Lemonis and yet she still doesnt want to take the risk to adapt to the latest trends. Maggie i dont think i would call myself a rebel. Lemonis what would you call yourself . Maggie safe. Lemonis . Even if thats what the customers want. Woman 2 you need to be more aggressive with the style of the leggings. Maggie no. Lemonis if i cant get this owner to think creatively. Maggie i like the shape. I like how it fits the waistline. Susana its really mediocre. Maggie thank you. Lemonis . Her beloved fashion brand may go out of style forever. Honestly, i wouldnt take any of that. None of it. My name is marcus lemonis, and i risk my own money to save struggling businesses. Were not going to wake up every morning wondering if we have a job. Were going to wake up every morning wondering how many jobs we have to do. Its not always pretty. Everything is going to change everything. But i do it to save jobs, and i do it to make money. This. Lets go to work. Is the profit. The athleisure industry has exploded in the last several years, and what appeals to me about montiel is that it broke through the clutter and quickly gained a following. Its only been around since 2013, so im heading over to the companys warehouse in downtown l. A. To learn more. Hello . Hi. Maggie hi. Lemonis how are you . Maggie im good. How are you . Lemonis good. Im marcus. Maggie maggie. Nice to meet you. Lemonis maggie, nice to meet you. Kiara kiara. Yes. Lemonis kiara . Lemonis thats a cool name. Kiara thank you. Cambria cambria. Lemonis how are you . Another cool name. Everybody has got nice names. Are guys all wearing the product . Kiara yes. Maggie we are. We are. Kiara we live in it, so. Cambria i wear it, like, every single day, like, to work out in. Its just its perfect. Lemonis yeah. Athleisure is really the new denim. Maggie well, you know, once you go leggings, you dont really go back in your jeans. Lemonis are you trying to hurt my jean business . Maggie no, no, no. I wear them on the weekends. On the weekends, on the weekends, on the weekends. Lemonis do not mess up my jean business. So what exactly do you guys do . Maggie so we make womens activewear bras, panties, leggings, stuff like that. We do all the manufacturing and everything in san diego, so its all made in the usa. I use a contractor. Lemonis oh, you do . Maggie . But i order all the materials to make it, and they cut and sew it. Lemonis can i see some pieces . Maggie yeah, of course. Lemonis i want to see what the top sellers are. Cambria definitely our teardrop bra. This is our numberone seller. Lemonis this is the numberone seller in the company . Maggie yeah. Thats the one that i started with. Lemonis wow, this feels really nice. Kiara right now, i have on the reagan. Lemonis which one is that, that one . Kiara this one, in black. Lemonis what do you like about that . Kiara i think the straps. Lemonis okay. Cambria these are the lea leggings. Lemonis how much stretch is in here . Cambria theres about 5 spandex. Lemonis yeah, it does feel nice. As i look at the products that maggie makes, i would say that, from a quality standpoint, theyre superior. You put a nice grain in it. Maggie yeah, thats our special blend. Lemonis . But they seem very plain. How many different colors overall in your whole collection . Maggie 9, 10. Lemonis and what if you wanted to come up with a printed fabric or a different color . Maggie i would never do printed. I think its a little cheesy. When i think of prints and stuff like that, theyre more fad. Lemonis so who created this . Maggie me. I kind of got a little bullied with that one because everybody was doing color blocking. I dont think i would want to be seen in that. Cambria my sister loves them. Lemonis i get the sense, and im totally reaching here, that if you dont like it, it just doesnt sell. Maggie its kind of easy when its your line. You can kind of control that. Lemonis and so, how do you innovate . Maggie i do what i want, you know, kind of like what i would want to wear. Lemonis its obvious to me that maggie makes products that she likes and that fit her personality. Oh, is this your look book . Maggie yeah. Lemonis the only thing it doesnt show me is how i could use the product. And whats puzzling to me is the presentation of it. I dont see any diversity in terms of activity, not even riding a bike or jogging. The usage of the product feels a little onedimensional. If you like to do a particular activity or wear a particular color and maggie doesnt have it, its almost like shes telling you, go shop somewhere else. Who actually designs . Maggie so i do the design. What i do is, i come here in the morning. I usually arrive before them, and i get so much done before they come. Lemonis like. Maggie see, im so weird because i cant have noise. I cant work with noise at all, and i go, and i do the rest of my work from home in silence. Cambria its really weird. No, we just sit here and talk to each other all day. Lemonis let me just see if i can understand this again. You come here early in the morning when nobody is here. You work, and then as soon as humans come around. Maggie im out. Lemonis . You leave, and you go work at home where theres nobody. Maggie exactly. Lemonis maggie actually reminds me of a girl that used to sit next to me in grade school who used to always shush me. I would describe maggies personality as introverted, and theres nothing wrong with that, but if youre going to lead a business, youre going to have to somehow get out of your shell. Its directtoconsumer only. Maggie yes. Lemonis . And trunk shows . Maggie no trunk shows. And we dont do wholesale. Lemonis thats it, online, no other way to buy it . Maggie as of now, yeah. Lemonis buy it from you, or dont buy it at all. Maggie right. Well, and we did that because i wanted to offer a better price. So i wanted to charge 38 bucks for this and not 58. Lemonis right. It seems problematic to me that maggie only sees value in selling online, and while im in favor of the bulk of her revenue coming from that channel, its helpful for a business to just think differently and not think so onedimensional. What prompted you to open this . Maggie it kind of fell in my lap. My dad has been in the industry. Lemonis your dad was in this business or just in the fashion business . Maggie yeah, in the apparel business. Yeah, for 40plus years. Lemonis really . What did he do . Maggie he did ashworth golf apparel. Lemonis okay, cool. Maggie yeah. So my dad was liquidating one of his lines, and it was a ladies activewear line, but it was more towards an older demographic, so i helped him liquidate the company, and i was doing trunk shows, and i went to my dad. Im like, how can i make this bra in a ton of different colors . And thats where it started. Lemonis when did you start this . Maggie november 2013, and that was in my twobedroom apartment. Lemonis so how many team members, just the three of you . Maggie so for the office, its the three of us. Lemonis and your dad is still involved in the business . Maggie yeah. Hes our ceo. He helps. Lemonis why arent you the ceo . Maggie because i think that having somebody whos been in the business and knows what hes doing and has taken other Companies Public is really important because, at that time, i wasnt qualified to be a ceo. I wasnt qualified to be a president at the time. Lemonis on first blush, it seems like a good idea that maggie has really acquiesced the ceo title to her father, who has years of experience in this industry, but to use him as the ceo feels a little like a copout to me. And so social, who drives social . Maggie me. Lemonis you do . You do it all yourself . Maggie mmhmm. I did all of my advertising through facebook, and i got in at a really sweet spot. I had sales right away, and i had people following us, like, really fast. Lemonis i think its very smart that you did that. Maggie thank you. Lemonis it seems like a great instagram product, as well. Maggie yes, it is. Lemonis how much inventory in total . Maggie theres about 24,000 units in here. Lemonis and what does that equate to in dollars . Maggie its about 250,000. Lemonis what were you doing in cost of goods for the year . Maggie like 44 . Lemonis so how much revenue will you do . Maggie sales, we did 1. 8 million. The year before, we did 2. 1 million, so we dipped. Customers, theyre just not coming back. Lemonis do you ever change your mindset and come up with new things . Maggie i have no interest in that. Lemonis uhhuh. Maggie i feel like i have a lot of pressure on me, and lemonis where is the pressure coming from . Maggie myself. I want to be successful for my parents. I dont sleep. It was worse when i was younger. Ive kind of gotten control of the anxiety part. Well, to get it started lemonis are you happy now . Maggie no. Lemonis why not . Maggie because now im worried. Now im worried. Lemonis would you have fun, please . Maggie okay. Well, all right. Im trying. Lemonis any time i go into a business, i have to really, early on, determine what my process is going to be like with the business owner. Am i going to have to be very tough . Am i going to have to be aggressive . Am i going to have to be persuasive . In the case of maggie, giving her opportunities to try things without fear or failure or without any consequences to that failure may be a better path. Maggie told me that her father is actually the ceo, and so i thought itd be a good idea for us to meet before we sat down and had any more discussions, so were going to meet at the cutandsew factory in san diego. How are you . Im marcus. Gerry im gerry, marcus. Lemonis gerry, how are you, sir . Gerry im good. Nice to meet you. My pleasure. She wanted to get in when she was about 10 years old, and she wanted to make clothes when she grew up. Lemonis because her dad made them . Maggie yes. I was running around in ashworth as a kid, up and down, as they were sewing. It was like yeah. Lemonis can we get a tour of this place . Maggie absolutely. Gerry sure. Lemonis this place is cranking, isnt it . Gerry this is a great shop. Lemonis i mean, wow. Gerry these people have just been fabulous for us. Lemonis theyre amazing. And so once it leaves here, its bagged and tagged, right . Maggie and it comes to l. A. Lemonis im impressed with the type of capacity that is available to her at her cutandsew operation. What it tells me is that if the business explodes, were not going to have a problem on the manufacturing side. Sally hi. Maggie this is sally. Sally, marcus. She does all the patterns. So this is where we do all of our cutting. I buy my fabric. It gets shipped here, so hes holding our fabric, as well. Lemonis do you think her personality and the product are similar . Sally yes. She tones it down a little bit. Lemonis she pulls you back . Sally yes. Maggie we have different styles. We do. Lemonis i would love to see something thats, like, different. Sally well, she wants to play it safe starting out because we dont quite know our audience yet, and you want to make products that are for sure going to make it out the door. Black and white is a sure thing. Lemonis now, its clear to me that maggie and sally have put a lot of thought into the pattern, providing the right support, but remember that consumers buy with their eyes, and so if its not visually appealing, you may never get a chance to tell that story that it fits great. So it goes to the customer like this, so no branding on here at all. And this really gorgeous bar tag is on there, or do you take it off . Maggie unhunh. Lemonis they see it, and they get a warning label, nothing about montiel. Maggie not in that polybag, no. Gerry thats a good idea that youre making, though, that maybe we should print some bags. Lemonis i would almost advocate spending the money on doing a twotone bag, where theres maybe clear and then a smoky window where you can actually print on it. Itll stand out. I think the thing that people have to remember is, a good chunk of what happens online is gifting, and if i wanted to buy that gift for somebody, i would have a high expectation that it would arrive with a level of presentation that would make me feel like you put in attention to detail around everything. All right. Well get out of your hair. Thank you so much. Maggie thank you again. Lemonis how are you . Maggie good to see you. Lemonis how are you, sir . Gerry how are you doing, bud . Lemonis its good to see you. Thanks for coming out. Gerry oh, my pleasure. Maggie so im going to give you the 2017 financials. I also brought this. Lemonis you know, maggie, im old. I cant read this. Maggie i know. Gerry i didnt bring my glasses, either. Lemonis so 2016 was a little bit over 2 million in revenue. Gerry right. Lemonis it looks like it made 96,000. Gerry yes. Lemonis okay. In 2017, shows 1. 8 million of revenue, so was it a loss in 17 . Gerry no, we actually made about a quarter of a Million Dollars last year. Lemonis revenue went down pretty significantly, right . Maggie yes. Lemonis how much inventory do you have in your warehouse . Maggie about 250,000. Lemonis and how much cash in the bank . Gerry 300 grand. Lemonis remind me was there any debt in the company . Maggie nothing. No debt. Lemonis no debt. Essentially 500,000 in assets. Gerry yes. Lemonis . With a nice profitable business. So why did you guys call me . Where do you think i can help you . Maggie i want to continue to grow, and i know i cant do it alone. Theres not as many orders this month, you know, compared to what it was last year. Lemonis business is slowing down . Maggie yes. Gerry what do we need to do to increase our marketing to gain sales . Lemonis i think when you really want to take the thing from 2 million to 20 million, youre going to have to try things that, 50 of them may you have to have a stomach to be able to swallow a failure. I didnt get the sense, in our first day, that youre necessarily a risktaker. Maggie okay. Lemonis i feel like the line is a little flat. It feels very safe to me. Maggie mm. I still dont look at it as safe. I let the customers kind of lead me. Its worked. Gerry i think maybe, in the business, its a little bit of a handicap for her. Lemonis why . Gerry she doesnt want to disappoint me. Shes a little conservative in a lot of things that she does. Lemonis shed rather go straight and slow than make a left or a right turn and have it be wrong out of fear that it may disappoint you. Gerry lot of truth. Maggie theres a lot of truth to it. Lemonis i love the business because i feel like you live the business and you are the business and that your work and your social lifestyle is the product. So i want to invest 1 million in the business. Maggie a Million Dollars . Lemonis yeah. I know womens apparel pretty well. Im willing to take chances, and how i see it is, you will be the ceo of this business, not your father and not me, and in order to be the ceo, you have to be bold and a risktaker. Safe doesnt work for me because i like to throw stuff against the wall and see what sticks. Gerry right. Lemonis . Spending money on custom colors and spending money going out and doing research. I think the packaging is terrible. It doesnt feel special. Maggie it could be so much better. Lemonis theres some level of embellishment that can be done to some of the products to give it a novelty piece. I dont think that this product should be singularly focused on a yoga lifestyle. Maggie yeah. Lemonis i think its more of an active lifestyle. I would then look at contract manufacturing, really building collections for other people. Gerry perfect. Lemonis so my offer is 1 million for 60 of the business. Maggie um. So i didnt think we would have to give up as much equity, but i so value you. I would like to do something that would be under 50 equity. Lemonis um. If your business is in trouble and you need my help, log on to theprofitcasting. Com. Maggie i would like to do something so youre a small bor a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. That would be under 50 equity. Lemonis what percentage were you hoping that i was at . Maggie 40 . Lemonis um. You bring years of experience. She brings the knowledge of the industry. I want to be respectful of that, so my revised offer is 45 of the business for 700,000. Gerry what do you think, mags . Maggie absolutely. Gerry lets do it. Maggie i could not lemonis you want to do it . Maggie yeah, absolutely. Lemonis okay. Maggie that is so cool. Lemonis you ready . Maggie im so ready. Lemonis okay, congratulations. Maggie thank you so much. Thats awesome. Im so excited. Lemonis congratulations. Gerry thank you so much. Lemonis its going to be fun, man. Whats up, my man . Kenny how are you . Good to see you. Lemonis did you dress up for me . Kenny i did. Lemonis today were meeting at lua sol. Its a company that can license prints and different designs and lyrics to put on a lot of our garments. This place is pretty much the exact opposite of what maggie does. Im hoping that shes open to this idea. Putting any designs on her garments would be a huge change for her. I wanted to create a couple of capsules inside of montiel, one thats maybe maggie. Kenny yep. Lemonis actually, that would be the name of it. Kiara oh, wow. Thats so cute. Cambria so cute. Maggie its a pretty cute name. Lemonis we want it to be really representative of your personality. Maggie oh, boy. Lemonis . Which i havent seen yet, so at this point, itll be a bowl of vanilla ice cream. Maggie i dont eat ice cream. Lemonis my ultimate goal with montiel is to create three distinct lines of revenue. The first line of revenue is to continue to sell her Core Products and add embellished products using lua sol under the brand of maggie. Tshirts, other products that she has today, but something fun and different. The second line of revenue would be for maggie to collaborate with one of my other designers and companies, susana monaco, to create a whole new line for the wholesale market. The third line of revenue would be maggie creating cobranded products for specific businesses, unique just to them. Kenny this is a list to inspire where you want to land in terms of your messaging. To think about lyrics, its endless. Maggie okay, so, you may say im a dreamer, but not the only one. Eh . No, i dont think so. I found the greatest love of all inside me. No. Im just beautiful me selena gomez. Eh, no. Look at the stars. Look how they shine for you. I will be rising from the ground like a skyscraper. Interesting . Lemonis none of those you like . Maggie no. I didnt love them right off the bat. Lemonis im disappointed with the fact that maggie is not even being openminded to any of these ideas. No usually should be followed with, but what if we tried this . Or, what if we did this . Kenny are there any artists that inspire you . Cambria i think lady gaga is, like, supercool, such a strong woman. Maggie yeah, nope. Cambria nope . [ laughter ] maggie let me skip her. Juli but i think that she has a plethora of songs, i feel like, and lyrics can mean something to everybody, like, a little bit something different. So its youre pulling that emotion out rather that promoting that persons face. Maggie right. I mean, ive loved, whats her name, dua lipa . Her whole album nailed it. Lemonis