen families through the principles of entrepreneurship while continuing to educate them. small business owners on the opportunities found in personal responsibility and individual choice.

A photo by LuLaRich.
A photo by LuLaRich. Photography: Courtesy of Amazon Prime Video

“It’s that double-edged sword of personal responsibility,” Furst said of the statement. “This is what MLMs prey on in the first place: If you’re a dud, it’s your fault.”

Blevins felt the stigma when she started losing faith in the company in 2017. The last drop was to join a Facebook support group for former LuLaRoe consultants and “get all the little things I had complained about, all the questions I had. , all responded, “she said. She read the messages and cried.

“There’s a grieving process you go through when you leave an MLM,” said Blevins, who left LuLaRoe in September 2017 and now advocates against MLMs via his own podcast. “There was a lot of excommunications, a lot of harassment, a lot of people telling me I was crazy, or like ‘You’re going to waste your life by leaving’.

According to co-director Julia Willoughby Nason, the internal pressure to stay silent and avoid “negativity” was something that obsessed many of the women who were on the show. “There was just tons of peer pressure and intimidation behind the scenes, and backlash that these women had already gone through, and I think they were very scared of the repercussions if they were going to have a platform. as a multi-part document. series, ”she said.

In February, LuLaRoe agreed to pay Washington State $ 4.75 million to settle a consumer protection lawsuit in 2019 alleging the company was operating a pyramid scheme that made “inaccurate and misleading statements. concerning the profitability “of being a retailer. Through his compilation of first-person testimony, LuLaRich offers an “invitation, tacitly, to the country’s attorneys general to do what Washington has done, to protect their consumers,” Furst said. In the meantime, the company still promises a “community of lasting love and camaraderie” on a website that features “creating freedom through fashion” at one button: “Join LuLaRoe”.


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