Former Inc. cover story subject Brandi Temple built her children's clothing company, Lolly Wolly Doodle, into a phenomenon by unlocking the power of social media for sales. She became an unlikely star entrepreneur, with backing from big-name investors. Then Facebook changed its algorithms. Then the boardroom fights began. She looks back on some hard lessons.
In 2014, Facebook made some changes that affected your business model. What happened?
We'd been taking orders directly in the Facebook News Feed, and it was vital to our business. But when Facebook switched over to a pay-to-play platform, it closed the funnel so suddenly. Our sales went down something like 50 percent in a month.
You'd raised venture capital from some powerful investors. How did your board react to the problems?
I was this great story of an unlikely entrepreneur with no pedigree who was teaching herself as she went along. Everyone thinks that's amazing when things are going well. But as soon as the wheels fall off, they see someone who doesn't know what they're doing. So the board decided to bring in some more seasoned executives. They were right to do that, but they brought in the wrong people, who tried to change the DNA of the business. It was a stable business that was growing, just not as quickly as it had been. But the nature of the VC world is they want home runs and nothing else.
Were you in danger of being pushed out of the company?
When the new executives came in, one of them became president of the company. She started turning it into more of a traditional retail brand. The strategy didn't work, and our relationship was getting hostile. Eventually, the board called an emergency meeting, and both of us presented our cases for saving the company. It was, hands down, the most nerve-racking thing I've ever done, but the board unanimously sided with me and dismissed the president. I won my company back.
But then, in late 2017, you sold Lolly Wolly Doodle to a private equity firm. Why?
When I won the company back, I had no sense that the board was thinking exit strategies. They said I had their complete support. But they were clearly thinking short term. I tried to resist the sale, but I was outnumbered. The firm that bought Lolly was not aligned with my goals for it, so I knew it was not possible for me to stay on. They said at the time that they were committed to local manufacturing, but within six months, they shut down the Lexington, North Carolina, operation completely. I drive by it every day.
Will you start something new?
I will do something not too far in the future. When they shut down the factory, they auctioned off all the manufacturing equipment, and I bought it.