Ever wondered how much the most popular shapewear brand is worth? According to a report by Forbes, Spanx was worth approximately $1.2 billion in 2021. The company has grown over the years since Sara Blakely founded it in Atlanta, GA in the year 2000.
It currently brings in average annual revenue of $400 million from its 750 employees. Spanx is always inventing new intimate apparel for women and this keeps them on top of the game. Their products are sold in over 60 countries around the world making them one of the most popular brands globally.
History of Spanx
The brand name “Spanx” is popular all over the world. The company has grown from Blakely’s apartment in 1999 to over 12,000 departmental stores, boutiques, or online shops in over 60 countries in 2014. You will hear most people refer to normal shapewear as Spanx because the brand name has stuck over the years. However, Spanx did not start as the big brand that we know today.
Sarah Blakely, the owner was a fax machine salesperson for seven years. However, she always knew that she wanted to do something that would help women. The idea of Spanx was born when Blakely created footless pantyhose by cutting the legs in her pantyhose. She immediately knew that she wanted to make women feel good about themselves by creating comfortable shaping undergarments.
After she discovered footless pantyhose, she became obsessed with the idea and saw a business opportunity. However, she did not rush the process. From the time she conceived the idea in 1998 to the product launch, it took about two years.
During the two years, Blakely was doing research and testing because she was determined to create a high-quality product that would stand the test of time. Once she was satisfied, she applied for a patent and started the Spanx Company with the $5,000 she had as her savings.
The name Spanx came from the word Spanks. Blakely simply replaced the letters “ks” with “x”. She was looking for a name that would be easy to patent and register. During her research, she discovered that it was easy to patent modified names.
Sarah Blakely Becomes the Youngest Self-Made Female Billionaire
How did a fax machine salesperson become a billionaire? In 2012, aged only 41 years, Sara Blakely became the youngest self-made female billionaire in the US. It took 12 years of growing her business and company before earning her spot in Forbes magazine as a self-made female entrepreneur.
After gaining billionaire status, Blakely made several appearances on the show Shark Tank as a guest investor in 2017 and 2018. Apart from being a self-made billionaire, Blakely is also a philanthropist. She committed to donating at least half of her wealth to charity after signing the giving pledge.
Her billionaire status was elevated once again in 2021 when she sold the majority of her shares in Spanx to private equity giant Blackstone.
Spanx’s Loss of Net worth Due To the Covid-19 Pandemic and Competition
The Covid-19 pandemic was tough on every business and Spanx was not spared. Although the company was valued at $1.2 billion, it is believed that the true worth of the company dropped to a little above $750 million. The pandemic did not just affect the company’s net worth. Blakely’s net worth also took a hit during the pandemic.
Competition has also been a major challenge to Spanx. The brand is already established but its prices are still a little bit high. We now have other upcoming brands mass producing the same product at a cheaper price. However, there are still customers who believe in the brand due to its reputation and the fact that they have been in the business for many years.
In addition, as shapewear becomes more socially acceptable, the shapewear business has become more competitive, with the recent rise of strong brands such as Skims by Kim Kardashians, HanesBrands, and Shapermint.
How much is Spanx Worth? Blackstone Buys a Majority Stake in Spanx in 2021, Revaluing it at $1.2 Billion
Finally, after 20 years of growing Spanx, Blakely decided to sell the majority of her shares in the company. According to her, she just knew it was the right moment. In October 2021, she signed a lucrative deal with Blackstone which elevated her back to billionaire status.
When asked why she chose Blackstone over other investors, she said that she was following her gut. She had been working with a team of women at Blackstone Growth and they helped her company grow to what it is today. The best news is that she shared the success of the sale with all her employees. Every employee got two first-class plane tickets to anywhere in the world and $10,000 in cash for a vacation.
In the spirit of women empowerment, the company plans to work with an all-women board of directors. Even after selling a majority of shares in the company, Blakely still maintains a huge grip on the company and will still be in charge of operations.
The Spanx by Sara Blakely Foundation Supports Women Entrepreneurs
As you know by now, Blakely is passionate about helping and working with women. When starting as an entrepreneur, she was rejected a lot when seeking funding. At some point, she decided to carry her “lucky red backpack” that she had used in college hoping to get good luck in business. After she became successful, she decided to carry the bag even when her friends told her to buy a Prada bag. Blakely says the bag is a sign of resilience.
During the Covid 19 period, the foundation was instrumental in supporting women-owned businesses. Through The Red Backpack Fund, the foundation donated a total of $5 million to female entrepreneurs (1,000 grants of $5,000 each). Apart from helping women entrepreneurs, the fund has been helping underserved women and girls since its inception in 2013.
Since stumbling upon the idea of a figure-shaping undergarment and taking a deep plunge into the world of business, Sara Blakely has had a fair share of entrepreneurial challenges. She had to bootstrap the Spanx shapewear business but she became the youngest self-made billionaire in 2012. Only to face a slowdown in business occasioned by the Covid 19 pandemic in 2020 and later increased competition from new brands which vied for shapewear business.
But Spanx rose back to a market value of $1.2 billion in 2021 after Blakely sold majority shareholding to investment firm Blackstone. It can thus be said that Spanx is currently worth $1.2 billion.