Despite having no formal business education, Blakely developed her first product from her apartment
In 2000, Sara Blakely was working as a door-to-door fax machine salesperson when she decided to start her own business with $5,000 from her savings. Her idea was to develop a new type of women's undergarment that would offer greater comfort and support.
However, she had no formal business training, had never attended a business class and had no outside investors. Nonetheless, she went on to establish Spanx, a company that would eventually become a major name in women's clothing.Twenty-one years later, in October 2021, global investment firm Blackstone announced an agreement to acquire a majority stake in the company at a valuation of $1.2 billion. The deal marked a major change for a business that Blakely had built without raising outside investment.According to Blackstone, Blakely would retain a significant ownership stake and continue working with the company's existing management team. She would also become Executive Chairwoman of Spanx.Alongside Blackstone, several prominent women, including Oprah Winfrey, Reese Witherspoon and Whitney Wolfe Herd, joined as investors. Their involvement brought together businesswomen who had previously supported the company or established successful companies of their own.
How Sara Blakely started with $5,000
Blakely's journey began while she was still selling fax machines door to door. She wanted to enter the women's shapewear and undergarment market, an industry that was male-dominated at the time.Despite having no formal business education, she worked on developing her first product from her apartment. She also wrote her own patent application for the undergarment she had invented.The company initially focused on shapewear, a category of clothing designed to provide support and create a smoother appearance under other garments.
Over time, it expanded beyond original undergarments into several other clothing categories.Its product range eventually included leggings, denim, trousers, activewear, swimwear and intimate apparel. The company also introduced collections such as Perfect Pants, extending its business into everyday clothing.Blakely was also included in TIME magazine's list of the world's 100 most influential people and appeared on the cover of Forbes as the youngest self-made female billionaire.
Blackstone's major investment
On October 20, 2021, Blackstone announced that funds managed by the investment firm had agreed to acquire a majority stake in Spanx. The agreement valued the entire company at $1.2 billion.
Blakely welcomed the agreement while reflecting on how the company had started. “This is a really important moment in time for female entrepreneurs,” she had said.“I started this company with no business experience and very little money, but I cared the most about the customer, and that gave me the courage to launch the company.”
Oprah Winfrey and Reese Witherspoon join
The transaction was formally completed on November 18, 2021, when Spanx and Blackstone announced the participation of several additional investors.Among them were television personality and entrepreneur Oprah Winfrey, actress and Hello Sunshine founder Reese Witherspoon, and Bumble founder Whitney Wolfe Herd. Two female-founded investment firms, G9 Ventures and Able Partners, also participated.Winfrey had played a role in bringing the company to public attention during its early years.
In 2000, she included the product in her well-known Favorite Thingsselection.Recalling her first experience with the product, Winfrey said, “When Sara first came on The Oprah Show to tell us about her idea for Spanx, I knew it was brilliant.”She added that the company had become a regular part of her wardrobe and expressed support for the company's continued development.Blakely also described the participation of Winfrey and Witherspoon as particularly meaningful because both had supported the brand for years.
What changed for Spanx after investment?
Under the agreement, Blakely retained a significant equity stake in Spanx and became its Executive Chairwoman. The existing senior management team also remained involved in overseeing daily operations.Blackstone and Spanx announced plans to establish an all-female board of directors. The Blackstone investment team responsible for the transaction was also made up entirely of women.Ann Chung, Global Head of Consumer for Blackstone Growth, said the investment would support product development, international expansion and the company's digital transformation.The transaction also formed part of Blackstone's investments in female-founded businesses, which included Bumble, Hello Sunshine and Hotwire Communications.Beyond her business career, Blakely had also committed to philanthropy. In 2013, she signed the Giving Pledge, promising to donate half her wealth to charitable causes. Through her personal foundation, she had already contributed millions of dollars towards supporting women.