[birds chirping]
[children playing]
I was a mom to two kids
and I was on low income assistance.
I wanted to be able to go to the store and swipe my card
and not wonder if it was going to be declined.
And LuLaRoe said, you can make full-time income on part-time work.
In that moment I fell in love with the opportunity.
[Roberta] When I became a mom, I needed just a little bit extra,
even if it was just a couple hundred bucks.
A couple hundred bucks a month would have paid
for tickets to the movies or going to the zoo.
That was definitely something that caught my eye.
Part-time work for full-time pay, things like that.
[Lauren] I love being a mom
and I love being this independent person.
How do I make those two mesh?
That's it. You have a store in your house. It's perfect.
[Roberta] It just is, like, the dream.
Like, I can be at home with my kids, I can make money,
I can own my own business.
But joining LuLaRoe costs a grip of cash.
[DeAnne] We've always, since day one said,
don't go into debt to do this, please.
[woman] Packages starting anywhere from 5,000
all the way up to 10,000, depending on what package you got.
They wouldn't say go into debt per se,
but there's ways of saying things without actually saying them.
I do remember Mark and DeAnne encouraging people
to join the business any way they possibly could.
People make cookies.
They, you know, do all kinds of things.
LuLaRoe consultants even made videos like,
"Here's the 10-step guide to start their business."
You can get a credit card with zero interest.
You can borrow money from your grandma.
[Derryl] Some of these women were told they should sell breast milk
just so they could afford the initial startup cost.
Well, I say that's "udderly" ridiculous.
[laughs] Stop it.
She found out that she could
supply some of her breast milk.
She saved $4,500 so far
from selling her breast milk into the hospital NICUs.
$10,000 is a ton of money.
That's a lot of breast milk.
But that's a pretty small price to pay to own a business.
I saw other retailers making money.
You're going to make so much money,
you're not going to know what to do with it.
Be your own boss, be a boss babe.
I'm in charge of this. I'm a boss babe.
Hey, and maybe it is too good to be true
but I'm going to ride this wave until I can't anymore.
And I just wonder, like, what happened to me?
[LaShae] Nice to meet you. Hi, everyone.
Welcome, welcome.
I have candy in my mouth too, by the way.
Just because I'm nervous.
Mm-hm.
[interviewer] How does it feel to be sitting here?
I would say it's a long time coming, but I'm okay with it.
So I'm happy to be here to tell my story, I guess.
Before LuLaRoe, I was at Macy's.
I like fashion, so it's always been a thing for me.
A headhunting company called me,
and they thought I would be a good fit for this company called LuLaRoe.
It was good in the beginning, is what I will say,
it was good in the beginning.
[interviewer] Where is your office?
It's in Corona.
[interviewer] And what's the address of the building?
I don't know.
[chuckles]
[LaShae] The first time I met DeAnne was in the hallway.
I was walking through the hallway.
I was like, I got this new job
and I have on Chanel and I look really cute.
And I just remember this tall, white, blonde hair woman
walking by me and she turned around
and she looked like this, and she put her glasses down
and she says, "That's not LuLaRoe."
I said, "No, it's Chanel." And she marched me right to the warehouse
and had me pick out a few pieces and I had to put it on.
And she said, "Oh, you're the new girl."
Yep, I'm the new girl.
[Iliana] I started with LuLaRoe as a colorist
and became one of their head designers.
It was an opportunity that I felt I needed to jump on.
I had already been bartending a few years.
I wanted to do more with my life,
and at least, you know,
in terms of making my mom proud
or at least not worried about me.
I remember there was this one time at LuLaRoe,
I get pulled into the office for my review
and them telling me, "We're promoting you, Iliana,
but just so you know, just be aware that
you haven't worn any LuLaRoe pieces
in the last few days, but we're still promoting you.
I was like, "All right, cool. Thank you. Sorry about that."
My name is Derryl Trujillo.
I worked for the LuLaRoe home office from February of 2016
to September of 2017.
Before LuLaRoe, I'd worked at a Steve Madden.
Was there from April 2014
to just after Valentine's Day in 2016.
I was also reffing high school volleyball.
Reffing at a very high level.
It took me three years
to get to the junior college state tournament.
Sure, the money's good, but you just don't have,
you know 401k, you don't have medical.
My dad had told me that there was going to be a point in life
where you're going to have to choose between officiating
and a quote, unquote, adult job.
So I was actually poking around on Craigslist.
Saw an ad for data entry and customer service,
I thought, "Oh, I'd be okay with this."
Went there, quick little paper application.
They had, like, a color wheel, and we had to answer a bunch of questions
and it equated to what kind of color you were,
and it was confusing as all get-out.
I walked out of the interview thinking,
"This is the strangest job interview I've ever had in my life."
I was placed to the email department,
which was where I spent the remainder of my time.
We were the first line of defense for the company.
A complaint would be emailed to us.
If it was something we could handle, we handled it.
We tried to be the filter of the building.
There were good memories at the beginning.
In the break room there was, like, a sandwich bar.
Burrito man Friday-- whoever had the window desk
had to look for this guy in the burrito truck.
Literally the whole floor would empty out like a herd of cheetahs.
[animals stampeding, elephant trumpets]
I do remember Mark and DeAnne catering Chipotle for lunch.
We used to call it Chipoo-poo
for reasons I won't talk about on camera.
Mark and DeAnne were seldom around the office.
And whoever had the window seats had to keep an eye out
for either DeAnne's Mercedes or Mark's SUV.
That's how we knew they were coming, is by what vehicle they drove.
[car chirps]
[LaShae] The whole family, and I'm not even exaggerating,
you knew when they were at work
because you would pull up to LuLaRoe
and there'd be, like, six Mercedes-Benz 500 classes.
We show up every day and say, "What problems need to be solved?"
We're on the team. That's our team. We're here.
[DeAnne] So is our family.
Our children, they're there, committed,
and wanting to see what can we do to help others.
Eighty-five to 90 percent of the sixth floor was their family.
Lindsay Stidham did some culture and training development.
Kenny Brady was a leadership development guy.
Michael Brady was the head of accounting.
Justin was in training in leadership and development.
He married DeAnne's daughter Amelia,
so that's how he's woven into the family.
Did any of them have a clue how to run a company of this size?
No.
A normal company would have a system for data entry,
but basically anything in home office that involves
spreadsheets and data entry-- Google Doc.
A line that I saw would be blank,
I would cut and paste, but it would actually be a line
that you had cut something into.
So, like, there, there might be lag time between my cutting
and pasting and your cutting and pasting.
And you could see everybody trying to do their own thing
and do the best they can to manage this.
It just wasn't practical for the amount of issues
that we were dealing with to have that many people
with access to a Google Doc.
We've probably spent enough money
for her and I both to retire on software that we never used.
We'd buy it, we'd pay for it.
We'd be in the, in the standing it up process,
it'd be almost stood up, and we'd realize that it was obsolete.
[Sam] They just had never done it before.
They even like-- we're creating the compensation plan
on the fly, like, with Excel sheets,
and one of the sons was supposedly an Excel wizard
and was creating this, like, compensation plan.
[laughs]
Austin had no experience. He was, like, 23, 24.
But, you know, he supposedly knew a lot about Excel.
[laughter]
[LaShae] I started on customer service,
and I was on the onboarding team within three, four months.
Onboarding is your initiation to get into LuLaRoe
if you want to be a consultant.
You go online and fill out the paperwork.
The onboarding team will call you,
and we let you know you have been accepted in the family
and you can now purchase your package.
But you would be on a waiting list
anywhere from 90 to a hundred days.
So we literally had these women waiting for our calls.
"Hi, this is Shae from LuLaRoe," and it would go berserk.
They would start screaming, "Oh, my God, I'm ready!
Oh, my God, thank you for calling me!
-[women screaming] -Oh, my gosh, I've been waiting."
These were people spending anywhere
from five grand to 10 grand for some leggings.
[Derryl] Folks in my department were asked to help the onboarders.
Sometimes we called prospective retailers ourselves to onboard.
I remember calling a lady in the middle of her own bachelorette party.
She had to step outside of the club to take the call, first of all.
[women screaming]
Then I hung up and I looked at the rest of the floor, and I was like,
"I just onboarded a lady in the middle of her bachelorette party."
And the chuckles on the floor.
[phones ringing, indistinct conversation]
It was a rat race to get to those numbers
that Mark and DeAnne wanted.
I mean, take a half-hour lunch if you have to, but you gotta push it.
You've got to make numbers.
They wanted us at our desk onboarding all day long.
Mark had a specific number he wanted to be met.
He would come to me and tell me,
If I want to onboard 500 people on Saturday,
tell me what I need to give to you
so that we can be successful.
Hi, Mark and DeAnne, we wanted to share something with you.
We just...
Hit 2,500! [cheer]
We were bringing in over a million dollars a day
just with my group alone.
With LuLaRoe, you had this perfect storm of factors.
The rise of social media.
I think we need to go live.
[indistinct chatter]
[Jill] You had a lot of American families that were struggling
and needed some extra income.
You have communities of women who are more educated
than women of any previous generation in America,
but many of whom are at home and not working full-time.
You had the rise of athleisure brands.
And so LuLaRoe kind of jumps right in on that moment.
They tell women, "You can be a mom first,
and then you can do this side hustle."
But the feminine vision of the stay-at-home mom
is a very white vision.
The underlying understanding is that that's a vision
of white womanhood, and it's a vision of a white family.
What they are catering to and making aspirational
is a racially coded vision.
This is a white girl business.
I'm gonna tell you right now, there is not a lot of diversity
in this culture of LuLaRoe.
And I definitely stick out like a sore thumb.
Before LuLaRoe, I was a work-at-home/stay-at-home mom.
I got the phone call, and I actually still have the number in my phone
as "LuLaRoe," with a little unicorn, "Life-Changing Call."
I believe that if you put it out there like a vision board, you create it.
So having that call saying "Life-Changing Call"
meant this was going to change my life.
[Roberta] I joined the queue in 2016.
You could check your name on this list on this website.
We would refresh it constantly.
There was groups where people are asking,
"What number are you in the queue?"
"Oh, I'm number this. Oh, I'm five away from you."
"If you're getting onboarded today, I should be onboarded tomorrow."
It was like a frenzy.
[Mark] At one point in time it was almost eight weeks
to get through the queue.
The purpose of that was to give people a real chance
to identify, "What am I getting into?"
It was that thing that people said, "Oh, I want to be part of that."
It's like, okay, we got to slow down to catch up.
[Roberta] I remember looking down, and it said LuLaRoe.
And I was like, "Oh my God, it's the call, it's the call.
It's-- this is, this is happening, this is happening."
And I just remember answering the phone
and LaShae being so kind and bubbly
and made what seemed to me
like it would have been a stressful situation, like, very fun.
[Stella] As I finished college and decided to get married
and have kids, I had the dream of being a present mother.
How was I going to find $5,000
when I couldn't find five dollars for a box of cereal?
And I said, "Can I put this on multiple credit cards?"
And they said yes.
[Stella] It's a few thousand dollars that we didn't have.
And when my mom said she'd loan me the money,
I signed the contract.
I spent close to $9,000.
I thought, go big or go home girl, like, fill those racks.
You fill that room up, and you're going to sell it.
I think it was about six weeks wait,
and in that six weeks time I cleaned out a room in the house,
and I painted it and I bought the shelf for leggings,
and racks and hangers and all of this stuff.
A thermal printer, a desk so that I could do my shipping
on the desk and getting a stamps.com account.
I moved all the stuff out of my one son's bedroom.
I turned our nursery into a LuLaRoom.
[Roberta] Spending all of this money to get ready
for when the clothes were going to come
because they always said once the clothes are there,
like, you're going to hit the ground running.
So you better be prepared.
I remember I was camping with my family.
I thought, "This is the last vacation I'm going to have
before my life gets crazy," and there was no service,
and so every day I would leave the campsite
and drive to the top of this mountain and check my tracking.
And I remember driving up there,
I've never told anybody this story, but I remember driving up to the top
and it was like, your stuff has been delivered.
And I remember freaking out, driving back down
to the campsite and saying, "I gotta go. I gotta go."
And I packed everything up and I went home.
Brought everything inside and started unpacking all these boxes.
I think seven boxes arrived.
And I have a picture of, like, me holding my son
with all of them before I even opened 'em.
And I was like, "This is going to be amazing."
We can see you.
[woman] Hi!
Hello.
Go ahead.
So my name is Tiffany Ivanovsky and this is my husband, Paul.
We joined LuLaRoe in May of '16.
We always were in the top 10, as far as sales.
And for a long time, we were definitely in the top three.
As far as how Paul and I met?
She just got lucky.
Didn't I ever! We were both Mormons.
It's the church of Jesus Christ of Latter-Day Saints.
We just kind of happened to meet at a church activity.
Paul didn't have a car and I had a car, man.
And so it worked out.
I asked and I received.
Oh, my gosh.
We have seven kids. Ages right now, 10 to 23.
I love to write, so I started blogging.
I blogged a lot about couponing
and how to save money and ended up on some TV shows.
My name is Tiffany. I am a mother to seven kids.
And me and my litter are all about extreme couponing.
I have coupons for these.
But do you think the 40 boxes we have at home is enough?
My children call our home the Ivanovsky mini mart,
just because you're going to find all kinds of groceries
all over the entire house.
We just taught everyone the deals that were coming up that week,
and, you know, what season we're in
and how to take advantage of that.
Trying to help people save some money.
For Valentine's Day 2016,
someone sent me these leggings for my daughters,
and I kind of wanted matching leggings.
I wanted us to all look alike.
So I got online to try to find us matching leggings.
And that's originally how I found LuLaRoe.
Jeez, I think we were signed up by...
It was May 6th of 2016.
When all of my inventory came,
I was teaching classes all day
and we had been doing Facebook Lives for a little while with our blog.
I asked Paul, I said, "Hey, could you go live in my group
and just un-box this stuff and maybe just show these ladies?"
Everybody kept asking him just to go ahead and sell it.
Well, he didn't know what it was.
The girls that were watching the video were Googling it for him,
they were telling him how much this stuff was.
And he's like, "All right." So, he's like, "Do you want to buy it? Buy it."
Here we go, I've got a medium.
He literally, that night, sold every bit of inventory.
That very first month we did $49,500 in sales.
And then the next month we did, I think $127,000.
[Paul] ...XL and bigger shirts...
At that time, I think there was only one other
team that had done that before.
Mm-hm.
What made LuLaRoe grow and be so successful
was the exclusivity of the product that you were getting.
We're selling about a hundred thousand garments a day
and we make 3,000 or less of any single print.
So if you get, like, this floral,
there's less than 3000 garments made with that pattern right there.
And so there's some uniqueness to it.
And it's been kind of part of what defines us as a brand.
Patrick Winget was the chief merchandising officer
at LuLaRoe, and he was my boss's boss,
essentially was my boss.
He was always in black. He almost reminded me
if you crossed Kanye with the Olsen twins.
[laughs]
I forgot about that.
He was a bit of a smartass, but in LuLaRoe,
Patrick was, like, big celebrity.
I was a fangirl of Patrick. I thought he was so cool.
He would say so many wonderful things and pertinent things
about the brand and the clothing and how to style it
and how we are the beauty consultants.
He was wonderful at that.
I know that our mission statement is to bless lives
and strengthen families, but one thing that we try to do
in the design, enrollment and production department constantly
is make sure that your existing customers
are just as excited about LuLaRoe as the new ones.
Patrick's go-to word was this one needs to pop,
that one needs to just, it needs a pop.
So I got used to making patterns that stood out in some way.
I remember at one point I made a print
that was like a unicorn, and then the pink doughnuts
with rainbow sprinkles.
Honestly the clothing,
sometimes I would think it would be super tacky,
but you know, one man's trash is another man's treasure.
[Tiffany] You never had the opportunity to pick
what pattern you were getting.
Now you could choose if you want a skirt or a shirt or a dress,
and you could choose your sizes,
but you never had the ability to choose the pattern
that was coming on that product.
This dress is awesome, let me tell you why.
It took us a year to get this thing right.
As soon as a print got popular, it became rare, right?
And then they ate that shit up, of course.
[Roberta] You don't know if you're going to get, like,
the best stuff that you can definitely sell
or are you going to get a box full of donkeys that nobody wants.
If you're looking for something, and it's, like, your ultimate dream print,
it's called your unicorn.
["Rhythm of Me Too" by Meghan Trainer plays]
[Roberta] There was a print of octopus leggings that I really, really wanted.
That was the first time that I went unicorn hunting.
Just the feeling of looking for something and finding it
in your size and then buying it,
and then it showing up was, like, an incredible rush.
-We've always want-- [gasp] -Oh, my God, look at that.
When I started selling LuLaRoe, most people sold in person
at in-home pop-ups.
But I definitely experienced more of that frenzied rush
when I sold on Facebook Live.
It was all over social media. That's really how we took off.
That's really when Facebook Live was starting.
I mean, if it weren't for Facebook,
I don't know how else we would have sold, really.
-Going live. -Am I live?
Amazing. Hombre tie-dye.
Wendy.
Glenda, I'm going to put you for the medium
because you do not need a large.
Wendy.
[man] These are going to start at a bid at $5
and go as high as you bid.
[woman] Extra small. 677.
People were making ten and twenty thousand dollars a day,
and I was like, "Um...
I think I might be in the wrong line of business."
[LaShae] I wanted to go live and let you guys know, you heard it here first.
It's official, I am a LuLaRoe Consultant!
Whoo-hoo!
This is what I would do. I got a package today, right?
So I'm going to take pictures of my boxes and then
I'm going to post it on my Facebook.
And I'm going to say, "I'm gonna go live at six o'clock."
Six o'clock hit,
I have about a thousand people waiting for me.
Hi, I have this Randy t-shirt. It's yellow.
It's got these lines right here.
This is a medium. This is number 28.
These are super cute, 267.
As you're saying that, you're looking on the screen
and you'll see somebody saying, "Sold 28."
So then you'll say, "Oh, hey, Jessica, you like these?
Okay, these are yours." So then you write Jessica on here.
Thank you, Christie!
Oh! [blows kiss] Jackie...
[interviewer] So are you Facebook famous?
Yes. [laughs]
Yes, I am Facebook famous.
Thank you for being here with me tonight. I sold a lot!
They can create what you call FOMO
or the excitement, the urgency for these prints.
They had to buy them right then if they wanted it.
And so Facebook Live was huge in the growth of sales for LuLaRoe.
Hey, hey, hey, you guys. We're gonna go live here.
In LuLaRoe, there's two ways to make money.
You either sell the product
or you recruit people to sell the product as well.
You make commission off of those people that are underneath you.
And the people above you make commission off of you.
Anytime anybody onboarded, it was, like, a big,
like, five to nine thousand dollar package,
I would get, like, a three-ish hundred dollar bonus, just like that.
You were originally a retailer.
Then, when someone signed up underneath you,
you were called a sponsor and you got commission
off of how many clothes they bought that month.
But that's inventory bought by retailers from LuLaRoe
not sold to customers.
As a retailer, you had to buy a certain number of pieces
each month in order to stay active.
So the more people you recruit and they buy inventory,
the larger the bonus check.
[Courtney] When you had 10 people under you,
you moved up to the rank of trainer.
You were still getting your five percent off of
how many pieces were ordered per month.
And then you were getting a trainer bonus on top of it.
Yeah, so this is the watch.
[Lauren] Everybody wanted the trainer watch.
Who doesn't want to be recognized?
And get this gift that you've worked so hard for.
It says LuLaRoe, and then, on the inside,
"Be the kind of leader that you would follow."
I did want to be the kind of leader
that people would want to follow.
And I loved the watch.
The next rank is coach. And to be a coach,
you have to have three trainers underneath you.
To become mentor level,
which is the highest level in LuLaRoe,
you had to have three coaches underneath you
who had three trainers underneath them.
And that made you mentor.
The highest rank that I achieved was mentor.
[interviewer] And how many people were in your team?
Um...
I honestly don't know. About 5,000.
[interviewer] Was Lauren on your downline?
Yeah.
So Ashleigh was... not right above me.
I mean, I'm definitely in her line, but I'm not sure where I fall.
[Stella] Mentors and the coaches, their bonus checks.
I've seen screenshots up to six-figure numbers.
The message was clear:
Keep growing your team, and you'll be like me.
[Courtney]There was always a huge push to recruit, recruit, recruit.
Buy, buy, buy, recruit, recruit, recruit, you will get there.
And so that's mainly what I focused on.
And I actually let my sales slip because I was more focused
on recruiting people.
[Roberta] My boutique kept itself afloat.
I purchased wholesale, like, $78,000 worth of wholesale inventory from LuLaRoe
in my year and a half I was there.
I sold, like, 83,000.
So it's only a few thousand dollars.
And with my business expenses, it kind of was like a wash.
But in bonuses, I made over $65,000.
So where's the real money to be had here?
I would get text messages at, like, 9:00, 10:00 at night from my upline saying,
"Hey, I got a hot one. She wants to join right now.
Get online and send her your link. She wants to join right now."
I didn't even know half of the girls that joined
underneath me because they weren't people that I knew personally.
They were people that I was given so that I could
rank faster so that those bonus checks could be
padded nice and fat.
[interviewer] So explain the bonus
and how it related to the business model.
Okay. So the, the fact is fewer than 20 percent...
-Wait. -What?
You're going to get logical, hold on a minute.
Okay. [chuckles]
The whole point of getting a bonus plan was this:
The business was growing.
It was growing so fast and I was doing all the training
and I was like, "Oh my gosh, I can't do this."
There were other people that were saying,
"Hey, my friend, my neighbor, my sister wants to join,
and they need to make money."
And I sat there and I thought to myself,
"Wouldn't it be awesome if they got a little bit for telling the story?"
That was my mindset.
I did not create the bonus program.
[interviewer] You were involved in it, correct?
Nope.
[interviewer] Did you ever consider LuLaRoe
an MLM or a multilevel marketing company?
Nope.
I like to refer to our plan as multilevel management
because we're more of a wholesaler-to-retailer business
with a component of our leadership plan
being designed to compensate mid-level management
and instead of hiring people to take on that role,
paying people in a structure inside the business
to perform those functions.
[Sam] The bonus checks started getting bigger and bigger and bigger,
and I was like,
"How is this girl making $200,000 this month?
How is this even possible financially for the company?"
[Ashleigh] I was making really great money.
You know, the bonus checks from building a team.
[interviewer] When you say a "bonus check"
is there a ballpark that you'd feel comfortable giving us?
For sure not.
[laughs]
[Paul] I think at our height, we had 1,100 members on our team.
The highest bonus I believe that we made,
-I think it was 42,000. -It was 42.
[interviewer] That was a monthly bonus?
Correct.
I would say even 12 months of bonus checks,
anywhere monthly between 22,000 and $42,000.
So we have all kinds of news. We have all kinds of stuff.
We do have some Halloween leggings left.
I remember getting a call from DeAnne,
and her message to us
was that we needed to really focus on building our team.
I remember one time, I won't say her name,
her bonus check for the month was $70,000.
And I remember 'cause we went to Louis Vuitton
and we all got matching bags.
Within almost a year I reached mentor status.
-[woman] Courtney the mentor! -[women cheer and applaud]
My largest bonus check was $51,000 for the month.
I bought two brand-new vehicles.
I even had "LuLaRoe 3" on my license plate.
I tried to put "LuLa Bro" on my husband's license plate
and he told me, "No, we're not doing that."
I recruited by showing people how much money you could make
if you joined LuLaRoe.
[Roberta] And that was exactly what LuLaRoe wanted us to do.
There were certain posts on social media that they wanted us to post daily.
Like, made a big breakfast this morning,
so thankful for LuLaRoe that I can stay home with my kids
and we can make big messy breakfasts.
If anything was positive in your life, it was always because of LuLaRoe.
[interviewer] It says "hashtag because of LuLaRoe."
Are you familiar with that hashtag?
I see it. Yes.
[interviewer] Do you know what it means?
No.
I had taken a picture outside my home,
and a lot of people commented that you have a very pretty home,
and DeAnne was extremely upset
that I had not hashtagged that Instagram post
"because of LuLaRoe."
She only got two likes, that's sad.
[man] When I say LuLa, you say Roe. LuLa!
-[audience] Roe! -[man] LuLa!
-[audience] Roe! -When I say LuLa...
[Courtney] Going to the leadership events was so exciting.
They put on the show of all shows.
These events inspire us as leaders in the company.
They were actually one of the best parts.
Big balls of fun and food and glitter and music.
The energy was high, everybody was feeling motivated
and successful and accomplished.
They always made all their events so fun and energetic.
They made me feel excited and important
and connected to this message of LuLaRoe.
[Sam] When there was a waiting list
of, like, thousands of people waiting to get onboarded,
we said, "You know, it would be fun to get those people
on the waiting list to come to the event still."
And someone had this idea to do a drawing.
Everyone in the queue stands up, they had a card.
And if you had the ace of hearts or the king of diamonds,
you got to get onboarded that day,
and you may have been in a six-week wait.
And, oh, my gosh, people were flying to every event
just to try and get the golden ticket.
Right?
It was like Willy Wonka and the Chocolate Factory.
It's like...
♪ I got a golden ticket ♪
["I've got a Golden Ticket" plays]
♪ I've got a golden ticket ♪
And then one day I said, "Someday we're going to go on a cruise."
I came out of the room and I'm like...
-[laughs] -So...
But that was her vision, and we made it happen.
[cruise ship horn blaring]
[Ashleigh] The LuLaRoe cruise is a big incentive,
and a big part of, like, a goal for people to reach for.
The LuLaRoe cruises have been probably
one of the best experiences of my entire life.
I have earned at this point in time five LuLaRoe cruises.
So I'm now working to qualify for my sixth.
We were always taught that we had to lead by example and cruise qualify,
which meant selling $12,000 worth of clothes per month.
[LaShae] If you were on a boat trip
it was because of what you did for them,
whether it'd be sales or recruitment.
But if you were on a boat trip, you were big in both areas.
I was invited. I did turn down the cruise.
Um... [chuckles] God.
[sucks teeth, sighs]
Being on a boat with a whole bunch of white people like that,
just not my thing, I'm so sorry. I just had to say it.
I love white people to death, just being on a boat
in the middle of nowhere,
and it wasn't only but a handful of us, if you know what I mean?
I'll just pass. I'll see y'all when y'all get back.
But thank you for the invite.
[Tiffany] In the beginning, you know, all the events
were really, they were fun.
I mean, it was exciting. You got to meet people.
You know, but things would start to happen
that kind of took away that fun part of it.
Like we never got to enjoy those trips
because we were working the entire time.
We had to teach and to do instruction and to help people.
You were required as a leader to attend those events,
and they are expensive.
You were paying for the ticket to go there,
you're paying for the lodging, you're paying for your food,
you're paying for every aspect of that.
I felt pressured to be there, to act like I was having a lot of fun there,
but I really just missed my family.
If we're having a training and you're going to sit your butt in a chair
for eight hours and listen to people
tell you how to build your business better...
For two days.
You know, for two days in a row, when they know
that interspersed with that training is going to be entertainment
and opportunities to socialize,
it makes an event a lot more attractive.
[interviewer] Did you do anything in front of a crowd at Vision?
-Yeah. -[interviewer] What did you do?
Danced my butt off.
[interviewer laughs] Was it fun?
Yeah. Dancing's fun.
[Sam] I think after the first event I put on, you know,
I had a budget, and then after that, Mark was like,
"Hey, Sam, you have no more budget, just do your thing."
So for Convention 2017, I booked the stadium
and I booked Katy Perry.
We hired-- I don't know the person's name. Katy something.
-Katy-- Katy Perries. -Katys-- Katy Perries. Um...
[sighs]
I think I remember when we, like, said Katy Perry,
DeAnne, she was like, "No."
Like, "You mean the girl that, like, sang about kissing another girl?
Oh, no, we can't have her."
[Lauren] Who does not want a Katy Perry concert to yourself?
That was amazing.
♪ And you're gonna hear me roar, whoa ah, ah, ah ♪
[Sam] They probably spent a total of $30 million on that.
Katie Perry alone, they probably spent five million.
I mean, Angel Stadium was like a half a million,
sound was probably another million, concessions,
decorations, [exhales] parking, security.
Adds up, bro.
[interviewer] I understand LuLaRoe has experienced tremendous growth,
so I'm just trying to get a sense of that.
We averaged 25 percent growth month over month.
I mean, I'm a numbers guy,
and I couldn't believe the growth that we were having.
And I just kept, you know, we kept trying to keep up,
and we would project wild projections.
And then we would surpass them.
I described it as being at the Thanksgiving table
and eating so much that you stuffed yourself in the face
but you still keep eating 'cause you can't stop.
I mean, you name a system inside of the business
and with that kind of growth, every one of them was under pressure.
[Derryl] The email department was expected to do 150 emails a day.
Nobody even really cared about the quality of those emails.
We had to correct missed deposits,
deposits that went to the wrong accounts.
[Iliana] In our world, in the design end of it,
yeah, it was a shit show.
I would be sitting at the computer knowing that I had to
have at least, like, a hundred prints by the end of the day.
And they didn't really explain why the demand was so high,
but we understood that the company was just getting really big.
You would think I had my ideal job.
I get to make art for a living.
But, yeah, I was making art with a gun against my head.
[Sam] We ended off 2015 at $70 million.
And then 2016, we ended off at 1.3 billion.
In 14 months, I experienced $2 billion worth of growth.
I'm not qualified to run events
and marketing department for a million-dollar company,
let alone a billion-dollar company, you know?
Little did I know that I'd be flying
on a jet with, like, leggings company.
[Sam] DJ dance party with Lara the stewardess!
I remember we'd get on and the pilots
would be like, "Who are these guys?"
Like, they were used to flying Justin Bieber, and Bruno Mars
and Ty Dolla Sign.
And here we are, just, like, bunch of dorky dudes
wearing leggings.
Vision 16 LuLaRoe convention.
There was a lot of desperation of keeping the people happy.
Amongst underlying massive issues was like,
let's just shower them with Disney
and stars and stripes and...
Katy Perry, you know?
[interviewer] Do you feel like LuLaRoe was a pyramid scheme?
Yeah, yeah.
It had the same infrastructure, the same compensation plans.
The same way of recruiting. Yeah, definitely.
Multilevel marketing companies are often called pyramid schemes.
But MLMs are not illegal. Pyramid schemes are.
And the way that multilevel marketing companies
differentiate themselves from pyramid schemes
is that they say they're selling a good.
LuLaRoe says that because they exchange goods for money,
they're not a pyramid scheme.
But the primary way that many salespeople are making money
is not actually by selling the clothing.
[Robert] If you look at a multilevel marketing scheme,
you will see that over half of all the money goes to the top one percent,
and over 80 percent have nobody below them. They have to lose.
So the structure itself dooms the vast majority.
[Courtney] To see those kind of numbers hit your bank account...
My husband couldn't believe it. He was still working.
People asked why was he still working?
Because that money was spent every month.
Do I go and buy some nice things for myself? Sure do.
Bought a Louis Vuitton handbag. I deserved it.
I'm not going to apologize for that.
They very much encouraged
spend, spend, spend that bonus check.
They wanted you to look good to recruit people
and to live this fabulous lifestyle.
I remember one dinner, spent almost $10,000
at dinner that night, and I acted like it was nothing.
Actually, I just handed my credit card over and was like, "Charge it."
I would start to max out the credit cards,
living paycheck to paycheck.
But my empire was growing.
I had over 2,500 people under me on one team at that point.
What they're telling me to do is working, I got to keep doing this.
I didn't even think twice about it,
but looking back, I wish I could take back everything I did...
because working for LuLaRoe
absolutely destroyed my life.