Buckle up, friends. This is going to be a long post. Strong language is used.
Some of you know that I used to buy LuLaRoe (LLR) clothing for two years, from 2017-2019. At the time, I had no clue it was a multi-level marketing company, or MLM.
Now, Amazon Prime Video has released a decent documentary that features the founders, former front office employees, current and former “retailers,” and a few more.
NOTE: I originally set this post to publish on September 20th after having re-watched Episodes 1 and 2, thinking I was going to be able to re-watch all four episodes before the post published automatically. That didn’t happen. It published automatically, and I forgot about it for a few days. I decided to update the scheduling to publish it on September 24th after needing to re-watch Episodes 3 and 4 and make my notes about it. So the updated publishing date is actually September 24th.
Episode 1 – Start Up
I can’t believe the producers of this documentary were actually able to get DeAnne and Mark Stidham on camera! I’d love to know how that conversation went. Wow!
You are the boss of your business! — Hahahahaha. No, you’re not. MLMs are not legitimate small businesses. Period.
Independent fashion retailers — No, actually, you’re an independent contractor. And you have to pay taxes!
$5,000 buy-in (Say WHAT?!?!) Holy moly. This one blew my mind. What the fuck? I could do so much with $5,000 – So much!
Selling breast milk to afford start-up costs — Ummmmm. Yeah. That’s absolutely insane. Nope!
A million dollar company to a billion dollar company. — It grew way too fast, and no one was able to keep up. Plain and simple.
Weight loss surgery — What the actual fuck. No, no, no.
Roberta Blevins — Amazing woman! I have a link to her podcast above! She is awesome!
“Why are the leggings wet? Why does the whole house smell like dead fart leggings?“ — Right on, Roberta! Inferior product doesn’t sell!
“LuLaRoe tricked people into joining a pyramid scheme.“
Actual depositions from the State of Washington v. LLR — I laughed and cringed at the same time!
Mark spouting passages from the Book of Mormon — Yeah. Roberta was right. You are/were in a cult!
LLR logo is a pyramid!
DeAnne’s maiden name is “Startup.” Seriously!
DeAnne is the 10th of 11 children. She has a twin sister, Diane.
Mark is one of four kids. Never wanted to work a job or work for a boss. “When you’re an entrepreneur, there’s no upper limit.”
1988 – DeAnne went to a swap meet in California. Bought four dresses from a man. Started booking dress parties. The first party sold 300 dresses. DeAnne did that for 27 years.
She started making maxi skirts after her daughter asked for one. Sold 20,000 maxi skirts quickly. Mark started in production.
2012 – Brittany Hunter from Utah, came and got skirts out of DeAnne’s van. DeAnne and Mark officially formed LuLaRoe, LLC in 2013. The name comes from three of their granddaughters – Lucy, Lola, and Monroe.
What I really liked about LuLaRich was the group of people they interviewed. When I first saw the trailer, I was pretty sure the producers had only interviewed DeAnne, Mark, and both former and current fashion retailers. It was really nice to see journalists and other experts, too! And home office employees that really spilled the tea.
For those who may not know, MLMs have been around for a good long while. The first one in the United States was Nutrilite in the 1940s, and then they were purchased by Amway. Other MLMs include Tupperware, Mary Kay, Pampered Chef, Scentsy, Herbalife, and Rodan + Fields. But there are a lot more – I remember hearing for either this documentary or Roberta’s podcast that there are about 300 active MLM companies in the United States. And many of them have gone global to other countries. Ewwwwww.
What is really being sold is the opportunity.
You can only go about 13 levels, and you surpass the population of the Earth.
Even though MLMs have been around and growing since the 1940s, it’s really exploded in the last 10 years or so. It’s advertised primarily through social media.
Buy it for wholesale, sell it for retail. It’s not get-rich-quick. —- Yeahhhhhh. Right.
Mark: Underutilized resource of stay-at-home-moms (SAHMs). A lot of people of faith attracted to this business. It’s a pure meritocracy.
Meritocracy: Government or the holding of power by people selected on the basis of their ability.
Sam Schultz, DeAnne’s nephew, joined LLR in 2015 as the events director. Part of the same demographic as the fashion retailers. He hired Mario Lopez to present DeAnne with an award. The photos went viral, and 11,000 people wanted to join the company after that weekend.
2016 – LLR made over $70 million, and expanded to a new home office in Corona, California.
Catastrophic growth, corporate tornado.
“Helping families, blessing lives.” — Wow.
Episode 2 – Show Up
LLR created a video called “5 Ways to Finance Your Start Up Costs.” The smallest initial package was $5,000. The largest was $11,000!! Examples: Open an interest-free credit card, sell your breast milk.
LLR home office employees! I honestly wasn’t expecting these people to be interviewed, but it was AWESOME. LaShae is my FAVORITE. Worked at Macy’s originally. She met DeAnne in the hallway, she had Chanel on. She marched her to the warehouse and picked out a few pieces because she wasn’t wearing LLR! She was wearing Chanel!!
Derryl Trujillo came to LLR after working for Steve Madden, and reffing and officiating high school volleyball too. He found the ad for data entry and customer service on Craigslist. He was placed in the email department, which was the first line of defense for the company. They tried to be the filter of the building. Mark and DeAnne were seldom around the office, the window seat had to look out for their cars. The family had six Mercedes vehicles. Eight-five to ninety percent (85-90%) of the sixth floor was the family. No one had a clue to run the company of that size. “Data entry” was a Google Doc spreadsheet. Everyone kept editing it, and things would change second to second!
Creating the compensation plan on the fly.
Onboarding team – Fill out your application for LLR, and you were put into the onboarding queue. The team would call these retailers and let them know they were now a part of the family. Mark had a quota. What do you need to onboard 500 people on a Saturday?
These prospective retailers had the LuLaRoe phone number saved as “LuLaRoe – Life Changing Call.”
The number of retailers just grew and grew and grew. By 2016, there were 15,000 retailers! By the end of 2016, there were over 60,000!!
Unicorn hunting – Because you could only pick sizes and the type of clothing, you never knew what prints you were going to get! There were limited prints, too. It was nuts watching the documentary! I participated in multiple Facebook Lives when I bought LLR from three different consultants, so I understand the frenzy!
They talked about the Leadership Bonus Plan. It went from Retailer to Sponsor to Trainer to Coach to Mentor. There was a huge push to recruit and to buy. Recruiting was emphasized. Roberta purchased $78,000 worth of clothing wholesale, and made $83,000 total. And that didn’t include her business expenses. She made $65,000 in bonuses! It’s really easy to see how lucrative this was!
Social media posts were always supposed to be positive, and then attributed to LuLaRoe! DeAnne would become upset if a post didn’t have the #becauseofLuLaRoe hashtag!
And then there were the LuLaRoe cruises! You had to qualify for the cruises, which meant you had to sell $12,000 worth of clothes per month. That’s crazy! But there are/were people who qualified for 5-6 cruises!
Episode 3 – Blow Up
Mark and DeAnne would go live online. Every single Tuesday, people would tune in! There was so much idol worship and celebrity.
People started realizing that there was a lot of control. A couple of people started putting the pieces together and thinking, “Oh my God I’m in a cult.”
Enter Becca Peter. She sells washi tape online. For fun, she researches LuLaRoe online. The sales tax was strange, that was her first clue.
LuLaRoe takes advantage of these feelings that women have – They want to be great moms to their kids, but also contribute to the household. It’s the opposite of empowering.
Some of these women started involving their husbands in their LuLaRoe world. And then there’s the “retire your husband” thing. I hate that with a burning passion. It’s another control thing!! Paul said it perfectly – It’s devious and sinister! You’re trapped!
Over 80 percent of people have no one underneath them in MLMs. In 2016, 70 percent of LLR consultants made NO MONEY – ZERO.
If everything is possible, nothing is true. It’s all a farce, a fallacy. The documentary didn’t really discuss the cost-sunk fallacy, but it’s true of all MLMs.
Then there’s the gastric sleeve. DeAnne and her sister, Lynnae, were recruiting women to go to Tijuana, Mexico to get the surgery! The group chat was called “Tijuana Skinny’s.” DeAnne got the surgery and is on video where she lost 72 pounds. Courtney Harwood from North Carolina was looking into it, and ultimately decided on the weight loss balloon surgery in the U.S. – She nearly died! And then she was told that the gastric sleeve was the way to go.
Then the number of retailers went up to 90,000. And if you weren’t making money, it wasn’t the obvious over-saturation of sellers, but it was because “you weren’t working hard enough.” How demoralizing is that!?
Roberta opened a box of inventory in 2016, and realized one item was soaking wet – One pair of leggings. A couple of shipments later, there was a horrible smell from the box. When filing a return request, one of the choices was “Stinky leggings.” Seriously! They were selling moldy leggings, and there was product outside, exposed to the elements. The Mentors went to the home office, and it was met with agitation and being dismissive.
The material was changing! The leggings were arriving with holes, or ripping apart after one hour. The material itself was thinner. The company claimed that they weren’t distributing old product, but they were. The design theft was rampant. They told designers to find a print, change two things, and then voila! It’s a new print!
If you complain or criticize, then you’re the loser. It highlights so many insecurities! Negativity is a big no-no. Use the delete button! People were being scolded like children. For most of the consultants, they were used and betrayed. In my opinion, there was also abuse! There was gaslighting and love bombing.
Episode 4 – Toe Up
In June 2017, LuLaRoe changed their bonus structure. It would be based on sales rather than ordering. The checks were cut in half almost overnight.
Complaints were rolling in, and the question of whether or not LLR was a pyramid scheme kept coming up. And then there was the return policy. The company implemented a 100 percent buyback policy. Consultants would get a full refund, and there was no expiration date.
A bunch of people joined, and then a lot of people left. It was a mass exodus. LLR paid over $100 million during that time. Then they reverted back to the original policy with an additional stipulation, and leaders were not eligible for refunds.
News coverage swelled. Social media groups exploded, such as “LuLaRoe Defective.” And then a few people started talking about hiring a class-action attorney. The reason? Withholding approved refunds is illegal.
The case started as a breach of contract case because they changed the buyback policy almost overnight. They started a website called LLR Class Action. The number of people who contacted the attorney was staggering.
There have been dozen of lawsuits filed against LLR, in multiple states. They were sued for defective leggings, and then copyright infringement. The MyDyer lawsuit basically called Mark and DeAnne outright scammers – One claim is that LLR owes them $49 MILLION DOLLARS. LLR is also tied to many LLCs, in multiple states. Many of them were set up simultaneously in 2017.
Then, in January 2019, a civil lawsuit was filed by the Washington State Attorney General. It alleged that LuLaRoe was operating as a pyramid scheme.
Depositions were taken from DeAnne, Mark, Kenny Brady, and Jordan Brady. They have absolved themselves of all blame and/or responsibility. In my humble opinion, they are all fucking scammers and greedy bastards. There, I said it. All of them are awful people. Mark, especially, reminded me of both of my abusive relationships. It’s all about the money!
Resources & More Information
Have you watched LuLaRich? If so, what did you think?
If you haven’t, are you planning on watching it?
Until the next headline, Laura Beth 🙂