Michael Kors: Michael Kors

As a teenager, Michael Kors filled his notebooks with dress designs and doodles of his own initials—casual sketches that would eventually fuel the launch of a global fashion brand. Michael grew up with a love of fashion; by the time he was 19, his designs were on display on 5th Avenue, and by 22, his collection was getting attention from the fashion editor of New York Magazine, a young upstart named Anna Wintour. In the early days, he designed thousand-dollar dresses in his bedroom and delivered them in his aunt’s car. As the business grew, he launched a new line with an unproven partner that would eventually lead him to bankruptcy; then, after he recovered, he successfully branched out into eyewear, fragrances, and handbags, all branded with his now famous “MK” initials. Today, Michael still heads Creative at Michael Kors, and the brand has grown into a massive company that includes Jimmy Choo and Versace. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

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• 0:00Guy Raz?

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• 4:23Guy Raz?

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• 5:13Speaker 01

  I was writing payroll checks for my personal checking account. I went around to fabric resources and begged them, "Please, will you give me credit?" I had no office. The first time, I got a phone call and The New York Times said, "Oh, we have a reporter who would love to come and look at the clothes." And I said, "Well, they can't come here." And they were like, "Well, what do you mean?" And I said, "Well, I'm literally sewing in my bedroom."

• 5:48Guy Raz?

  Welcome to How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built.

• 5:59Guy Raz?

  I'm Guy Raz. And on the show today, how a kid from Long Island turned his name into a global brand with designer luxury apparel and accessories under the label Michael Kors.

• 6:19Guy Raz?

  If building a fashion brand is hard, turning that brand into a global one is really hard, especially because names like Nike, Adidas, Louis Vuitton, and Gucci take up so much market share. If you look at the 50 biggest global fashion brands, only a handful are the names of actual, living humans. You can probably guess some of them: Ralph Lauren, Tommy Hilfiger, Calvin Klein. And if you go to Bangladesh, or Dakar, or Chicago, you will likely find some kid wearing a shirt that says Tommy Hilfiger or Calvin Klein. And you may wonder, why? Why is a black t-shirt with the words Calvin Klein

• 7:04Guy Raz?

  such a desirable article of clothing? Well, the answer, of course, is branding. Calvin Klein, Tommy Hilfiger, and Ralph Lauren figured out how to turn their brands into aspirational products. And they didn't become global brands by accident. It happened methodically, carefully, and strategically. And the same goes for the brand and designer behind today's episode, Michael Kors. Michael Kors as a brand has been around a long time, since the early 1980s. But it's only in the past 15 or so years that Michael Kors has become one of the 50 biggest global fashion brands on Earth. Think about how many times you've seen someone wearing Michael Kors sunglasses, or a Michael Kors t-shirt,

• 7:49Guy Raz?

  or clutching a Michael Kors purse. Michael saw what Calvin Klein, Ralph Lauren, and Tommy Hilfiger were able to do on a global scale, and he decided that he wanted to figure out how to do the same thing. Today, the brand is part of a multi-billion-dollar company that Michael Kors himself is still very much a part of. The parent company, which Michael also founded, owns Jimmy Choo and Versace. His brand makes everything from high fashion gowns that cost $10,000 to T-shirts and underwear packs for less than 50 bucks. The company is publicly traded with a current market cap of over $6 billion. But the path to getting there was both fraught and fortunate.

• 8:34Guy Raz?

  At one point in the 1990s, Michael Kors filed for bankruptcy. That forced him to rethink the way he did things, and it also gave him the opportunity to do work for other brands, notably the French luxury fashion line Celine. And it was at Celine where Michael Kors realized that the way to build a really big fashion brand was through accessories, things like handbags and watches and sunglasses. He also very wisely became a judge on the reality show Project Runway back in the early 2000s, which raised not only his profile, but the brand's as well. Michael Kors was not actually born Michael Kors.

• 9:16Guy Raz?

  For the first five years of his life, he was Carl Anderson. But when he was still a little boy, growing up on Long Island in New York, his parents split up, and his mom remarried a man whose last name was Kors. So Carl Anderson took on a new last name, and then a brand-new first name as well.

• 9:37Speaker 01

  So I was going to be Kors. And I think that at the time, there was sort of this, OK, well, we want to use the initial M to commemorate my great-grandfather. And my mom said, you know, what are you, what name do you like? And I said, Michael, I want to be Michael. So I changed my, I changed my trajectory.

• 9:59Guy Raz?

  I know that your mother was a model, and so she would do like catalogs and things like that?

• 10:07Speaker 01

  Well, it's funny. My mother started modeling when she was seventeen. She did some advertising. She was sort of a runway model in local fashion shows. And I think because she was tall, she said she was always the bride in a fashion show. So she wore a lot of bridal gowns. And then she was sort of modeling in showrooms. So she was on Seventh Avenue in the fashion district. And then by the time I was four or five, Revlon, the cosmetic company, they opened a place here in New York that was called The House of Revlon. And I think it was meant to be their salon.

• 10:51Speaker 01

  And they needed the in-house hair models. And I think she wanted a more steady kind of gig, so to speak.

• 10:59Guy Raz?

  Yeah.

• 11:00Speaker 01

  So she became the in-house House of Revlon hair model for a while, where you became the sort of guinea pig for whatever they wanted to do to your hair.

• 11:09Guy Raz?

  Wow. And did you grow up, would you describe your upbringing as middle class? I mean, your mom was a model, but she wasn't like a, it was a different era. This was before supermodels and, you know.

• 11:20Speaker 01

  Oh, no, no. She was pounding the pavement. She was definitely not Linda Evangelista or Bella Hadid.

• 11:27Guy Raz?

  She was getting out of bed for less than $10,000 a day.

• 11:30Speaker 01

  She definitely was. I grew up at that point, what I would say would be comfortably middle class, middle class with some perks.

• 11:41Guy Raz?

  And you, as a little boy, were also a model. Like, you learned advertisements for Lucky Charms, I read, for example.

• 11:51Speaker 01

  Yep. I think when I was around four, I went to a birthday party for a friend in the neighborhood. And so a bunch of kids were all at a birthday party, and the adults are there supervising. As it turned out, the boy whose party it was, his uncle was there and his uncle produced television commercials. And he started talking to my mother and said, you know, I think he'd be great on camera. So she asked me if I was into the idea. And I said, sure. And the first thing I did was, in fact, a Lucky Charms commercial.

• 12:32Speaker 01

  I did, I did a lot of things that in fact got tested in different markets. You know, Snapple, for instance, of course, now we think of Snapple as iced tea.

• 12:41Guy Raz?

  Yeah.

• 12:42Speaker 01

  I did Snapple apple chips, which that did not happen. We all think of Charmin as tissue paper. I did Charmin paper towels, which again, never happened. So, and I did it for about two years. I loved doing it.

• 12:59Guy Raz?

  Yeah. And as a kid, there's a photo of you as a kid and you were a really handsome boy. And still are handsome men, but as I was looking at you as a boy and you look like, I'm trying to think of you look like, you look like Christopher Atkins from The Blue Lagoon. You know, that movie with Brooke Shields, right? Like you have this curly blonde mop of hair as a kid. And, and you looked like that through your teens. And your teenage years were the seventies. I mean, that was when you really kind of came into your own. And I, and I wonder, as a kid already, were you interested in fashion already as like 10, 11, 12 year old?

• 13:36Speaker 01

  I think that I was bitten by the bug even earlier than that. I grew up around people who loved clothes. They loved clothing and they loved the whole idea of getting dressed and looking great. My grandmother, although she was an assistant principal, she got dressed for work every day like she was going on a fashion shoot.

• 14:00Guy Raz?

  Wow.

• 14:01Speaker 01

  My grandfather loved clothes. My aunts all loved clothes. So that was part of the conversation. Plus, I actually loved, growing up, I loved to draw. So I was constantly in my room, drawing and reading. And I, when I was really, when I was growing up, it wasn't just fashion. I would sit and doodle houses, cars, all of that. But fashion was definitely, by the time I was, you know, 10 or 11, Vogue would arrive and it was just a monumental moment. So it was definitely something that was always there.

• 14:36Guy Raz?

  Michael, when you were, you know, a teenager, right? And in sort of the world you inhabited, were you, I mean, would you, would you have considered yourself a socially active kid? Like, did you have lots of friends? Or did you get teased? I mean, you were into fashion and, and obviously you're a gay man today, but, but back in the 70s, it was a different world. What do you, what do you remember about just being you at that time?

• 15:03Speaker 01

  I, the funny thing is, although I, here I was, sitting and sketching women's fashions, totally obsessed also with theater and music. So, you know, I'm definitely not on the Little League team. I was obsessed with how I was dressed. You know, I would have spent my last dime on getting something that was probably more outlandish than anyone else was wearing. There were comments for sure, but at the same time, I don't know, I think my family imbued me with this sense of confidence that, you know what?

• 15:46Speaker 01

  You're not the same as everyone else and that's actually going to be a plus. And so I'm very lucky that I had that situation. You know, a lot of kids don't feel that in their home. I think for a lot of kids, you know, if they made a proclamation that they wanted to be a fashion designer, their family might say, well, what is that? What does, what does that mean? I didn't, I didn't have that situation.

• 16:11Guy Raz?

  Well, I'm curious, because, I mean, obviously your mom was a model, so she had done runway things in Long Island and locally. Did you have access to great clothing on Long Island or would you go to the city? I mean, obviously, New York wasn't New York today, but even in the 70s, it was still a fashion capital in the world.

• 16:32Speaker 01

  Well, I mean, for me, from the very, very, very young age.

• 16:39Speaker 01

  I grew up, you know, loving movies and The Wizard of Oz was, you know, when I was growing up, that was just the ultimate magic. And I really did think of Manhattan and New York City as Oz. And so there was never any question that I would be a New Yorker.

• 16:58Guy Raz?

  Yeah.

• 16:58Speaker 01

  So, you know, my heart would pound. By the time I was a teenager, you know, I'd be saving up to go to Bergdorf Goodman or to go to Saks Fifth Avenue and buy something. And, you know, and it would just be the greatest thing in the world for me to, you know, have that special piece. And I always wanted something that other people didn't have. I never really wanted to be just like everyone else.

• 17:21Guy Raz?

  Yeah. There's, there's a famous photograph of Bianca Jagger on a horse. And anyone who knows anything about Studio 54 in the seventies knows that photo because it's so iconic. Like, she celebrated her birthday on a white horse in Studio 54. And it just tells you everything you need to know about New York in the late seventies. You were there. You were actually at Studio 54 that night as a high school student, like just out dancing, right?

• 17:47Speaker 01

  You know, once again, I go back to the idea that I really never wanted to be like everyone else. Instead of going to my senior high school prom, that was in fact, the night that I first went to Studio 54 with a friend. We went into Manhattan. We went out to dinner. I didn't even actually think at the time that it was so special that we were able to get in, or why did we get in?

• 18:14Guy Raz?

  Yeah.

• 18:15Speaker 01

  You know, we were 17 years old. Who knew who we were? But we had, we had youth, I guess, and energy on our side. And, and maybe I had Christopher Atkins hair from Blue Lagoon, who knew? And I somehow knew instinctively that this was a remarkable moment in time. You know, the, the magic of being in a room and seeing all the fashion people that you look up to and worship, you know, Halston and, and Eliza Minnelli and all of these people. And then Bianca Jagger comes in on a horse and you say to yourself, well, this is the place I want to be. It was that moment that, you know, that can't

• 18:57Speaker 01

  happen that often. If it happened all the time, it wouldn't be as special.

• 19:01Guy Raz?

  Yeah.

• 19:04Guy Raz?

  So you knew already you wanted to go to fashion school and to become a fashion designer. And you did, you went to the Fashion Institute of Technology in New York. But you were only there for, I shouldn't say only, but you were there for about nine months before you dropped out. Tell me about.

• 19:17Speaker 01

  Yeah.

• 19:18Guy Raz?

  Why? I mean, did you get there and say, you know, I don't, I think I just want to start working? Like, what, what happened?

• 19:25Speaker 01

  Well, I think that I, I thought that I would do the expected trajectory. I'd go to school, I'd get a job when I graduated, hopefully working for a designer who I admired. I'd learn the sort of inner workings of how it all worked. I'd pick up pins, I'd fetch coffee. And while I was in school, I was working at a boutique on Fifth Avenue and 57th Street called Lothar's. And I got a part-time job there selling the clothes that they carried at the time, which were sort of, I don't know, you maybe call it the gap for the uber-rich.

• 20:08Speaker 01

  It was jeans, T-shirts and down jackets, all made in France, a lot of it tie-dyed. And we had remarkable celebrity clients from around the world. So, you know, we had Cher and Diana Ross and Goldie Hawn, Rudolf Nureyev, Jackie Kennedy. I mean, it was amazing. And I was 18 years old.

• 20:29Guy Raz?

  Wow, you were dressing these people or you were.

• 20:31Speaker 01

  Yeah, I was knocked out by the whole thing. I mean, so school suddenly, you know, between that and Studio 54, school was sort of like, why isn't school moving quick enough? I thought I was learning more when I went to work. And I decided that, you know what, maybe I'm going to skip the few steps. And I left school and I started working full-time.

• 20:54Guy Raz?

  At Lothar's.

• 20:56Speaker 01

  At Lothar's. And also for myself, I always, my favorite activity is to watch people on the street. And the streets of New York in the late 70s and the 80s, it was like a fashion show. Watching people and how they got dressed and how they, how they expressed themselves with fashion.

• 21:15Guy Raz?

  So you're working at Lothars and obviously learning about a retail store and how to sell and how to help customers, but also on the side and at home, just sketching your own designs, which you'd been doing since you were a teenager. What kind of things were you sketching? Like, what types of apparel were you drawing?

• 21:38Speaker 01

  I think if I describe it now, everyone will say, well, I guess it's pretty similar. Everything was sort of timeless, but not classic, luxurious, but not ostentatious. So a lot of it was, it was all about versatility. I always thought about comfort. I think I, I think I learned about that also, being in a retail store and watching people trying things on. So that idea of sort of sporty glamour, that's definitely, you know, been my focus since I designed at Lothars and since I started designing on my own.

• 22:19Guy Raz?

  When you, when you thought of, you know, you're working at Lothars, but in your mind, did you think this is really just this kind of holding pattern before I make my own mark? Or were you intimidated by the idea of trying to become a fashion designer? I mean, you know, you knew the names of the famous people. You knew who they were. Did you think I could do that too? Or were you, did you have some self doubt?

• 22:46Speaker 01

  You know, I don't want to sound that I was overly confident, but even though I didn't finish school, even though I didn't really know the mechanics of really how the fashion industry truly worked, I knew that I wanted to do my own thing, have my own business, my own collection. And I had a very defined point of view. Funny enough, at the time, I was still at Lothars and I had started designing the clothes that were in the store. I was also doing the visual merchandising, so I was doing the windows. The staff reported to me, the selling reporting came in to me.

• 23:30Speaker 01

  So, you know, this was a lot for someone who was 20 years old. But I still for a minute thought, maybe I should go to work for someone else. You know, I'll learn something if I go to work for someone else. And we had a lot of fashion insiders shop in the store. And there was a woman at the time who was a designer who I admired. Who she shopped in the store, her name was Adri. And Adri, I said to her, I said, you know, I think that there is a possibility that I could go to work for Halston. And, and I love what he does. And I said, you know, maybe that would be great experience. And she said to me, no, you know what you want to do. I can see it in the clothes here at Lothar's.

• 24:15Speaker 01

  And she said, just wait for the moment and the opportunity will come. And you, at that point, should do your own thing.

• 24:23Guy Raz?

  Right, right. So you were, I mean, you're 20, 21 years old, working at Lothar's and also designing pieces that they sold, like what jeans?

• 24:34Speaker 01

  No.

• 24:35Guy Raz?

  Shorts, button downs?

• 24:36Speaker 01

  No, what happened at Lothar's was funny. As I said before, if it was really initially the sort of European, French gap, kind of for basics for the very rich. It was a very, very specific look. And as the seventies ended and tie dye and hippie and all of that disappeared. We, suddenly, we were left with the wrong product. And so I started designing really a full range of different clothes for the store, which included, you know, women's jackets that were more tailored, a more polished look. The eighties were starting to happen, where people were going to be a little bit more dressed up.

• 25:21Speaker 01

  And I was just going by my, my gut, my, my instinct.

• 25:26Guy Raz?

  And all that, I mean, because a store like, like that today would mostly sell brands, right? From other designers.

• 25:34Speaker 01

  Oh, yeah.

• 25:34Guy Raz?

  And maybe they might have their own line, but it's super inefficient, right? A small boutique designing its own line and then just making a few. Pieces of, you know, like maybe 20 or 30 pieces.

• 25:47Speaker 01

  Oh, no, we didn't even make 20 or 30.

• 25:49Guy Raz?

  We'd make 10.

• 25:50Speaker 01

  Oh, sometimes I would make two.

• 25:52Guy Raz?

  Wow. But was that common for a store, a small boutique, to have its own line of clothing?

• 25:58Speaker 01

  In-house designer? No, not at all. I mean, you know, was I in the right place at the right time? The people who owned the store, they knew that I, you know, understood the customers and I was a designer. So the next thing I knew, I was set up with a little workshop in Manhattan. So I first, you know, for the first time in my life, I had people who were making the patterns, following my sketches and actually making the clothes. So I started buying fabric and buttons and zippers. And I mean, it was literally, I kind of learned about being reactive.

• 26:38Speaker 01

  So I don't know, if my windows had colorful dresses and it was, you know, April, and I had colorful dresses in the window and suddenly it started raining cats and dogs every day and it was pouring rain. I said, okay, well, you know what? People are going to need raincoats. So I would literally run and buy some material and figure out what kind of cool raincoats was I going to make? And I would put those in the window. If they were successful, we'd make more. So it was sort of a laboratory, which was, you know, incredible way to learn.

• 27:17Guy Raz?

  Incredible. And also just, I mean, again, like the, you know, in order for that store to survive, they would have had, would have had to have sold those pieces for just a fortune.

• 27:28Speaker 01

  It was expensive. I will, I will definitely acknowledge that what we were making was for a very rarefied clientele. But I think people also absolutely loved the fact that they knew they were not going to see, you know, if they bought that raincoat that I put in the window, they weren't going to see, you know, everyone on the street wearing it.

• 27:49Guy Raz?

  I guess that there, I mean, you're in the store. Obviously, celebrities are going there. Your designs are in the window. Like, some of the clothes they're selling are designed by this kid, Michael Kors. And probably some people asked, and more and more people started to find out about this. And I guess there was one person named Don Mello, who had a big job at Bergdorf Goodman, who noticed your designs. And what, is that what happened? She noticed your designs and said, hey, let's talk?

• 28:17Speaker 01

  Well, I was actually doing the windows. I was physically in the window on 57th Street and 5th Avenue. I think I had pins in my mouth and I was dressing a mannequin. And this very, very stylish woman walked into the store and she started talking to me and she said, these clothes that are in the window, they don't look the same as the tie-dyed French Lothars clothes that, you know, we had seen in the past. She said, who designs these clothes? And I looked at her and I said, I do.

• 28:56Guy Raz?

  Wow.

• 28:56Speaker 01

  And she said, but you're doing the windows. And I said, well, I do the windows and, you know, I design the clothes and I'm on the selling floor. And she, she introduced herself and she said, my name is Don Mello. And at the time, I think she was the fashion director at Bergdorf Goodman, which was directly across the street from us. And she said, if you, if you ever have a collection on, on your own, give me a call. I'd love to see it.

• 29:27Guy Raz?

  Wow.

• 29:28Speaker 01

  And I, I literally went home that night and I started sketching my first collection. It was the impetus, even though I had no plan, I didn't really know how I was going to do this, where I was going to make it. I didn't think about any of that. I just said, OK. There is someone with interest.

• 29:49Guy Raz?

  Yeah.

• 29:49Speaker 01

  And the women who worked for me at Lothar's, the seamstresses and the pattern makers, I had them make this very small collection. And once it was put together, I was still working at Lothar's and I didn't know if this would really work out.

• 30:08Guy Raz?

  Yeah. By the way, were you worried that the Lothar's people would be like, hey, you're our guy. What are you doing?

• 30:14Speaker 01

  Oh, yeah, absolutely. I was, this was all very clandestine. But again, I didn't really know, you know, is this going to actually happen? So I didn't want to leave my job. So I kind of very quickly.

• 30:29Guy Raz?

  Quietly, we're doing this, yeah.

• 30:31Speaker 01

  Quietly went across the street on 57th Street to Bergdorf Goodman.

• 30:35Guy Raz?

  Nervous?

• 30:36Speaker 01

  Yes, nervous. I had no idea about any of the logistics. How was I going to produce any of this? How do you cost it? How do you figure out your profit margin, your markups? Even like my style numbers, I had no idea. So I thought, style number one, style number two, style number three. You know, I had no.

• 30:59Guy Raz?

  And they were dresses, they were suits for women?

• 31:02Speaker 01

  No, it was.

• 31:02Guy Raz?

  Just in making women's fashion, right?

• 31:04Speaker 01

  It was only women's fashion. No accessories, no shoes, no, no bags. It was a small collection of luxury women's separates. You know, what we, what we in the fashion industry say sportswear, a lot of people think that means jogging clothes. But it's really boils down to sort of this American invention of clothes that are versatile, you know, separate pieces that you can wear different ways. And that's what I brought to Bergdorf Goodman back then in 1981.

• 31:37Guy Raz?

  Okay, so you bring it to, this is 81. You don't have a business yet. You're not Michael Kors yet.

• 31:42Speaker 01

  I'm nothing.

• 31:43Guy Raz?

  I mean, you are, yeah. And what, what was the response? Did you show it to Don Mello or did you show it to somebody else at Bergdorf?

• 31:52Speaker 01

  Well, I walked in and there was Don Mello waiting for me. And she was with a group of women who were the sort of buying team and the decision makers at the store. I brought a friend with me who would model the clothes because I was a firm believer that everything had to be seen on. So I started the process and started showing it to them. And I think I was literally at the third piece.

• 32:25Guy Raz?

  Do you remember what the piece was? Was it trousers? Was it a dress? Was it?

• 32:29Speaker 01

  I did a lot of leather and suede back then. And I think I had this long, black suede. At the time, we said gaucho pant that had an overskirt and this big, wide obi-belt. Very dramatic, very expensive for 1981. And everyone in the rooms looked at me and said, could you excuse us? And could you leave the room for a minute? I thought, OK, this is over. So I left the room. And about two minutes later, Don Mello said, we really think the clothes are terrific. And we think they're perfect for Bergdorf Goodman.

• 33:12Speaker 01

  And we, we want to be the only store in New York to carry the collection for at least a year. And we'd like you to come back to us and tell us, you know, is there anything you need from us? And I, of course, I mean, I had no idea how I was going to do any of this. I didn't know what to say, what to do.

• 33:39Guy Raz?

  Yeah.

• 33:39Speaker 01

  So I called a family friend, was a designer named John Anthony. And I called him and he said, well, make your wish list. And I said, what does that mean? And he said, well, he said, what do you need to succeed with this? So I said, well, I'd love to have windows on Fifth Avenue. And he said, well, that should go on your list. I said, oh, I'd love an ad in the New York Times. And he said, what else? And I said, well, I think I want to do a personal appearance or a trunk show so I can meet the clients. He said, add that to the list. And then I said, well, I have no money. I said, I don't know how I'm going to actually produce.

• 34:23Guy Raz?

  Yeah.

• 34:23Speaker 01

  How am I financing this? How am I producing it? And he said, you should talk to them and see if there's any way that, you know, they could help you and prepay for some of their order. And I said, OK. And the following day, I called Dawn Mello at Bergdorf Goodman. And I said, here's what I, you know, need. And she listened very carefully. And she said, we're good with all of that. If you, you know, stick with us, we'll stick with you.

• 34:54Guy Raz?

  Wow.

• 34:54Speaker 01

  And the next thing I knew, I had people sewing in my apartment on 7th Avenue and 23rd Street.

• 35:04Guy Raz?

  How many pieces, by the way, how many pieces of each garment did you have to make?

• 35:08Speaker 01

  I probably produced anywhere from, I would say, a dozen to three dozen at the max, but, you know,

• 35:18Guy Raz?

  Right.

• 35:18Speaker 01

  two dozen of most things. I had people sewing in my apartment. I was, you know, dragging bolts of fabric in taxis and up the elevator. And we were cutting the clothes, all of the fabric and all. We were cutting everything. My apartment was so small, we used a friend's apartment upstairs to cut things out. And somehow, then I think, I didn't even really understand how people delivered clothes to a store. I didn't know that, you know, there was UPS. You know, I wanted to hand deliver all of the clothes. I was afraid they'd wrinkle and crease. So I delivered them in the backseat of my aunt's car.

• 36:02Guy Raz?

  When we come back in just a moment, how Michael moves out of his apartment and into stores across the country. But about 10 years into the business, gets into a bad partnership that leads to bankruptcy. Stay with us. I'm Guy Raz, and you're listening to How I Built This.

• 36:35Guy Raz?

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• 40:10Guy Raz?

  Hey, welcome back to How I Built This. So, it's 1981, and Michael has just gotten a commitment from Bergdorf Goodman to carry his first collection of clothing. And at the time, he's still making that entire collection in his apartment.

• 40:25Speaker 01

  Yep, every piece. And then I packed it all myself. I delivered it all myself. The windows, I knew which day they were going to go in, and I was standing on Fifth Avenue at 2 o'clock in the morning, driving everyone crazy. And I think they made a huge exception at the time, and they let me come in and go into the windows and sort of fidget and fuss with the mannequins. And then the New York Times advertisement came out. I had no office. The first time I got a phone call... And the New York Times said, oh, we have a reporter who would love to come and look at the clothes. And I said, well, they can't come here. And they were like, well,

• 41:10Speaker 01

  what do you mean? And I said, well, I'm literally sewing in my bedroom. But in fact, the New York Times did come and they sat in my bedroom and looked at the collection. And then the first article that was written about me, I was the fall fashion pick in New York Magazine. And at the time, the editor was Anna Wintour. And she called me and it was the same situation. Anna said, I want to see the clothes. I've heard wonderful things. And she said, where is your office? And I said, I don't have one. And I took

• 41:49Speaker 01

  the subway to the New York Magazine offices. And I hung the collection on her coat stand. And, you know, and so there was, it was definitely an unorthodox way to start. I mean, I was, I was writing payroll checks from my personal checking account.

• 42:05Guy Raz?

  To your, to the seamstresses and stuff?

• 42:07Speaker 01

  Yes. I mean, it was, it was really crazy. I went around to fabric resources and begged them, please, will you give me credit? You've known me, you know, since I'm 18 years old. You know, it was definitely not a traditional way to approach setting up a business.

• 42:23Guy Raz?

  Yeah. I mean, did you know how to do basic accounting, for example?

• 42:25Speaker 01

  Not really. I mean, yeah, I mean, not really. I mean, I figured out how to figure out my profit margin and how I should price things. And so I did do that. But

• 42:38Guy Raz?

  Right.

• 42:39Speaker 01

  It became very apparent, very quickly, that there was no way I was going to do this on my own.

• 42:44Guy Raz?

  Yeah. I mean, here you were, and I'm assuming you thought of yourself as an up and coming designer. You were a young designer. This was, you were a creative. And, but at the same time, the Bergdorf order was financing the founding of what would become your business. And you probably didn't think of it that way. You probably didn't think, okay, I'm starting a business. I'm founding a business. But you were, you had to do Some of the things that you have to do to start a business. And I guess there was a guy named Jack Orcooley. Am I pronouncing that correct?

• 43:14Speaker 01

  Orchulie.

• 43:15Guy Raz?

  Orchulie that you you brought in to help you kind of build this business. Who who is Jack?

• 43:21Speaker 01

  Well, yeah.

• 43:22Guy Raz?

  Yeah.

• 43:23Speaker 01

  So I started down the traditional route. I talked to a lot of different people who were already on Seventh Avenue producing clothes. And what I immediately saw with them was that they had a lot of rules about how they thought things should be done. And I said, you know what? I think I'm going to go about this a different way and look for someone to be a partner in business who isn't necessarily in the fashion business. And I met someone who worked at Bergdorf Goodman at the time. And she said, my husband is in the real estate business. He is not in the fashion business, but he is definitely intrigued by it.

• 44:06Speaker 01

  And we met and in we jumped. And I was, was I 22? I was 22.

• 44:15Guy Raz?

  And how old is Jack?

• 44:16Speaker 01

  Oh, he was probably all of 33. So we were young and curious and energetic. And and we set up, you know, my first office. But my first office was a loft that I lived in initially in the back. But it was a big step up from, you know, showing the New York Times my collection in my bedroom, at least my bedroom now was in the back. And step by step, it was a slow progression. And I think I waited until 1984 to have my first fashion show.

• 44:58Speaker 01

  Because I really, I knew that I had to sort of line my ducks up and make sure that, you know, that I knew that I was. Being able to deliver the goods, so to speak, and all these steps, the collection started getting a little bit bigger and broader. We were no longer strictly dealing with New York City. I was suddenly on the road a lot.

• 45:22Guy Raz?

  Yeah, because after a year, you weren't only committed to Bergdorf. You could sell anywhere.

• 45:27Speaker 01

  Oh, suddenly I was in Minneapolis, and I was in Nashville, and I was in New Orleans, and I was in Los Angeles, and I was traveling.

• 45:35Guy Raz?

  At specific stores at the big, like Saks, Saks and Neiman Marcus, Bloomingdale's?

• 45:40Speaker 01

  Saks Fifth Avenue, Neiman Marcus. But also, a lot of my initial business was really built in specialty stores where they really had these remarkable relationships with their clientele. So you were almost, if you went back, let's say, to Dallas twice a year, it was kind of seeing clients who became like friends.

• 46:07Guy Raz?

  Yeah.

• 46:08Speaker 01

  And you started to really learn how these women lived. Where did they go on vacation? What were the restaurants like in their city? Did they work or did they not work? It was a crash course in consumer knowledge.

• 46:23Guy Raz?

  And what made your line appealing, I guess, was that it was elegant but practical, like it was everyday clothing. I mean, obviously, you make gowns and evening wear, but mainly what you were making then was like everyday clothing that was also elegant.

• 46:42Speaker 01

  That is a very sharp and clear assessment. I think women found the clothes to be easy to wear, versatile, long-lasting, glamorous, but accessible.

• 46:59Speaker 01

  That was, and then also, we, we, we seem to have started even back then in the eighties, with this very, very wide, broad range of different kinds of customers, different ages, different sizes. I would go to do a personal appearance and we could have three generations in one family. We'd have the granddaughter, we'd have the daughter and we'd have the grandmother.

• 47:26Guy Raz?

  All wearing it.

• 47:28Speaker 01

  They'd all wear it and they'd all find their own way to wear it.

• 47:30Guy Raz?

  Yeah. So, and I think that's the key, right? That cross generational brand. Like, if you can hit that, if you can get those three generations wearing your line, like, that's kind of like the holy grail, I guess, of fashion.

• 47:42Speaker 01

  Definitely. It's, it's also, years later, of course, when I was doing television, I was doing Project Runway. I would sometimes listen to some of the designers on Project Runway and they'd say, well, you know, I don't really design for people that size, or I don't design for women that old. I was always perplexed listening to them, thinking, well, wait a minute, if you're good at what you do, you're a problem solver. You're solving the puzzle. So you should be able to design in such a way that you get your message across,

• 48:21Speaker 01

  but at the same time, you have that possibility to be democratic, whether that's just in size or age, or, or even how a woman or a man puts themselves together. You know, because not everyone wears the same thing the same way. They want to be able to put their own spin on it.

• 48:42Guy Raz?

  Yeah. You know, in those first few years, you're selling first to Bergdorf and then you're going around and selling to boutiques around the country, small boutiques, and even your line is even in Saks and Bloomingdale's and other big retailers. Just to get a perspective, did that mean that you guys were just making tons and tons of money or, or not? I mean, because I think the assumption would be, oh, Michael Kors, he's, he's everywhere. But, but actually, the reality's a little bit different, right?

• 49:11Speaker 01

  Very different. You know, it is mom and pop. You know, roll up the sleeves. The hands get dirty. You're doing everything yourself. And yes, each point, as the business grows, you can take on a new employee. Suddenly, you have a public relations person. Suddenly, when stores or magazines or the press come to visit your office, you can offer them something to eat, a cup of coffee. But you're definitely not rolling in the dough. You need things to build. You need to learn. You need to see things kind of grow at a rate that it's right. It's the right thing at the right time.

• 49:56Guy Raz?

  Right. You mentioned that this was very much a small business and it was still about traveling around the country to boutiques. And meanwhile, your partner, Jack, is kind of, I guess, manning the shop and running the books and stuff. And you are the face of this brand. But I imagine to really start to scale it, there are things you have to do in the fashion business. And one of the things, inevitably, and you did this in 1990, was to launch a lower-priced line. And it was called Kors, by Michael Kors. And you started to work with a licensee, I guess, an Italian company. First of all, before we get into what happened, is that true? I mean, in order to really grow the business,

• 50:42Guy Raz?

  you kind of have to create a lower-priced line? Maybe have to is not the right word, but you-

• 50:46Speaker 01

  I don't know if it's-

• 50:46Guy Raz?

  Inevitably?

• 50:47Speaker 01

  I don't know if it's necessarily that you have to create a lower-priced line, but you have to have something to sell that can have a broader appeal. Now, that doesn't take anything away from someone who is very comfortable and very happy.

• 51:06Speaker 01

  Keeping their business small, tight. You know, we were, we were saying before, you know, I might not have played Little League as a kid, but I am definitely a competitive player.

• 51:17Guy Raz?

  Yeah.

• 51:17Speaker 01

  And so I think if you want to scale to the next level, doesn't mean that you have to have a lower price line, but you have to have something that can have a broader audience. But for me at the time, back in 1990, I think I was at Saks Fifth Avenue at the time in New York, and it was the day that the store went on sale, so to speak. And I happened to be there and watch this. And I saw women who were kind of at the sale racks, loving my designs. And I realized that this was a whole different audience of people who I was not speaking to.

• 51:58Guy Raz?

  Because a garment might cost, at that time, two, $250, and they, and it was on sale for 100.

• 52:05Speaker 01

  Exactly, exactly.

• 52:07Guy Raz?

  And presumably, I mean, you, you kind of alluded to this, some designers are, have an aversion to this because they're, inevitably, there are compromises that come with that. You've got to manufacture it more efficiently. It's got to be cheaper to make. You cannot sell.

• 52:19Speaker 01

  Absolutely, absolutely.

• 52:20Guy Raz?

  Right, you can't sell something, it's got to be more like 75 to 100 dollars rather than four to, 400 to 5,000 dollars, right? And so.

• 52:28Speaker 01

  Exactly.

• 52:29Guy Raz?

  Inevitably, right, it means that there are different approaches to it. Did you have any fears about that? Did you have, because imagine, you know, every designer has to think like, you know, if my stuff is going to be at TJ Maxx eventually, is it going to devalue the, the brand in the, in the minds of consumers?

• 52:48Speaker 01

  I think that we, what, what, what, how I approach it is this, everyone has a different budget. So what's inexpensive to one person is expensive to another. You know, so I think what, what, how I approach it is, is it the best designed, best quality thing at that price?

• 53:11Guy Raz?

  Yeah.

• 53:12Speaker 01

  That's, that's to me, the trick. And then I feel that whoever is buying it, they're getting the best thing that they could buy and, and that works for their life. So whether it's.

• 53:24Speaker 01

  $79, $790, or $7,900. Is there integrity to the way it's designed? Is it the best quality you could find at that price? And then it's the right piece. It's just the right thing at the right price.

• 53:43Guy Raz?

  All right. So you struck a deal with a licensee in Italy, a company to make this Kors line. And that ultimately proved to be, I guess, I don't know, it didn't work out, right?

• 54:02Speaker 01

  That's a nice way to put it.

• 54:04Guy Raz?

  Disastrous? What happened?

• 54:07Speaker 01

  Well, no, at first it was tremendously successful. So here's the first time in my career that we launched something and it just shot out of the cannon very, very quickly. And it was an immediate success story.

• 54:26Guy Raz?

  And these are, what were they making? T-shirts that said Michael Kors on them?

• 54:29Speaker 01

  No, we made a full, no, no, no. It was a full collection, again, of women's sportswear.

• 54:36Guy Raz?

  Right.

• 54:37Speaker 01

  Jackets, trousers, shirts, dresses, everything.

• 54:40Guy Raz?

  Right. And this is what's known as, I guess, like a bridge line in the fashion world.

• 54:45Speaker 01

  Back in those days, they would say Bridge, which was a bridge between more affordable and designer prices. It's turned into contemporary, affordable designer, whatever it is. To me, it was just a more accessible product.

• 55:04Guy Raz?

  And presumably, this Kors line is probably really fueling your business, right? This, I guess, very quickly becomes the biggest driver of revenue.

• 55:15Speaker 01

  Absolutely. Unfortunately, what happened, the company that we licensed to, we were really their first great success with licensing a designer name. And I think they were so successful with us that they suddenly said, well, this is easy. We can do this with other people. And they went out and they started gathering other designer names that they said, oh, well, if we did this with Michael Kors, we could do it with you. We'll do it with you. And they overextended themselves.

• 55:57Speaker 01

  And it turned into this sort of perfect storm where we were chugging along with the royalty checks and expanding and, as I said, really building up our infrastructure.

• 56:12Guy Raz?

  Yeah.

• 56:13Speaker 01

  And the next thing you know, you've basically started relying on someone else. And they ran into complications with some of the other lines and collections that they were licensing. And the next thing you know, they went bankrupt.

• 56:29Guy Raz?

  Wow.

• 56:30Speaker 01

  And they ended up owing us considerable amount of royalty money. And we, of course, had been spending all along. We knew the money was coming in, the stream was coming in, and we didn't think the stream would ever stop.

• 56:46Guy Raz?

  Yeah.

• 56:47Speaker 01

  And then the stream stopped.

• 56:48Guy Raz?

  Which is like, yeah, I mean, you were, it sounds like, you know, 60, 70, maybe 80% of your money was coming from this one source, which is always dangerous for any business.

• 56:59Speaker 01

  For any business. And also, let's be honest, spending the money before it comes in. It's the combination of being too dependent on one thing, not diversified enough, and quite honestly, putting all your eggs, so to speak, in one basket. So it, at the time, I think I thought to myself, first off, how could this happen? If I don't have my own business, who am I? We have to figure this out and sort our way through this.

• 57:38Speaker 01

  And I have to say, at first, there was never any question. We weren't going to close, but we were going to have to, you know, cut expenses dramatically.

• 57:48Guy Raz?

  And you had to declare bankruptcy.

• 57:51Speaker 01

  We went into Chapter 11 bankruptcy. But the, right away, we made the decision, we're not going to stop producing our collection. We're going to continue to ship it to the stores and we're going to continue doing business. Maybe we won't be able to have an advertising campaign. Maybe we have to cut staff. Maybe we have to, you know, no longer have an extravagant fashion show. We're going to do what we have to do.

• 58:21Guy Raz?

  When that was happening, you're 32 and you're in bankruptcy. Were you, was a part of you feeling like, I failed? Like, I'm not gonna, I might not recover from this?

• 58:33Speaker 01

  Initially, I thought, even though I understood the circumstances, it's hard not to question yourself and what did I do wrong? What did I, you know, what mistake did I make? But then I saw that, you know, I don't think my confidence flagged ultimately, once I, once I brushed myself off. And that, that definitely, between the fact of, of course, cutting expenses and pushing up the sleeves and, and, and getting dirty and doing everything yourself. A few years later, we were out of Chapter 11 and then we, we got back onto solid ground.

• 59:11Guy Raz?

  When we come back in just a moment, Michael comes out of bankruptcy with a new gig and some new ideas about the beauty and the business value of accessories. Stay with us. You're listening to How I Built This.

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• 1:00:55Guy Raz?

  Hey, welcome back to How I Built This. I'm Guy Raz. So it's 1997 and Michael Kors, the brand, is recovering from bankruptcy. But thanks to a new partnership with a Japanese company called Onward Kashiama, it's able to keep making its line of moderately priced clothing. Meanwhile, Michael, as he's managing all of that, takes on a new gig. You were hired by Celine, the French fashion house, to be their in-house designer. And obviously, a big deal, you're an American designer, this is a French fashion house owned by the multinational LVMH. How did that work?

• 1:01:37Guy Raz?

  I mean, you had Michael Kors as your business, and then you also became an employee of Celine?

• 1:01:44Speaker 01

  Well, fashion sometimes is like, it's really an athletic endeavor. And, you know, you're getting to the next step. Can I lift more weights? What can I handle? And the last thing that had ever crossed my mind would have been that I was going to design a collection in Paris and have a fashion show in Paris. And it was, it was really nothing I ever thought of. But I thought, you know what? I owe it to myself to try this. It's definitely a lot of juggling. Also, I was, for the first time, my eyes opened at Celine to the power of accessories,

• 1:02:28Speaker 01

  handbags and footwear, which was the bulk of their business.

• 1:02:33Guy Raz?

  Yeah.

• 1:02:34Speaker 01

  It taught me really the power of accessories. How democratic something can be if it's well-designed, if it's, you know, the right bag, the right shoe, the right pair of glasses. And that was a whole new sort of category for me.

• 1:02:50Guy Raz?

  I wonder, Michael, and this might be sort of a, you know, just a dumb question from somebody who's not an insider in the fashion industry. How did you know, like, what pieces to design for, for, you know, Celine and for yourself? Like, I'm thinking to myself, you know, wow, I just, you know, I designed something and I'm blown away by it and I want to keep it with my name on it. You know what I mean? Like, I wouldn't want to give that to Celine, but of course, you also work with them. So how do you, how did you kind of figure out what, what goes where?

• 1:03:21Speaker 01

  What goes where is a good question. Well, of course, you know, to a certain degree, you also start competing with yourself.

• 1:03:28Guy Raz?

  Right, yeah.

• 1:03:29Speaker 01

  You are competing with yourself. The thing that, that really helped me, you know, when you start designing, inevitably, you actually have too many ideas. And often you might fall in love with an idea, but you say, you know what? It doesn't really fit. I'm going to have to get rid of it.

• 1:03:50Guy Raz?

  Yeah.

• 1:03:50Speaker 01

  So you edit it out. So suddenly I had more opportunity and more places that I could actually use an idea or use a design. But also, Paris by nature is an indulgent city. It's a more indulgent approach to getting dressed. New York is a much more practical, pragmatic kind of space. So I, I think that Michael Kors tended to be a more quiet approach to luxury. And I think that Celine tended to be a more extravagant approach to luxury.

• 1:04:34Speaker 01

  So that was kind of how we split the two.

• 1:04:38Guy Raz?

  Yeah. They, obviously, LVMH, they deepen their relationship with you. They, they bought a stake in Michael Kors, I think in 1999.

• 1:04:48Speaker 01

  Yes.

• 1:04:48Guy Raz?

  About a third of it. And so that was an infusion of capital into Michael Kors. And by that time, I have to imagine Michael Kors is, you know, it's not what it is today. But even in 1999, were you on a better financial footing at that point when they made that investment?

• 1:05:06Speaker 01

  Absolutely. We, we had an investment from Albert Kosciama. And we had the investment in 99 from LVMH. Definitely put us on much more stable ground to grow the business and to launch Michael Kors accessories in the early, I think it was 2000, actually.

• 1:05:27Guy Raz?

  This was like the perfumes and?

• 1:05:29Speaker 01

  Fragrance came. It was really my first foray into products that were not clothing based. So I launched my first fragrance. We signed a license for shoes, sunglasses. We broadened our product mix for sure.

• 1:05:48Guy Raz?

  How did it change how you operated the Michael Kors business? Because you'd kind of been burned earlier with licensing, not with licensing, but with like how much you spent and becoming super dependent on these licensing revenue streams. When you went back to it, you've got now fragrances and shoes and other things in the early 2000s. Were you guys more careful about how you operated the business?

• 1:06:14Speaker 01

  Well, I think we definitely learned diversity was important. So you weren't relying strictly on one product.

• 1:06:24Guy Raz?

  Yeah.

• 1:06:25Speaker 01

  You had a broader range of products. And you also were watching your spending, not that you were not spending the CapEx that you might need to spend to get to the next level, but you were not overspending because we had been burnt. But I think it was really the diversification that we went from having all of the money from a license initially before Chapter 11, which was from one revenue stream to suddenly having licensing money coming in from shoes, coming in from glasses, coming in from fragrance. We were selling bags. We were doing our own menswear.

• 1:07:09Speaker 01

  So there was more diversification to the business, which is healthier.

• 1:07:12Guy Raz?

  So this kind of leads to the next really big turning point in your business, which is 2003. Two new investors acquired about 85% of Michael Kors, Silas Chao and Lawrence Stroll. And from what I gather, you sought them out. You wanted these investors to come in, buy out the shares owned by LVMH and the Japanese company and even your business partner. And I imagine you did this because you thought that with their ownership and their partnership, you could scale the business even more. Was that the thinking?

• 1:07:51Speaker 01

  Absolutely. And I felt that I was, at the time, we were doing well, but we were treading water. And I really wanted to see the business go to the next level.

• 1:08:04Guy Raz?

  Yeah.

• 1:08:04Speaker 01

  Silas Chow and Lauren Stroll became involved with Tommy Hilfiger's business. And they really took Tommy Hilfiger to a very, very, you know, different level than when Tommy had started. And I felt that I had enough experience and enough knowledge at that point to, to be able to see it taken to the next level.

• 1:08:28Guy Raz?

  Yeah, I wonder, I mean, you mentioned earlier, you weren't on the Little League team, but you were also competitive. You were a competitor. And you're looking around, and I wonder if you were looking around and seeing the Tommy Hilfigers and the Calvin Klein's and the Ralph Lauren's, you know, as these international brands and thinking, I, I should be there, too.

• 1:08:47Speaker 01

  Absolutely. Ralph Lauren and Tommy Hilfiger and Calvin Klein and brands like that, suddenly, they were not strictly American brands. These were global brands. And I definitely thought by that point, I had had my experience working with Celine, and it was really time to find the situation that would allow me to take that, you know, that step to scale it up.

• 1:09:14Guy Raz?

  There was a quote from Lauren Stroll at the time, and he was asked, you know, why are you making this investment? And he said, you know, the, the reasons why, why Michael's business isn't bigger today is that it hasn't had a big insurgency of cash or aggressive management behind it, and we intend to bring both. So they were going to bring cash and aggressive management. And by the way, as I say, they spent $100 million on about 85% of the brand, which would prove to be an incredible investment. I mean, they would make a lot of money off that investment. But now you are, I mean, you are still a minority shareholder in your company, but it's, you know, you've got bosses and, and there are expectations. And, and how did that change how you operated? That,

• 1:09:56Guy Raz?

  did that, I mean, did that deliberate you to do, or did that put more pressure on you to deliver?

• 1:10:02Speaker 01

  Well, I mean, once again, if you do the same thing every day with no variance, maybe some people are very comfortable with that. I think I was ready and curious to try new things and with people who are experienced and curious the same as myself. Now, are there bumps in the road? Absolutely. You know, I remember, I remember the first, I think it was my first spring season with Michael Michael Kors and the women's apparel

• 1:10:44Speaker 01

  that season, I had always done for Michael Kors, we made a lot of sweaters. So I had a lot of sweaters on the collection. And all these sweaters get shipped all across America to department stores and they look great. I think they look great. And they end up not selling very well. And I couldn't understand why don't they sell well. And then someone said to me, well, they're not machine washable. And I said, what do you mean? As, you know, sweaters, most sweaters are not machine washable. What's the big deal?

• 1:11:19Guy Raz?

  Right.

• 1:11:20Speaker 01

  And everyone said, well, this customer prefers that most of what she buys is machine washable. And I just, I was kind of like, really? Like, no one told me. So you live and you learn. But Silas Chow and Lawrence Stroll and myself were all very experienced people who care very much about product and want, you know, what's next?

• 1:11:46Guy Raz?

  Michael, I'm curious about how you cultivate a sense of luxury and also, you know,

• 1:11:55Guy Raz?

  An affordable price. So for example, you can buy a Michael Kors t-shirt for 60 bucks. And you can also buy, you know, a beautiful halter jacket, women's halter jacket for $1,800. Right. But was there a conscious decision with these new partners, like, okay, we need like soccer fans in England wearing Kors shirts and we also need to appeal to, you know, high fashion customers willing to pay $1,800. But how do we cultivate that sense of luxury, you know, in, in less expensive streetwear? Was there, was there, is there a playbook on how to do that?

• 1:12:36Speaker 01

  I think the big playbook is never talk down to the customer. So whether it's a t-shirt or an evening gown, it's thoughtfully and intelligently designed. And we also have to remember in a, in a world that is casual, the richest person in the world does not fill their entire closet with $1,800 jackets.

• 1:13:01Guy Raz?

  No.

• 1:13:02Speaker 01

  And vice versa, someone who has a very casual life and doesn't have that kind of money to spend, they do have the pieces that they buy that are their splurge piece. So, you know, you might on a daily basis say, you know what, I live in leggings or jeans, but I'm going to sort of stretch and buy the handbag and the watch that make my jeans and leggings feel special.

• 1:13:29Guy Raz?

  Yeah. Meantime, the business is growing and eventually you're opening stores all around the world and the United States, Michael Kors stores. One of the things that's interesting to me is that over time, like within a sort of a decade of or less, you know, a few years of your partners coming in and joining you as investors.

• 1:13:53Guy Raz?

  The biggest part of your business started to become accessories. It wasn't clothing, it wasn't apparel, it was accessories. And I, and you alluded to this, but I have to imagine that that came from your time at Celine as well, having seen how big a part of their business, handbags and shoes were, that must have had an influence on your thinking.

• 1:14:14Speaker 01

  Absolutely. I think even when I was a teenager, if I sat and doodled in class in high school when I should have been paying attention to the teacher, I would sit and doodle shoes and glasses. This was just, if you looked at my notebooks, or I would sit and doodle, the MK logo that we use is something that I started doodling back when I was 15. So I always loved accessories, but I didn't realize that accessories were the ultimate democratic items in fashion until I spent six and a half years at Celine, that, you

• 1:14:55Speaker 01

  know, it didn't matter what the weather was, the same handbag worked in Stockholm and Rio de Janeiro.

• 1:15:03Guy Raz?

  Yeah.

• 1:15:04Speaker 01

  You know, the same watch was great in Jakarta and Chicago. You could be 17 years old or 75 years old. That's kind of the magic of a great piece of jewelry, a watch, glasses, shoes, belt, bag. Also, because I am practical, I particularly, I love bags because I love the fact that we all need the functionality of, you know, where are we going to put our stuff? So it's this practical necessity that also makes us feel a certain way when we use that bag.

• 1:15:49Guy Raz?

  I've always wondered, is it, are the margins better on things like handbags and shoes and accessories than they, than they would be on apparel?

• 1:15:56Speaker 01

  Well, the thing we have to remember about apparel versus a handbag, handbags don't have a size.

• 1:16:05Guy Raz?

  Right.

• 1:16:06Speaker 01

  In clothing invariably, and we all know when we go shopping, if you wear a size 34 jean and somehow you go to the store and they've got 100 pairs of jeans, and where is the 34? Why is it gone?

• 1:16:19Guy Raz?

  None, right, right.

• 1:16:20Speaker 01

  So you're upset. Whereas the handbag, if you fall in love and they have it, it's your size. So just from a business vantage point, it is more expensive to, you know, have that big size range, you know, versus being able to focus things like you can with handbags or glasses or fragrance.

• 1:16:42Guy Raz?

  Yeah, and handbags are walking advertisement. I mean, people are where are walking with handbags, say Celine on them, or that have a logo, or Michael Kors, or Kate Spade, or whatever it might be. I mean, and then other people see that.

• 1:16:55Speaker 01

  Absolutely.

• 1:16:56Guy Raz?

  The company went public in 2011, and still, of course, public no longer called the Michael Kors, now called Capri Holdings, because you're, you've got several brands under that, under that name. And so, you know, for the years that you were actively, you know, part of sort of the business, and you still are part of it, but, but, but sort of in there in 2011 and so on, you know, you're now a public company with a volatility of the stock market. I mean, at one point, you know, the, the company was valued at $15 billion, the market cap was $15 billion, and then it goes down to eight, and then 10,

• 1:17:36Guy Raz?

  and then seven. And did that, did that kind of volatility ever, did you ever feel stress or pressure from now having a publicly traded company where you're accountable to shareholders?

• 1:17:49Speaker 01

  For me, as a creative person with a business head, I'm never actually, as a designer, you're never in the time you're in. You're always working so far ahead of time. You're always thinking about what's next. Fashion is not, you know, able to turn things around so quickly. You know, the way that it that it was when I was at Lothar's, where if it rained on Tuesday, I could make raincoats for Thursday.

• 1:18:21Guy Raz?

  Right.

• 1:18:21Speaker 01

  You know, there'll be times, I have to admit, that I'll be in the middle of a meeting and I'm looking at at different categories of product and I will be loving or hating something. And then I forget what season I'm looking at.

• 1:18:35Guy Raz?

  Right.

• 1:18:35Speaker 01

  And I'll say, well, wait a minute. This is for when?

• 1:18:39Guy Raz?

  Yeah.

• 1:18:39Speaker 01

  But fashion is always about thinking that thinking ahead.

• 1:18:42Guy Raz?

  Yeah. Yeah, I wonder, I mean, you had, you know, from the time you were Lothar's to Michael Kors and really for probably the first 15, 20 years of your career, you were designing everything, but inevitably it's like being a chef. You know, when you got a Michelin three-star restaurant, then you you have an empire. You cannot oversee every design. It is impossible. Today, you know, between, you know, all the collections of Michael Kors, there's no way you can design everything. And so how do you? How did you get to a point where you could let go? And and cede some of that control? Because inevitably, there are going to be things that are designed that you just simply, you don't have the capacity to oversee everything that you might not like.

• 1:19:27Speaker 01

  OK, well, I always say it's well, first off, I I'm not sitting and sketching every piece myself.

• 1:19:35Guy Raz?

  Right.

• 1:19:36Speaker 01

  Am I touching every piece myself? I would say 95% of it, yes. I see it. So it's it's which I guess would be the same as a chef. You know, you might have a chef who says, oh, the last thing I want to do is put a Caesar salad on the menu. You know, everyone has a Caesar salad. Why do I have to have a Caesar salad? Well, can you make it the best Caesar salad? And can you put your own little spin on it to make it, you know, your take on the Caesar salad? So maybe that's similar to what I do. And I love the sort of conversation with creative people. And sometimes I'll say, I don't really, you know, I don't understand that. Explain to me why you love it.

• 1:20:20Speaker 01

  You know, it's similar to what people have seen me do on Project Runway.

• 1:20:24Guy Raz?

  Yeah. Not even people with the best instincts are not right 100% of the time. And I wonder, can you think of an example of a, of a design that you just didn't really love, but you agreed that it could be made and produced and it turned out to be a hit?

• 1:20:40Speaker 01

  Well, I live in New York, so, you know, and I wear a lot of black.

• 1:20:47Guy Raz?

  Right.

• 1:20:48Speaker 01

  And New Yorkers wear a lot, a lot of black. So sometimes, you know, I'll look at a colorful handbag and I'll say, well, I think that's going to look, you know, great in the photograph, but who, who really carries a colorful handbag? I don't understand. That I always say, well, you know, it's great and we'll take a photograph of it, but I know it's, it's not going to be that successful. And then I look at what's sold and I see that, you know, a pale blush pink handbag is at the top of our list.

• 1:21:26Guy Raz?

  Hmm.

• 1:21:27Speaker 01

  And then I have to sort of hit myself and remind myself, no, we're not only talking to people who live in New York City, we're not only talking to people who live in London or Chicago or Paris. These are all cold weather cities in the winter. You know, if you live in Tampa, Florida, year round, you are not experiencing the winter that someone in London or Chicago or Paris experiences. So you see things from a different perspective. So once again, I think it's, it's always to remember how to be empathetic. So I, I've definitely had that surprise many, many times.

• 1:22:12Guy Raz?

  Michael, I know that you are, you're the chief creative officer of the company. And so obviously you touch every design, as you mentioned, and the, the business today is massive. I mean, its market cap is over $8 billion. You own Versace, Jimmy Choo, and so obviously a hugely diverse brand, Capri Holdings. At this point, are you, I mean, do you ever get anxiety about, I mean, you went through a bankruptcy, you know, in the 90s and when you were much smaller, but now like, are you at a point where you're just so big that you are not worried, that you, you, you feel like this brand is?

• 1:22:51Guy Raz?

  You know, enduring and here to stay and nothing can kind of, you know, hurt it or damage it or topple it?

• 1:22:57Speaker 01

  Well, I think that, you know, after 40, what are we? Oh, my gosh. Forty-two years, 42? Yeah, 42 years. Forty-two years, we are definitely firmly cemented as a brand into so many people's lives and in their closets. And, you know, I've been with friends where, I don't know, we could be arriving somewhere and a car is waiting and they say hello to a friend, thinking that the friend is Michael Kors. Or I've been at the airport with TSA, I had a TSA officer ask me what it was like to work for Michael Kors.

• 1:23:40Speaker 01

  And I said, what do you mean? And she said, how long have you been there? And I said, my whole life. And she said, oh, and then she looked again and she said, oh, you are Michael Kors. Like, there's a person. And I said, yes. So at a certain point, you get firmly cemented as a brand. But there's definitely a person here and a designer here and an individual who's still, you know, still wrapped up in the thick of it and I enjoy doing it.

• 1:24:10Guy Raz?

  Yeah. When you think about your career, and we've talked about it now for several hours, and, you know, where you came from, and you always knew that you wanted to do this and you were competitive, you did have a drive and you were ambitious and you still are. How much of what happened to you and where you are today, do you attribute to? How hard you worked and how much do you think has to do with luck?

• 1:24:33Speaker 01

  I'm not a believer in luck in the traditional sense of the word. I believe in hard work. I believe in experience. I believe in curiosity. But my version of luck is how do you make sure that you leave yourself open to possibility?

• 1:24:57Speaker 01

  I've always been curious about and never limited myself about what could be next.

• 1:25:05Guy Raz?

  Yeah.

• 1:25:05Speaker 01

  You know, whether it was leaving school when I was 19 years old and saying, let me start working, starting my own business with no experience, running and figuring out how to go to Italy and sign this license, get out of Chapter 11 and deal with that and move forward. I've always really been willing to take an educated and calculated leap into what's next.

• 1:25:34Guy Raz?

  That's Michael Kors, founder and chief creative officer of Michael Kors.

• 1:25:40Speaker 01

  Thank you. My voice has definitely gotten huskier and huskier. I think I sound like a male version of Brenda Vaccaro.

• 1:25:47Guy Raz?

  You sound great. Or, what's his name? Atkins from Blue Lagoon. Chris Atkins?

• 1:25:52Speaker 01

  Christopher Atkins.

• 1:25:53Guy Raz?

  Christopher Atkins.

• 1:25:53Speaker 01

  Well, it's funny. I've known, I've known Brooke Shields forever and a day. And one year I took her to the Met Ball and I said to her, I said, should I wear a long curly wig and we can read, we do Blue Lagoon?

• 1:26:09Guy Raz?

  Hey, thanks so much for listening to the show this week. Please be sure to follow the show however you're listening. If you're listening on Apple Podcasts, just click the plus follow sign at the top. And on Spotify, just click the plus sign to follow the show and never miss a new episode. If you want to contact the team, our email address is h i b t at i d dot wondery dot com. If you want to follow us on Twitter, our account is at howibuiltus and mine is at guy raz. And on Instagram, we're at howibuiltus and I am at guy dot raz. This episode was produced by J C Howard with music composed by Ramtin Arablouei. It was edited by Neva Grant with research help from Sam Paulson. Our production staff also includes Casey Herman, Elaine Coats, John Isabella, Kerry

• 1:26:52Guy Raz?

  Thompson, Alex Chung, Chris Messini, Carla Estes, and Kira Wakim. I'm Guy Raz and you've been listening to How I Built This.