In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that
have shaped their business philosophy.



founder and CEO, Ruby Ribbon


Background:  

Ruby Ribbon is a California-based social-commerce apparel company that provides size-agnostic compression shapewear for women. The company’s products are sold through a nationwide network of stylists who introduce the products via one-on-one experiences in the home.

The Mistake:

My mistake was underestimating the complexities of running a gig-economy company.

My experience before I started Ruby Ribbon was as a typical Silicon Valley high-tech kind of entrepreneur. I did many internet startups and my companies normally provided internet services or software products.

So, I thought I was really experienced as an entrepreneur. I knew how to raise money. I knew how to put together teams.

I created a situation where a woman who sells our product works for herself. She is an entrepreneur. She runs her own Ruby Ribbon business.

The mistake I made in starting Ruby Ribbon was to assume it would be like the other companies I started, where I ran the company and I could control everything—or more or less everything.

When we first went to market with this product, I decided that we would do a controlled beta. I had done this with many companies in the past. I thought we could decide exactly how to go to market, that we could have a period of time where we studied and made sure we were ready, and we had the benefit of rolling the things out over time.

We proceeded with this tidy little notion that we would try to enlist 15 women in the Bay Area and 15 women in northern New Jersey to be our prototype sellers. And within about 30 days we had the 30 women we wanted. 

We never thought of telling them, “No, you can’t recruit others.”

So we went out and found those first sellers, and we got them started.  And about two weeks later I turned around and we were in 13 states.

I vividly remember, it was early December, and I had set a goal for the team that if we had 88 women by Dec. 31, we would all get an extra bottle of champagne to take home on New Year’s Eve.  And I showed up on Dec. 1 and I saw we had nearly 90 registrations in 13 states.

At the beginning that looks like just a quality problem to have. But from the time we went from our picture of 15 all the way up to 88 it was pretty clear that we weren’t ready for that many stylists and we were going to have to run to catch up with them. We realized we were going to have to do some self-reflection on exactly what we needed to do to be successful.

The company’s success means taking on an army that works for itself.

The Lesson:

At that point it was clear that in this business, it wasn’t about what we did, it was about what the women did.

So we began to focus on what we needed to do to make our stylists successful, regardless of the skill-set they brought to the company.

They needed to know how to find a customer base; they needed basic skills in being customer relationship management (CRM) managers. They have to know which customers have bought the product in the past and be able to reach out to them through email and their websites, and tell them that there is a new product that they will like.

They have to be able to mentor other women and manage women and teach them their skill sets.  They have to know how to style a woman and understand all the different body types.

So, there are some specific skill sets that will allow them to earn money that they need to earn and run the kind of business they want to have.

And we now have systems, training, multimedia to do all that. 

The gig-economy companies are today, some of the fastest growing companies. For me, I learned that the company’s success means taking on an army that works for itself, and harnessing that power. It also means you have to make good on the promise that the individuals in that army can get what they are seeking to achieve.

Follow Ruby Ribbon on Twitter at @RubyRibbonHQ.

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