Consumer Products and Retail: Kendra Scott, LLC
Founder & CEO
Indulging a passion for fashion
As a consumer, Kendra Scott’s search for stylish, customized and affordable jewelry usually ended in disappointment. So she started a company and did it herself.
Kendra Scott learned about fashion, beauty and the value of hard work from her family. Her mother was a Mary Kay consultant, and a favorite aunt was the lead fashion designer for a Wisconsin department store.
“My family taught me that if you love what you do, work hard at it and treat people right, you can achieve anything,” says Scott, raised in Kenosha, Wisconsin. Her mother, who balanced a full-time job with raising five children, “was truly the one who first inspired me to be an entrepreneur.”
But it was a personal crisis that motivated Scott to start her first company. Her stepfather was diagnosed with brain cancer when Scott was a 19-year-old college freshman. To support his battle against the fatal disease, she left school and headed to Houston to be at his side. While there, she created The Hat Box, a line of comfortable and fashionable hats for women going through chemotherapy.
Scott was inspired by women she had gotten to know during her stepfather’s treatments, and she donated a large portion of the proceeds to cancer research. The business struggled, however, and closed five years later.
“I lost my first business and my savings, but somehow I didn’t lose my entrepreneurial spirit,” she says. “Looking back now, I know that The Hat Box taught me that my passion was to create a business that did something more — that did something good — in honor of my stepfather.”
The next venture advanced her entrepreneurial mission. The idea behind the Kendra Scott jewelry and design enterprise was surprisingly simple: “I couldn’t find the designs I was looking for,” she says. “I noticed a white space in the market for quality, affordable gemstone jewelry and seized the opportunity to design my own.”
With $500 in cash and a 3-month-old son to care for, Scott spent 2002, her company’s early days, wrapping gemstones by hand in a small spare bedroom and going door to door to boutiques in Austin, Texas. Sales slowly increased, and the business took off.
While hers started as a wholesale operation, the 2008 recession convinced Scott to rethink the business model. “Businesses all around us were shuttering their doors. But I decided to take a risk. We launched our e-commerce business and opened our flagship store,” she says. “These were risky moves at the time, and I was slightly terrified. I had to put the fear of failure out of my mind and concentrate on success.”
Her flagship store, launched in Austin in 2010, featured a distinctive look. “I designed the Kendra Scott store to feel like a room in my home, rather than a traditional store — a warm, inviting, engaging experience to make our customers feel like family and build loyalty,” she says. The strategy has been a success, and the company expects to grow to 75 stand-alone stores nationwide by the end of 2017.
Innovation wasn’t confined to store design and retail strategy. Scott developed the Color Bar for women to customize their own highly versatile jewelry sets. The concept predated the customization trend that subsequently has swept through the accessories industry. The Color Bar customer experience, available through the company’s stores and website, accounts for 16% of the total business.
What Scott calls the company’s “secret sauce” — forging powerful partnerships in her community and with local charities — has become an integral part of the business. In 2016, the company worked with more than 3,500 organizations across the US, donating more than 1,500 pieces of jewelry and committing $3.5 million to charitable causes. Scott hopes to raise that commitment to $5 million by the end of 2017.
That focus is part of the Kendra Scott philosophy, built on three pillars: family, fashion and philanthropy. “When I started my company in 2002, I was a new mom. It was so important for me to create a work culture that allowed me to put my family first and follow my dream at the same time,” she says.
Workplace amenities round out the cultural commitment to employees. Smoothie bars, in-house nail salons and paid days off for philanthropic pursuits are a few of the popular perks that promote worker satisfaction and collaboration. “When I look around at the inspiring, dedicated women and men that make up my company, their hard work and passion is so much of the reason we’re experiencing this success today,” she says.
The next steps for Scott and her company are coming into focus, as she looks to expand into the home decor and beauty industries. Part of that growth strategy involves taking on new partners and investors, such as Berkshire Partners. “If someone had told me 15 years ago I’d be running a $1 billion company with 2,000 employees and 75 stores across the country, I wouldn’t have believed it,” she says.
Finalists (Consumer Products and Retail)
Lee L. Bird III
Chairman and CEO
Founder and CEO