Former LuLaRoe consultant Heidi Castellani joined the company in 2014 after moving to Connecticut and becoming a new mom. She was drawn into the multilevel marketing company by the comfortable leggings and instantaneous community of women she found. Heidi shares her experience, and why after two years, and tens of thousands lost, she was done.
Former LuLaRoe consultant Heidi Castellani joined the company in 2014 after moving to Connecticut and becoming a new mom. She was drawn into the multilevel marketing company by the comfortable leggings and instantaneous community of women she found. Heidi shares her experience, and why after two years, and tens of thousands lost, she was done.
Want more of the LuLaRoe story? Stream "The Rise and Fall of LuLaRoe" documentary on discovery plus. Go to discoveryplus.com/lularoe to start your 7-day free trial today. Terms Apply.
Find episode transcript here: https://the-rise-and-fall-of-lularoe.simplecast.com/episodes/the-promise-of-lularoe
Episode 1: The Promise of LuLaRoe
THEME IN
Intro
Stephanie: Hi everyone! This is The Rise and Fall of LulaRoe. I’m your host, Stephanie McNeal and I’m a senior culture reporter at Buzzfeed News. In this podcast we are diving deep into the world of LulaRoe.
For those of you who don’t know, LulaRoe skyrocketed to success back in 2015 with its “buttery soft” leggings.
Tens of thousands of women sold them on Facebook and in their own homes as part of a billion dollar multilevel marketing scheme. But many of them say the company’s success was too good to be true. That they were actually losing money, and in 2017 former LulaRoe retailers banded together to sue the company, alleging it was a pyramid scheme.
On this show, we speak with retailers whose lives were turned upside down. We also talk to experts who can shed light on how these MLMs really work...including the red flags you should keep an eye out for.
THEME OUT
For our very first episode, we wanted to hear from someone who had been through it all. So I’m talking to former LulaRoe retailer Heidi Castellani about her experience selling for LulaRoe. Heidi tells us what made her join LulaRoe, her highest and lowest points at the company, how she ultimately got out...and what she left behind.
Let’s get into it.
Interview
Stephanie: Heidi Thank you so much for joining us!
Stephanie [00:00:23]So we're going to dive into your experience at LulaRoe, which I am so excited to hear more about. But for us to get a sense of who you are as a person, can you tell me a little bit about your life before joining LulaRoe?
Heidi [00:00:47]So I actually had a successful marketing career prior to LulaRoe, and I had also worked in the entertainment industry in Boston. And I got pregnant and my husband simultaneously had to relocate to New York City for his job. And when we moved to New York, he was like, We're not having a baby in New York City. This is not happening. We're going to move to Connecticut, to the suburbs// And here I am, a new mom in a new place. And I was pretty lonely. I was really lonely, actually.
Stephanie [00:01:37]I was going to say, that sounds very isolating.
Heidi [00:01:41]it was isolating // you know, like, you're sitting with a newborn baby that can't speak all day long when you went to being like surrounded by adults all day and you're in your adult thoughts. And you know, // it was quite a lifestyle shift for me.
Stephanie [00:02:51]Do you remember the first time you heard about LulaRoe and where were you and what was the circumstance?
Heidi [00:03:00]Sure. So the first time that I heard of LulaRoe was actually in a Facebook mom group. //The mom that invited me was a mom that I had connected with in California that was in this online mom group as well. And she just kept saying the leggings, the leggings, the leggings, they're so buttery soft you're never, ever going to feel anything else like this. And like, especially after having a baby like you have to at least fork over the 25 bucks for a pair of leggings and you'll be hooked. And I was like, All right, fine, I'll see what it's all about, you know? And yeah, she invited me to her virtual leggings party. // I want to say that that was at the end of 2014. //
Stephanie [00:05:28]// I have to say I've never been to a virtual party on Facebook, so I would love if you could describe it for me
Heidi: [00:05:38] (laughs) Sure, So basically, you know, you're in a Facebook group and along with the items for sale that she's posting pictures of that you can comment sold on. She's also posting really funny memes. She's posting surveys to get you to interact and everyone's interacting. People are laughing. People are saying funny things giving funny answers. And then, you know, like, there's banter back and forth. And it was just like a really fun environment //And just the interactions with the women, even though it wasn't my community that I was living in, it was just a breath of fresh air. I realized like I was so desperately missing having a female network of my own.
Stephanie [00:02:17]Especially going from a corporate career to being a stay at home mom, I feel like that's jarring for so many women and then adding in having to move and be a completely new place. //
Heidi [00:08:02]Absolutely. And all the while, you know, I'm in the group and I'm just watching people interact and comment sold, sold, sold on different items of clothing. And so of course, I'm watching it all go down as well. And because I have a marketing background, I'm like, Hmm, this is interesting. (laughs) // it piqued my interest, for sure.
Stephanie [00:08:47]//So did you buy something at the party?
Heidi [00:08:50]Oh, yes, I did. I bought a pair of leggings with horses all over them.
Stephanie [00:08:59]Are you a horse girl?
Heidi [00:09:02]I'm not a horse girl (laughs).
Stephanie [00:09:05]Just had to ask
Heidi [00:09:07]I don't know what attracted me to them. I think I wore them with some tall brown riding boots at the time.
Stephanie [00:09:15]Perfect.
Heidi [00:09:18]So and I also bought a randy tee with dachsund dogs all over it.
Stephanie [00:09:26]Oh my god, I mean, the dogs and the horses. That's a that's a Lula outfit, right there.
Heidi [00:09:33](laughs) it was its own Lula's suit, and I didn't even know it at the time.
Stephanie [00:09:38] so do you remember when you got the leggings? Did they live up to the hype?
Heidi [00:09:44]Oh, for me, they definitely did. //They were buttery soft and they felt amazing. They looked amazing. Or so I thought (laughs) and I was hooked. Honestly, I was like, I can wear these to bed. I can wear these everywhere (laughs). //
Stephanie [00:13:29] Did you know anything about MLMs at the time? And did you know LulaRoe was an MLM?
Heidi [00:13:37]So I didn't know too much about MLMs, in the past I had been invited to stuff like pampered chef parties and Mary Kay. But my knowledge of MLMs was. I didn't really know. I didn't know, and I I certainly didn't understand that LulaRoe was an MLM. // And I feel really, naive and almost stupid saying that now, you know, I'm like, gosh, I really didn't do my due diligence at the time.
Stephanie [00:14:17] I mean, LulaRoe did look very different than a pampered chef or a Mary Kay. // It was selling clothing. It was, you know, primarily virtual. // Did you have any opinion of people who joined MLMs before you got into LuLaRoe?
Heidi [00:14:44]Oh, definitely. // I think that, you know, when I became a mom in 2014, at that time, what was really popular was the makeup brand unique.
Stephanie [00:14:58]Mm-Hmm. Yes.
Heidi [00:14:59]And so that was kind of the extent of my MLM knowledge at the time. //And I just would watch them in the Facebook mom group, recruiting other moms for unique. And I just like, Oh God, that'll never be me (laughs). I'll never get involved in one of those. //
Stephanie [00:11:13]So what did you do after attending that first party, getting your first pieces of LulaRoe? Did you join groups or how did your descent into the lularoe community begin?
Heidi [00:11:26] After that first party, I wore the clothes. I liked them and I talked to my other friends that bought things. They liked the stuff, too. And // So I’d start talking to the consultant in California that I bought my first item from. But then I think she's on the other coast. If I need something different time zones, I don't think that'll work. And then simultaneously, as I'm asking her questions that same week, I got a message from a LulaRoe boutique owner in Maryland that I had bought several items from. And she just said, you know, she just checked in with me. She was super friendly. Hey, how's everything going? I wanted to see how you liked everything that you bought. And we were just chit chatting over Facebook Messenger. And then she said, By the way, you love this stuff so much. I don't know why you don't consider selling it. I never thought I would be, but it's been one of the best decisions I've ever made. And she just left it at that.
Stephanie [00:18:50]that's a pretty good sales pitch.
Heidi [00:18:52]// it was slick. And so I'm like, Hmm, OK. And then she just kept the banter going. She was really good at that, and that's who I ended up joining under. // And she was sort of like from the time I expressed interest to her through messenger, she was really, really quick to get me all of the info that I needed to look over. You know, she emailed it to me within the hour to review.
Stephanie [00:19:39]she was hard selling you.
Heidi [00:19:41]She was. She was. Yeah. //
Stephanie [00:20:02]So a lot of LuLaRoe retailers do this thing where they share their why for joining LulaRoe. So if I could ask you what was your why?
Heidi [00:20:17] I mean, at the time, my why for joining was to help empower other women. // Ithought, OK, I can sell stuff, make money and empower women at the same time. Plus, this is super convenient. With my mom schedule, I'm able to prioritize my child and still make some money for myself and not be totally dependent on my husband.
Stephanie [00:21:12] it makes a lot of sense because you were not working outside of the home at the time, correct?
Heidi [00:21:19]That's correct. I had an office job where I worked anywhere from 40 to 50 hours a week prior to having children, and I knew that that just wasn't going to fly with mom life. And so if I wanted to have, you know, some sort of independence, I had to be a little more creative. And LulaRoe certainly offered that at first.
Stephanie [00:21:44] // when you reflect on that period. What do you think was the main reason you were like, I'm going to try this out?
Heidi [00:22:02]it definitely was the community first. //once I bought into LulaRoe I, it was plug and play. I had an instant network of fabulous women.
Stephanie [00:22:29]And that's so powerful, especially, I think anyone would really love having a ready made group of friends given to them, but especially in the circumstances that you were in.
Heidi [00:22:41]Absolutely. I was lonely at the time and this changed so much for me. //
Stephanie [00:25:58]Do you remember approximately how much your initial investment was?
Heidi [00:26:02] my initial investment was a little over $7000.
Stephanie [00:26:07]Wow. Mm hmm.
Stephanie [00:26:10]Do you remember any memorable prints or items that you got in your first box? Were there any where you were like, these suck, or are there any where you were like, Wow, this is good?
Heidi [00:26:23]You know, so in my initial shipment, what I will say is that of the leggings I got in my initial shipment, they definitely dangled some so-called unicorn prints. // for the leggings. As far as the clothing items, though, the shirts and dresses and skirts. I was completely flooded and overwhelmed with geometric patterns. There was not a geometric pattern I didn't get in my initial shipment. And they did things like you would get, Oh, we're out of size, small or medium, which are really common sizes, you know, so we're just going to send you twenty three XLs. //
Stephanie [00:27:48]For those who may not know what a unicorn print in LulaRoe is, can you describe what that means in the LulaRoe community? And do you remember which unicorns they were?
Heidi [00:28:01]// a unicorn print is highly sought after. Typically, it's hard to find everybody wants it. When LuluRoe did their collaboration with Disney, I remember that there was a certain print of legging with Cinderella's Castle on it. And people lost their minds, they like lost their ever living minds over the Cinderella Castle leggings (laughs). So that was one of the prints. Anything with actual unicorns on it was typically a unicorn. There were donuts that people went crazy for. There were octopus that people went nuts for. The list goes on. //
Stephanie [00:29:37]So that first day //you're coming off this huge rush. What did you do next and how were those first weeks and months in your Lularoe business?
Heidi [00:29:51] //So two weeks into my own journey with selling LulaRoe. Somebody already wanted to join my team. I was like, what? I didn't even think I was going to have a team. I just thought I was selling and going at my own pace. But then this woman approaches me and I'm like, Well, geez, you know, why would I refuse to build a team? When she's approaching me and clearly wants to do this with me, she lived in the next town over and I think we had mutual friends. // She saw how much I was selling. She was in the Facebook group and and was watching all the sold comments. And so that's how that happened. And then from my first team member, I mean, it was just a snowball effect as far as me building a team. //
Stephanie [00:33:19]So you eventually got to the level of coach for LulaRoe. So for those listening, what does that mean? How big was your team? How big was your Facebook group and. What kind of privileges or perks did you get with that title?
Heidi [00:33:40]Sure. //So I was actually one of the first three retailers in the state of Connecticut for LulaRoe and I became a coach in 11 months. // And after almost two years in LulaRoe, I had about one hundred and twenty women on my team.//
Stephanie [00:34:39]How many hours a day where you running your business by the time you reach the coach level and had a big team under you? And was it primarily managing your team? Was it selling?
Heidi [00:34:50] // it was nonstop. I mean, women on my team would be texting me about issues, you know, 3:00 a.m., 5:00 a.m. I mean, all hours, just all hours with issues //
Stephanie [00:37:38] // Were you making a lot of money during, let's say, your top years at Lula Roe? Did you make your investment back? What was the in and out of your income?
Heidi[00:37:56] I made my initial investment back in. I think it took me three or four weeks. So, yeah, it happened pretty quickly, and that was certainly a selling point that I used in my recruitment. You know, I went full throttle with this for a month and look what I did. I was able to make my initial investment back. And then, you know, as I became a coach my monthly bonus checks were the average that I earned was usually around $6000. The highest that I earned was just shy of $10000
Stephanie [00:38:44]and This is a month, right?
Heidi [00:38:47]This is a month.
Stephanie [00:38:48]Which is a pretty good income.
Heidi [00:38:50] And that's just your bonus check. That's not what you're making by selling your inventory that is just for training and supporting your team. That's what that that bonus check is for. But then I'm seeing, you know, I'm receiving this bonus check and then I'm I'm thinking, I'm making so much more with this bonus check than I am selling the actual clothes. So then, yeah, my my energy's did shift into the team management aspect and recruitment.
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Audio Cue for Ad Break
Stephanie [00:39:26] // let's think about your high point of Lularoe. //What do you remember about the community and what you were getting out of the community? And do you have a high point? A cruise, a convention that you were like This is the best.
Heidi [00:43:24] it's funny. You know, I think that my high point was also my low point. And I can explain that my high point was certainly being three months into Lularoe and becoming a trainer and being invited to my first leadership only three months in. And your first leadership is it's only the leaders. You're only with the top tier moneymakers in LulaRoe it's not like the convention where everyone shows up. So you have more access // to top sellers like Lindsay Wheeler. You know you can walk right up to her and start talking to her. And so that was a high for me being three months in and achieving that, which it took my own sponsor to become a trainer. I think she told me it took her a year. So achieving that in just three months, it was amazing, so I fly out to California for this convention and then I meet the Stidhams and all of the other LulaRoe retailers. And I was like, Oh, I don't know about all this.
Stephanie: And just for our listeners, Deanne and Mark Stidham are the husband and wife who founded LulaRoe
Heidi: right
Heidi: My very first leadership there, I think it was in Pasadena and they had a a concert that they had like an opening event at the bowl there in Pasadena. And the performers for the concert there. And now everybody's heard about Katy Perry and Kelly Clarkson. Well, we had Deanne's three or four nieces singing hymns.
Stephanie [00:45:29]That's not quite Katy Perry
Heidi [00:45:32]it's not quite Katy Perry no. So that was in 2015, and that's that was the entertainment we received. So we're all sitting on the grass lawn and I am looking to the ladies next to me and I'm like, Are we really singing about Jesus right now? What is happening? (laughs) // so, yeah, my high point was also my low point because it was the realization of what the actual f did I get involved with?
Stephanie [00:46:23]It's not your typical corporate leadership retreat. Not a lot of Jesus usually.
Heidi [00:46:29]Nope, there's usually no Jesus.
Stephanie [00:46:35]So what was going through your head at that moment, were you? Did you have a minute of, oh gosh, did I make a huge mistake or was it just, Oh, this is new?
Heidi [00:46:47]Nope. Having grown up in um in a religious environment // my red flags went up actually for real. I was like, What the hell have I done? But I was already in it. I built a team, so I was like, You know what? We're just going to consider this a minor infraction.
Stephanie [00:47:15]So you said that your first impression of seeing Deanne and the Stidham family made you feel a little. What is going on here? So I need to know more details about that. //
Heidi [00:47:28]Deanne is larger than life in person. // And then her husband, Mark, is sort of just like this. Puppy dog that shuffles along behind her doesn't say much, but then when he does open his mouth, it's like loud and Donald Trumpesque. And I was just like, Oh shit. I'm in a cult. //
Stephanie: you said Deanne was larger than life - Can you describe what you mean by that?
Heidi [00:52:05] I mean, she has a really loud voice. She's very boisterous. She has this big, huge Texas blond hair and and everything like no matter what time of the day it is, it could be five in the morning or one a.m. and she's like, Hiii everybody. You know,.
Stephanie [00:52:31]That actually was a really good impression of her.
Heidi [00:52:36](laughs)Well, I certainly had to hear her voice long enough. (laughs) So
Stephanie: I'm I'm impressed and a little creeped out
Heidi: Thank you
Heidi [00:52:47] and her eyes were always like, everything was always so big and exciting, you know? And that was how Deanne was. And then Mark was her more quiet sidekick. He, you know, Deanne was the fluff and the feelings, and Mark was the business, and I sort of pull you up by your bootstraps type personality.
Heidi [00:53:21]OK, so you're in LulaRoe. You go to this convention, you feel a little weird about it, but you keep selling, you build this big team. You now you're a coach. What was the moment where you started to reconsider your involvement with the company?
Heidi [00:53:42] when to begin to reconsider. Was my first convention that I attended. When I saw how many retailers and that wasn't even all of them, not everyone shows up. And I saw the amount, and then I saw that they couldn't feed everyone and how poorly organized the event was. But yet that we had to pay three hundred and fifty dollars of our own money to be there. We had to pay for our airfare, our hotel accommodations, everything. // and then they pull all of this, you know, we're going to launch a new product. And so then you're placing orders and spending more money while you're there. And then they opened up this pop up shop, the supply store. And you're buying more product in there. //
Stephanie [00:55:04]And what year was this? How long have you been in LulaRoe at this point?
Heidi [00:55:07]I want to say this was now 2016, so I'm in it for a year now.
Stephanie [00:55:11]What were the events at the convention and what was that convention like? I know you said it was a bit chaotic, but what are the things that you do there? Did you have friends there?
Heidi [00:55:24]I did. A lot of my team members showed up. So it was the first time that I got to hang out with some of my team members from California and from other states outside of Connecticut.[1][2][3] it was really amazing. I got to bond with these women and, you know, we got to. Do stuff go out to dinner together, we go to outfit plan and put on our makeup together and blast music in the hotel room and, got to forget that we were a bunch of moms for a moment. So it was a really, beautiful thing, but simultaneously,like I said, the poor organization. By Lula Roe was just so evident //
Stephanie [00:56:51]What were some aspects of the event that were poorly organized?
Heidi [00:56:55]There wasn't enough food for people, they ran out of products and we were in the stifling California sun and heat with no tents like out just standing in a parking lot for hours in line, waiting and waiting. // It was a mess. //and then on top of it, paying to be there? Gross.
Stephanie [00:57:27]So you got back and // what was what was the moment that you were like, I really need to start getting out of this? And were you still making money at that point?
Heidi [00:57:41]so at that point I was making money, but that was that really was the turning point a year in. When I started to focus on my bonus check vs. selling inventory. And it also became much more demanding because my team was just growing and growing. So. //I was still like, // I'm going to stick with this as long as I can. And then when I got pregnant with my second child, that was the point at which I said, You know what? I'm not doing this anymore. No way. //
Stephanie [01:02:27]So how did you go about actually quitting?
Heidi [01:02:31] // it was 2017. They announced their buyback program and I thought, OK, that that's that's great. I'm going to utilize that if I need to //
Stephanie [01:03:06] For those who don't know what was the buyback program?
Heidi [01:03:09]So the buyback[4][5] program was a program that LulaRoe developed to deal with people that had any apprehension of making this huge investment and losing all of their money, they said, Look, if you start to sell these clothes and you feel like you're not making money, you can box it all up. You can send it back to us. We have no expiration date on this offer and we will give you a 100 percent refund. And we're glad you gave us a try. And so I am pregnant and my baby is due in November. So in August, I decide that I'm going to pack all of my inventory up //in the end, I boxed up 31 boxes of inventory and these are big, huge boxes we're talking. And that was thirty four thousand dollars //
Stephanie [01:04:22]That's a lot.
Heidi [01:04:24]That's a lot of clothes. That's a lot of LulaRoe polyester.
Stephanie [01:04:29]Where did you put all these in your house? I'm just curious.
Heidi [01:04:32]So I actually had a basement, a finished basement that I turned into a boutique. I was fortunate enough to have that extra space, but I had a lot of women on my team that made their dining rooms, their boutique. So I boxed it all up and did all of the necessary things I needed to do to start the process of the buyback // I sent my resignation on September 3rd of twenty seventeen. And then I waited. And on September 13th, I believe it was, they announced the end of the buyback program without any warning.
Stephanie [01:06:34] // What was that moment like for you?
Heidi [01:06:49]I mean, here I am with this big pregnant belly and all these huge, heavy boxes. And I'm like, you have got to be kidding me. // I mean, people went crazy. People went insane over this. No, absolutely no announcement. And at first I thought, This isn't real. // like how can they do this? Like, what legal leg can they stand on //And it turns out LulaRoe can do whatever the hell they want.
Stephanie [01:08:55] // How did you feel in that moment?
Heidi [01:09:07]I had an extreme rush of anger. I definitely cried about it because I was so stressed. What the hell am I going to do with 31 boxes of ugly ass polyester? I mean, some of those prints that I packed up to send back had come in my initial my initial inventory purchase. I still had prints from my initial order. That's insane // I was screwed. Either way, I was going to lose my money. Whether I donated it, sent it all back to them. Either way, I was going to lose.
Stephanie [01:10:28]So what did you do?
Heidi [01:10:30]So I donated all of it, and I took the tax write off.
Stephanie [01:10:35]So how much money do you feel like you lost approximately?
Heidi [01:10:41]You know, the total of the actual inventory was thirty four thousand. And, you know, you tack on all of the the equipment that you purchase, the hangers, the racks, the the label, the label printer and all of the packaging and all of your marketing collateral that you, you know you had made. I don't know. I think that I probably lost around 50 grand, maybe more. // And then why don't we just tack on my six therapy sessions in 2019 to unpack my LulaRoe experience? (laughs) You know, because come to find out there was a lot of gaslighting that was involved in that environment. And you know, once I left, I realized that I did need some therapy to move past it.
Stephanie[01:11:54] //You said that you felt like some trepidation and fears about leaving Lula Roe and you talked about feeling gaslit. What were you afraid of? //
Heidi [01:12:20]I knew that it was going to be sort of like when you leave a cult // I had people that immediately stopped speaking to me when I left // they cut me off, you know, deleted me on Facebook. Um some people went as far as blocking me and like for what? // like just because I don't want to sell leggings with you anymore? Like, what the hell? This isn't just like a clothing company then if if we're blocking unfollowing and, you know, whatever else. And to say, like, that's scary. You know, looking back now that I'm forty one years old, I'm like, Gosh, you know, like then those were never real friendships to begin with. But at the time, I was so invested because I didn't have a local network of my own. This was this really was my, you know, it was my community in so many ways. And so, yeah, and knowing that friendships and bonds would end. It was scary to me, sadly.
Stephanie: we’re going to hear more about how Heidi rebuilt her life after leaving LulaRoe later in the series. For Heidi - like many who left LulaRoe - bouncing back was not easy. She had to build back family relationships… and understand patterns of abuse like gaslighting and lovebombing - both of which she says happened to her while at LulaRoe.
Thanks for listening.
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OUTRO
The Rise and Fall of LulaRoe is a Discovery Plus podcast.
From Discovery, our executive producer is Michael DiSalvo [Deh-Sall-vo]. From Buzzfeed, our executive producer is Karolina Waclawiak [Vahts-LAH-vee-ACK].
Special thanks to Shelley Sinha [Sin-Ha] at Discovery, Samantha Henig and Richard Alan Reid at Buzzfeed, and Pete Ross at Left/Right.
Our show is produced by Neon Hum Media. Jonathan Hirsch and Shara Morris are the executive producers. Our lead producer is Muna Danish. Associate Producer is Rufaro Faith. Our production manager is Samantha Allison. Sound design and engineering from Mark Bush. Our theme music is from Epidemic Sound.
See you next week!
*note for mark* I think some breathing / background noise here - can it be minimized?
im still hearing the background noise - is it not possible to minimize any more? @markbushmusic@gmail.com
its chair noise baked into the sound I don't t think I can do much more with it
maybe a door slam in background? possible to minimze? @markbushmusic@gmail.com
its pretty baked in here I cant splice anything together it sounds too frankenbite. This was the best i could do with it.