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James Rhee has faith. The kind of dogged determination that turns a struggling clothing company on the brink of bankruptcy into a profitable multimillion-dollar business.
Rhee is the CEO of Ashley Stewart, a plus-size African-American women’s fashion brand. He was just a “passive” board member until the company faced imminent liquidation in 2010. “They approached me and said they were looking for someone with experience in transformative business models,” he said during an invite-only discussion at digitalundivided’s offices in Atlanta. It turns out Rhee was just the man Ashley Stewart needed in her life.
Rhee is a husband and devoted father to three daughters. He says everything he does these days is to make his daughters’ lives better until he dies. That kind of idealistic pragmatism is what kept Rhee going, even after the company filed for bankruptcy in 2010. It kept his head up when friends ridiculed him for taking over a failing African-American clothing company. It kept him working when return on investment seemed bleak.
During the darkest days, he was selling scrap metal and begging for credit to keep operations afloat. He stayed in low-budget hotels and went six months without seeing his family.
He recounted a conversation he had with his wife. “James… you look like crap, you have three kids, what’s going on?” she asked. She knew he was drained.
But Rhee had the employees and customers behind his back. Consequently, Rhee has saved the jobs of the approximately one thousand people who now work for Ashley Stewart.
How He Did It
Rhee went before his new employees on his first day and said, “I’m probably the least qualified to take over this company.” But in fact, Rhee had the kind of background that was going to turn it around.
He studied at Harvard. It was an opportunity that he was fortunate enough to have coming from a first-generation Korean-American family in Long Island. “We brought a menorah for our first holiday season because we just didn’t know,” he remembered. “We didn’t have a lot of money flowing at our table.”
After graduation, while his friends went to McKinsey and Goldman Sachs, he went on to teach at an underperforming high school. He made $12,000 a year. “It’s the most important thing I’ve ever done,” he said.
Rhee wasn’t teaching for long, however, eventually going on to Harvard Law School. Then, he went into private equity. He was a senior investment professional at two leading, Boston-based investment firms, one specializing in growth and the other focused on distress.
Still, it was the essence of who he was that made Ashley Stewart stay alive. It goes back to when he was eight years old and he would stand up for his mom when others tried to put her down. “She didn’t grow up here or speak the language. She was an educated woman, but she didn’t always feel comfortable,” he said in an interview with the Washington Post. Ashley Stewart reminded him of his mom.
So, he stood up for Ashley when others tried to count her out. He was her friend. “Nobody’s stood up for Ashley Stewart, I’m going to be the one to stand up for Ashley Stewart,” he said. He understood what the brand meant for African-American women, customers, and employees. When investors turned him down for funding, he noted that they had no women, black women, or plus-size women on boards. So Rhee is doing things differently. He is betting on diversity. He is changing the game.
Rhee is Changing the Game
He sees the inclusion of African Americans and other women of color as fundamental in innovating consumerism in the 21st century. Retail is failing everywhere else, but Rhee is implementing a social media strategy that makes Ashley Stewart one of the most engaged fashion brands today, with 40 percent of their revenue generated online.
He said it’s all in community building and creating a loyal consumer base. “We’re not discounting our ride or die shoppers, but we’re hoping for others to see us and come play with us,” he said.
While Rhee can count fun, kindness, and emotional appeal into his successful business model, don’t get it twisted. Under his calm, nonchalant demeanor is someone who is tenacious and a bullfighter in the ring.