Key Lessons From Building Household Brands With Chelsea Grayson
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How do you maintain that speed and innovation as a big company that you have as an entrepreneurial smaller company, which I think helps you become successful in the early days? You're never going to be able to be as entrepreneurial. And the best of CEOs say, oh, I want to maintain that entrepreneurial spirit within the four walls of this company. And, you know, it's like trying to turn the Titanic away from the iceberg. You know, sometimes it works and sometimes it doesn't. It takes a minute to, you know, get things turned. But that's the key, spotting that iceberg

from really far away and starting to turn and starting to switch the engine. So I think the key to being able to be entrepreneurial and to getting things done the way you want to get them done is to have long, long-term strategizing and planning. ♪

My name's Rudy Moore, host of Living the Red Life podcast, and I'm here to change the way you see your life in your earpiece every single week. If you're ready to start living the red life, ditch the blue pill, take the red pill, join me in Wonderland and change your life.

What's up, guys? Welcome back to another episode of Living the Red Life. Joining me today is Chelsea, who is a powerhouse. She's managed some of the biggest companies in America. In fact, first ever female CEO of True Religion, a brand I'm sure you know, American Apparel, and many more. So Chelsea, excited to dive into some of the big lessons from some of these big, infamous brands. Welcome to the show.

Thank you, Rudy. I'm really privileged to be here with you. Yeah, so I'm Chelsea Grayson. I guess I can divide my career up into three chapters really quickly for you. First, I was a lawyer. I was a partner at a big firm. Now I'm a recovering lawyer. So I'm still weaponized, but no longer super dangerous.

And I transitioned from that to become the CEO of three big brands. So first American Apparel and then True Religion and then Spark Networks, which owned a bunch of huge dating apps like J-Date and Elite Single and Silver Single and Christian Mingle.

And now in the third chapter of my career, I'm sitting on boards of directors, mostly public company boards, but some private. So I currently sit on the board of Exponential Fitness, which owns Club Pilates and Pure Bar and Rumble Boxing and Lindora and Stretch Lab and a whole bunch of other fitness and wellness boutique fitness brands. I also sit on the board of Beyond Meat.

which fits in with that whole health and wellness theme. And I've just joined the board of Sunrider International, which is a big MLM company privately held in the nutraceutical space. Previously, I was on the Morphe Cosmetics and Sugarfina board, also the Delta Dental board and a whole bunch of other boards. And here I am, born and raised in Los Angeles, Los Angeles strong. I've got two kids who are up and out of the house, and that's me.

It's great. Obviously, a ton of experience, like I said, which we're going to dive into some of the biggest lessons from. So I'm excited. So I would love to dive into, you know, some of the experience you've got from these big brands. Right. And maybe let's start at the top, you know, with these these bigger companies you are CEO of. You know, a lot of my audience are running 5, 10, 20, 30, 40 employees now.

And I've ran up to about over 300 and it changes at every level, right? Which is what I teach. So what were some of the, you know, the highs and the lows from running some of these big companies and 10,000 staff?

Yeah, you know, I will say that I think first and foremost, the thing that I learned, the most important lesson I learned was that communication is key. Frequent, regular, transparent communication with all

all of the stakeholders. So if it's a public company, that means the market and the investors. It means your lenders as well. And with any company, it means your customers, your clients, your vendors, your suppliers. But most importantly, with any company, but particularly with big companies, especially if you're dealing with, yeah, 10,000 employees globally, it's your employees.

You know, they are your absolute most important asset. I don't have a different way of characterizing it. I don't like the word asset so much in that sentence, but they are the most important thing that you've got in your company. They are the folks that can make or break you. And no employees like to hear about their company and what's happening with their company and what's going to happen with their company from a press release or a leak in the media.

in the media or on social media or, you know, from the CEO being interviewed on some TV show. They want to hear it as much as possible, first and foremost, from the leaders within the company because people don't like to feel like fungible billing units or cogs at a machine or use whatever analogy you want. They want to feel that they're in the know and

that they're at the center of where things are originating. And then they feel like they want to participate, right, in the initiative that you're attempting to implement. And you should lean into that as a leader. Try to communicate with your employees first, whether it's

town halls, whether it's a quick email before the press release is about to go out, you know, whether it's just walking around to the different factories and, you know, different locations that you've got, even retail locations to try to communicate with folks as much as possible, you know, before it hits the public airways.

That's not always a perfect system because with public companies, as you know, if there's material non-public information, there's things that you have to disclose publicly at the same time that you're disclosing it internally. Otherwise, you've got...

you know, a security abroad situation. But people mostly want to hear about it first so that then they feel like they're part of the solution. I think it's great too because, you know, even obviously I run more smaller companies, but even when we've had 100 employees in my company or, you know, companies, bigger companies I've managed with 300 staff,

I've always done a weekly call every Monday and I, you know, appreciate it. It's farther when you're at 10,000 staff, but they love so much, you know, being bought in and, and, you know, we just did for my own company, the start of the year, we did a, you know, big yearly planning session with the C-suite, but then I presented it to the whole company on a zoom and,

And, you know, even the virtual assistants, right? And the customer support people and the designers that you never speak to as a CEO, you want them to feel part of it. And especially when you get big, like you said, they're the front line, right? So if they're upset and grumpy or nervous, someone's walking into one of your stores and gets bad customer service, right? Yeah. I mean, listen, they are the most natural brand ambassadors you've got.

Whether you're a big public-facing brand, you know, or whether you're just a B2B, you know, supplier and vendor or whatever. I mean, the salespeople, right, the people in the stores, the people that are flying around, the people that are participating on social media, if you can weaponize them as brand ambassadors, you're going to be a big brand.

weaponize them with as much information as possible, they will want to be cheerleaders. They will be much more engaged in their jobs. And when the water rises, all boats float. Yes. Yes. I love that. And what would you say, you know, I mean, it's fascinating how, you know, at least for most of my audience as entrepreneurs, that they have to reinvent themselves as leaders because most of them start as solo entrepreneurs.

more in this private sector, self-funded. They get a few staff and then 10, 20 staff and 50, then some get past that. And you have to totally transform. I used to do everything. Now I'm at 100 staff. I don't do anything apart from approvals, meetings, sign-offs, big partnerships and deals. Can you talk to me about what an average day is like of a CEO of an even bigger company at that size?

Yeah, first I want to key on something brilliant that you just said, and I don't want to let it go past because it's a hugely important part of your day-to-day life as a CEO, which is at some point you get big enough

Where you can't, as the CEO, have 18 direct reports, right? You can't have your fingers in every single pie in the company, even though it's your baby. You created the baby or raised the baby, right, to teenagehood or whatever, in young adolescence, you know, whatever it is. You've absolutely got to learn the art of delegation, and that means...

Generally speaking, you've got to hire a great number two. So you'll always have your CFO reporting to you. If you have a chief legal officer, for sure they should report to you. And probably your chief, whoever's in charge of your human resources, whatever title that is, CHRO normally. But then you should have one person, maybe it's a COO or a chief merchant or whatever, to whom everybody else reports at the next level.

Because if you're constantly taking meetings with 18, 20 direct reports, you're never going to get anything done. And by that, I mean a high level sort of strategic thinking that the CEO should mostly be consumed with all day long.

Not meaning that you should be sitting in your chair all day long. That's certainly not what a CEO should be doing. But you shouldn't be consumed with micro details all day. Somebody else should be in charge of the nitty-gritty of the business and operations of your company. So you should be, as a CEO, day-to-day, linked arms with your CFO.

Period. End of sentence. That's one of the very most important things. You guys should be in and out of each other's offices in reality or virtually, however you're running your company. You should absolutely be talking all day long and you should make sure that you've got a strategic CFO who's not just a bean counter. You've got your controller for that or whatever. You've got to have a strategic CFO who understands, all right, it's time to acquire. I should always be looking for targets to acquire. What should I divest myself of or whatever.

we don't really need these locations anymore. You know, let's dissolve those entities and we can do, we can, you know, let those folks go or, hey, you know what, this product line that's been our moneymaker for all these years, this actually shouldn't be in two years when we grow up, this shouldn't be what we're focusing on any longer. Think BlackBerry. You don't see those devices any longer, but you know, that company makes a heck of a lot of money just licensing out its IP.

I think that's so important too for the entrepreneur because, you know, I've gone through having bookkeepers, controllers, then a head of finance and the CFO. And even at the smaller level, the average ones, they just do your books and P&Ls and all your reports. But the good ones, they're making proactive suggestions. And it's so important because you try and do it as the entrepreneur or the owner or the CEO, but they're looking at the data all day, right? So they can write one that flags, hey, this...

yeah, this whole sector is unprofitable or this is like doubled in cost. Did you know that? Right. And sometimes you don't. And it's like because it's these little micro I call splinters in a business that can damage them. So, yeah, I do love that. And most entrepreneurs honestly suck at me included. When I started, we all suck at finance until we get big enough where we have to get good at it. Yep.

And the other thing I think as a CEO every single day should make sure to check in, again, with their chief legal officer and their – call it your CHRO, whoever's running your HR department. Not all day long, and you don't have to get super involved there, but they should be letting you know, generally speaking, all right –

The culture of the company is good. The culture of the company is turning to toxic. We're getting more and more claims through HR with respect to this one particular issue. So a theme is developing that we need to nip in the bud. Whatever the case is, they can give you a general sense of how things are doing and whether your tone from the top is good, is healthy. It's

resonating throughout the company and people are continuing to be happy and productive or not. They're really on the front lines of, you know, are people happy or not? And if not, that's no bueno because that leads to lawsuits and claims against your insurance policies.

And then bad press, too, which we're a big company, right? It's the viral TikTok video. It's worse with social media these days, too, right? Terrible. Yeah, I can only imagine how bad it is. Everything comes out. And then, look, you know, as you're getting bigger and bigger, since we're talking big brands here, you know, and one would only, you know, all entrepreneurs want their companies to be, you know, go from a seedling to being Apple companies.

You know, you got to check in with your board, at the very least your chair once in a while, not every single day, but your board should be in the loop. The last thing you want is to surprise your board of directors with anything. Boards of directors are, and listen, I'm speaking in the first person here because this is what I do for a living now, were crotchety,

cranky, you know, we've been doing this for a long time. We're sort of grizzled. And when we get surprised by something,

We get scared. And when we get scared, we get mad. You know, we don't stay scared for too long. We're angry and we're irritable. So don't surprise us with stuff. You know, give us previews of coming attractions, things that in three weeks you might need approvals on. You can't drop it on us in three weeks. You've got to start to lay the foundation for things. And listen, the bigger you get, there are things that are going to require board approval. You can't ignore that. So I would say stay in touch with your chair, your

you know, regularly as a CEO. Yeah.

That's good because a lot of, you know, in the last few years I built out a board for my business and was, you know, obviously running bigger companies, I had to report to people and that was a learning experience for me. And now, you know, a lot of the entrepreneurs that are growing, I kind of advise a little on even what that is, how to pick the right person as an advisor and all those things. And, you know, it's good training wheels, right? Because as you get bigger, you know, I don't think entrepreneurs listening probably understand this, but

They kind of ruin your company from behind the scenes or can hold you back. And they're, you know, they make a lot of big decisions, which as an entrepreneur is always hard because you get into entrepreneurship freedom. Right. And then a board's there to kind of, which they have to when you get so big, but to keep you and the third parties and investors, you know, keep you in a lane, so to speak.

Yeah, and to your point, you haven't always handpicked your whole board, right? Some folks you may have handpicked, but others, sure. Shareholders who put a lot of money into your company, they'll have rights to appoint one or two directors, and you really don't have a whole heck of a lot of say in it, you know? So, yeah, you've got to learn. If they don't understand, like, just a third-grade level, big company, they take in a big investor, a private equity investor or something,

gets 10% of the company, they get to assign someone that checks that they're 10% and the company is being run appropriately. Is that a decent summary? Yeah, absolutely. And oh boy, once you go public, if you're going to do that, you do that to avail yourself of all the dry powder in the capital markets, of course, and that's great, but it certainly doesn't come without its issues.

you know, men, you've not just got a board of directors, some of whom were, you know, designated as independent. So they're there just to represent all the shareholders and

But you've got big shareholder meetings. You've got folks weighing in constantly. You know, you've got directors who know that they're being scrutinized by the public markets, you know, and so they're really watching it, you know. And then it becomes much, much more difficult to move things along or change things or switch up, you know, and you're going to start to wonder why you went public in the first place.

Actually, I've never gone public, but I had friends that have and several entrepreneurs. It's like always the big shiny object goal, but several of them said it was the worst decision of their life because it comes with maybe an episode for another day. But I know it's a different world.

when you do that. So I do want to ask you, you just touched about it, approvals and stuff. So one good thing about entrepreneurial brands is they're fast and they move with speed. I describe them like a jet ski and I describe bigger companies like a cruise ship, right? They want to-

It takes a long time, but they can go across the world and have restaurants on none and gyms and all this great stuff, whereas a jet ski can't. So how do you how do you or maybe you'd have a good answer to this because I know it's hard, but how do you maintain that speed and innovation as a big company that you have as an entrepreneurial smaller company, which I think helps you become successful in the early days?

Yeah, you know, right. You're never going to be able to be as entrepreneurial. And I don't, the best of CEOs say, oh, I want to maintain that entrepreneurial spirit within the four walls of this company. And you can to a certain extent, right? You know, you can hire folks that have that spirit. But yeah, you know, it's like trying to turn the Titanic away from the iceberg. You know, sometimes it works and sometimes it doesn't. It takes a minute to, you know, get things turned.

But that's the key, spotting that iceberg from really far away and starting to turn and starting to switch the engine. So I think the key to being able to be entrepreneurial and to getting things done the way you want to get them done is to have long, long-term strategizing and planning.

Again, like I say, stay in touch with your board so they're very prepared to make decisions as you plop it on their laps. So they're not surprised and they don't, when you ask them to approve something, come back with 20 questions and 20 diligence requests and 20 information requests and that slows you down for the next four weeks. Prep them way ahead of time so they're prepared to make that decision and then you can act on it.

have your strat plan laid out way ahead of time. That's not always, you know, that doesn't always happen in a startup because things are moving day to day. But at a big company like that, if everyone sort of sees what you're planning for this year and they understand the tactical plan that went under it and they understand what their part is, then they're all sort of growing in the same direction the whole time. And it won't take, you might not even have to turn away from anything because you've been planning it this way the whole time. Yeah.

You know, so again, it just comes back to communications and long-term planning. It's a necessary evil that comes with getting bigger. And we all want our companies to grow and get bigger, right? We don't want to stay on a jet ski forever. We want to...

Yeah, exactly. So last couple of just quick couple of rapid fire questions for you to wrap up. Different ones that I know people always ask me. So as a CEO of a big company, how often do you go into a store and audit it or look at its product? How removed are you from that?

Weekly. I was constantly visiting stores. I was always on these little puddle jumpers to different places in the middle of the country. And yeah, just, I would pop in sometimes with no warning. Sometimes I wouldn't even, they wouldn't even recognize me necessarily, you know, as I was walking around. Or sometimes I would say, yes, I'm taking a big, you know, I'm going to look at 15 stores in the middle of the country and I'd let everyone know I was coming so that they knew that we were going to have meetings behind the scenes. But we, I was, I was hardly ever in my office.

when I was running retail. I love that. Next question in line with that. How hard is it to maintain brand standards and SOPs as you get so big? It's harder than it should be, you know? But I think the more disciplined you get, you know, with your, in particular, your marketing department, you know, yeah,

the more you really reinforce the messages, then they'll start to do the work for you. They'll really start to care about it, you know, but it is, it is very difficult. And that's why you need to have boots on the ground everywhere all the time. You know, that's why you've got to have a really good visual merchandiser at the top of that department.

just to make sure that, you know, just even the windows are constantly going to be consistent and the floor planning is going to be consistent and where we're going to do sail racks is going to be. All those little details are really important. When you walk into an American Apparel here, it should be the same as when you walk into an American Apparel in Dubai.

And I so admire that of big brands because like I'm so big on SOPs and like reputable systems. And I love how, you know, the good brands pull that off, right? Like you feel the same even halfway across the world.

Exactly. It's like if you're a Soho House member, you know, you're going to walk in to a Soho House anywhere. There might be some local flair, but the same general cocktails, the same general, you know, sort of food, the same vibe, right? And they've done that perfectly. Yeah, I love that. Last question. If someone wants to learn more about you, learn more from you and follow you, where can they do that? Yeah.

Yeah. So, I mean, you know, basic first, I'm on Instagram, Chelsea Grayson. I'm Chelsea Grayson everywhere. You can always find me there, but LinkedIn is probably the best place. You can message me there, follow me, and I'm generally really good at being responsive. And on LinkedIn, you'll see that there's a link to my intro. And so you can also book sessions with me over intro.

Thanks. Love it. Chelsea, been a pleasure. I love diving into some of those lessons and really looking at the differences, but also the parallels as you're growing. It's so great for entrepreneurs to see the future. So thanks for joining us and excited to share this episode. Guys, until next time, keep living the red life. I'll see you soon. Bye.