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Over the years, the label M.M. LaFleur has gone beyond helping its customers look good for the officeit’s also helped them find new professional opportunities during hard times. During the pandemic, it launched a Slack channel to help customers who had been laid off find a new job. It hosts networking events so customers can get to know other women in their industry. And now, as the Trump administration lays off thousand of government employees, M.M. LaFleur is rallying the troops to provide support. The New York-based womenswear brand first realized something was amiss in January, when it saw sales dipping in its two stores in the Washington, D.C. area. These stores serve women who work in politics and government, along with the lobbyists and lawyers whose work intersects with those fields. D.C. is our second biggest market after New York, says Sarah LaFleur, the brand’s founder and CEO. We could tell that there was a lot of anxiety among our D.C. customers because of the looming job cuts. [Photo: M.M. Lafleur] The team began to think about how they could help these customers. It has already hosted a résumé review session. It has brought in authors who are experts on changing careers and building confidence. And it is hosting an event where people can get professional headshots taken for just $30. Sarah LaFleur, the brand’s founder and CEO, believes these efforts to support customers are crucial to building a lifelong relationship with them. And more broadly, she feels these efforts keep her, and her employees, passionate about their work. If you asked us to measure the ROI of these events, I don’t think we could, says LaFleur. But helping women is the reason we got into this business. Unfortunately, there are likely to be many more government job cuts, and workers in other industries are expected to lose their jobs because of the new tariffs. M.M. LaFleur’s approach offers a new model of corporate social responsibility focused on a brand’s immediate community and customers, rather than issues further afield. [Photo: M.M. LaFleur] An Unusually Intimate Approach While most brands try to cultivate relationships with their customers, they tend to do so at a distance, using social media. But from the start, M.M. LaFleur has taken a much more hands-on approach that is more common in very high-end luxury brands. M.M. LaFleur is known for creating Bento Boxes for customers, full of outfits they like. A team of stylists put these boxes together, and try to build personal, long-term relationships with their customers, helping them navigate through life changes, from new jobs to pregnancies. These stylists are at the frontlines of our business, says LaFleur. They have heard a lot of stories from D.C. customers struggling with this period of instability. [Photo: M.M. LaFleur] The brand also throws lots of store events that are centered around career development. They offer an opportunity for women to make friends and build their professional network. Over the years, customers have found jobs and met collaborators through these events and, at the end of each, M.M. LaFleur connects attendees by sharing everyone’s contact information (with their approval), so people can forge relationships outside of the brand. Indeed, this culture of intimacy has helped the company when it faced its own troubles. Last year, I reported about how M.M. LaFleur faced an an existential crisis when its lender went under and its working capital was about to dry up. In the end, a group of female investors, who happened to be customers, rallied together to invest $3 million in the company to keep it afloat. Now LaFleur wants to use the brand platform to bring together female investors for other startups in need of funding. For LaFleur, this intimacy with customers is key to building a long-term relationship. We don’t just want to be there at one point in your career when you need a new outfit, she says. We want to be there for all the twists and turns, and this means, being there for you in the difficult times as well. [Photo: M.M. LaFleur] Customers Affected by DOGE Cuts Now, there are many people facing hardships because of the Trump Adminitration’s mass layoffs. So far, more than a hundred thousand federal jobs have been cut. While these roles are spread out across the country, many are concentrated in the capital. The M.M. LaFleur team has hosted its $30 headshot event in other stores in the past, but now it seems D.C.-customers are in particular need of this support. A link to the event was posted on a resource board for job seekers in the federal government, and spots were filled within hours. Now the D.C. store is planning to offer two more of these sessions. To help attendees feel their best, there will be makeup artists on hand to provide touch-ups. And M.M. LaFleur’s stylists are there to help them put together an outfit that they feel will best represent them on their job hunt. In the past, government jobs have been fairly stable, so they’ve been in these roles for years, says Maria Costa, M.M. LaFleur’s director of brand, who has been involved in crafting these events. Now they need to apply for new jobs. It can be very emotional for them because they haven’t had to present themselves in this way for a long time. [Photo: M.M. Lafleur] M.M. LaFleur has also partnered with a local woman-owned bookshop, Old Town Books, to help program other career events. It brought on authors to talk about how to perfect your pitch at an interview, how to reduce your mental load during times of stress, and how to crack the confidence code. It also hosts résumé review events with career coaches. These are similar to events that M.M. LaFleur has done in the past. But in D.C., they have taken on a new urgency, as customers are struggling. But given that the brand has the infrastructure and experience to effectively throw these events, the in-store team can do more of these events quickly to keep up with the demand. For LaFleur, these events aren’t just good for customers and members of the community. They keep her and her team passionate about the work that they do every day. And she thinks this is valuable. We make clothes, but our mission is about much more than clothes, she says. We’re in the business of empowering women to thrive in the workplace.
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E-Commerce
When Elon Musk first drove a prototype of a Model S out from behind a curtain in 2009telling the crowd they were looking at what would become the first affordable, mass-produced electric carit was actually a hacked-together Mercedes with modified body panels. Behind the curtain, engineers pumped ice water over the battery so the car could keep going. The car wasnt ready to drive, but Tesla started taking customer deposits and using the demo to push for more investment. It’s one in a long series of examples of the company hyping a new product early because it was desperate to raise more money to keep goingand to boost the image of Musk as a visionary leader, able to build something that other car companies couldnt. Musk didnt understand the business he was getting into, says Edward Niedermeyer, author of Ludicrous: The Unvarnished Story of Tesla Motors, a 2019 book that documents the chaos at Tesla. He had to come up with a big new hyped thing to raise the money to pay off the last promise. It got them on something very common for Silicon Valley startups, the fundraising treadmill. That fueled this decade-long, spiraling sort of confidence game. Part of the game is that the stakes have to get raised every time. (Tesla didn’t respond to a request to comment for this story, but also didn’t say that the book was inaccurate when it was published.) Musks role at the so-called Department of Government Efficiency is the latest example of raising the stakes, Niedermeyer says. Elon Musk (in driver’s seat) and Tesla chief designer Franz von Holzhausen (in passenger seat) at the Model S unveiling. March, 2009. [Photo: Robyn Beck/AFP/Getty Images] Musk invested in Tesla in 2004 with money hed earned from selling two internet startups. Teslas founders, two Silicon Valley engineers, didnt have experience in the auto industry either, Niedermeyer writes. But they had the idea that using lithium-ion batteries could make electric cars viable. They also believed that by making a desirable, high-end electric sports car, they could make enough money to fund a more affordable mass-market version (Musk later presented the strategy as his own in a blog post about Tesla’s “secret master plan.”) At a shareholder meeting in 2016, Musk admitted that the startup had had no idea what we were doing. They originally planned to modify an existing sports car, which another company would build. But they kept making more and more changes, driven in part by Musks desire to make the car sexier. No one understood how much the customization would cost, or exactly how much cash the company was bleeding. The prototypes had multiple problems. When Google founders Sergey Brin and Larry Page tested one of the cars, it couldnt go more than 10 miles an hour because of a bug. When the startup was closing its Series D round of funding, in 2007, the team told investors that the Roadster would cost $65,000 to produce; auditors found that it would actually cost $200,000, far more than the price of the cars. More chaos ensued, including Musk pushing out one of the companys original founders, and engineers scrambling to bring down costs and to solve last-minute problems with the design. When the cars finally started getting delivered to customers in 2008, they still had multiple flaws. Musk, who then took over as CEO, operated on the principle that the end justified the means. He used customer deposits, for example, to keep Tesla running. At one point, he announced that the company had closed a $40 million debt round before it had actually happened; later, he said that the company was going to get a massive loan from the DOE before Tesla had successfully applied. The company kept going in part because of luck. In California, for example, the states requirement for other car companies to buy zero-emission vehicle credits gave a Tesla much-needed source of cash. (Now, it offers less revenue, because other car companies have EVs of their own and dont need to buy as many credits.) Larger car companies, including Daimler and Toyota, made deals with Tesla because they saw it as innovative. The DOE loan helped the company start a battery factory with Panasonic, and finish building the Model S, which went to market in 2012. Later, as the pandemic temporarily boosted the auto market, Tesla finally looked like it could be profitablebut that trend has turned around now as sales have dropped. All along, as the company needed more cash from investors or if Musk wanted to inflate its share price, he has hyped up new products, feeding the mythology that he’s more innovative than the rest of a stodgy auto industry. The hype for the Model S started long before the first Roadsters had ever been sold. Later came hype for the Model X, its first SUV, which the company repeatedly delayed; it too was filled with problems when it finally came to market. Musk also oversold Teslas Supercharger network, saying customers would get free charging forever and that the chargers would run on solar power. Musk suggested that if there was ever a zombie apocalypse, Tesla drivers could still keep charging. Despite the fact that running a charger fully off-grid would require a huge number of solar panels for each charger, Musk kept claiming that was the plan for years. (The free charging deal went away after the company couldnt afford it, though Cybertruck users have limited free access now.) Later, as Google made progress on its self-driving tech, Tesla said it was racing to develop autopilot tech. After a driver had a fatal crash using Autopilot, engineers said that theyd wanted to make the system safer, but Musk rejected the ideas because of cost; Musk denied this. Niedermeyer is now writing a second book focused on Teslas pivot to self-driving and AI. Teslas ‘full self-driving’ is the biggest fraud that Silicon Valley has ever seen, he says, adding that he doesnt think its ever going to happen. Now, as car sales falter because of Musks politics, investors are having to decide, OK, how much do I really believe this? Niedermeyer says. Because thats really what the valuation is coming down to as long as the core business continues to erode. (The company has also hyped robots that it initially demoed with humans in robot suits; last week, Musk again laid out his grand vision fr the Optimus robots, as he told employees to “hold onto their stock.”) Working in the Trump administration, where Musk can help control the regulators that might slow down self-driving tech, could be seen as another step in Musks confidence game. So far, it also seems to be helping some of his other businesses. SpaceX, for example, was facing fines, a lawsuit, and a complaint from multiple agencies, and Neurolink and X were facing investigations. All of those challenges could go away. As with Trump, being part of the government could also help keep Musk out of legal trouble. But as DOGE shows its incompetence, there’s also a chance that it could be where the confidence game ends. The surge in public antipathy for Musk has led to Tesla protests and dropping sales, adding to declines that were already happening in Europe and China. Tesla stock has dropped so steeply that Musk convinced Trump to stage a Tesla sales pitch at the White House. (Niedermeyer points out that this stunt was typical of Musk’s modus operandi: rather than long-term strategic marketing, Musk is flying by the seat of his pants.) If the stock price does fall far enough and fast enough, Tesla’s founder might finally lose his image as a visionary in the eyes of investors. And in an empire that was built on Musk’s “genius,” that could be disastrous.
Category:
E-Commerce
Let’s say you were spending tens of thousands of dollars to build yourself a fancy home theater. How would you go about actually watching movies in it? While you could always set up a Roku or Apple TV box to stream on, they’re not going to feel all that theatrical. Most streaming devices are too bogged down with banner ads and obnoxious upsells, and the streaming services themselves compromise on audiovisual quality for the sake of smoother streaming. Maybe what you actually need is a device that explicitly caters to videophiles with obsessively-manicured home theater setups. That’s what Kaleidescape has been trying to accomplish for the past two decades. This small companywith roughly 54 employees across its Mountain View headquarters and engineering offices in Waterloohas made a name for itself among A/V diehards with its eye-poppingly expensive video players, which combine the convenience of digital delivery with Blu-ray quality. Just as notable, though, is its unfussy movie player software, which clears away all the cruft of modern streaming platforms to focus on the films themselves. “What we’re aiming at is trying to get you to an experience that is as close to the director’s intent as you possibly can get,” says Tayloe Stansbury, Kaleidescape’s CEO and chairman. Tayloe Stansbury [Photo: Kaleidescape] The cost of near-cinema quality doesn’t come cheap, at $4,000 for Kaleidescape’s entry-level Strato V Movie Player. But believe it or not, this is the start of Kaleidescape’s attempt to move down-market, having previously charged upwards of $10,000 for its hardware (plus the cost to purchase movies at about $20 apiece). Stansbury, a former Intuit CTO who took the helm at Kaleidescape after getting hooked on the system himself, says he’s on a mission to revitalize the company and reach new audiences after years of stagnant product development. But if that’s the goal, Kaleidescape may eventually need to reckon with the streaming business models it’s spent all these years rejecting. [Photo: Kaleidescape] Hi-fi movies Unlike most TV boxes you can buy today, Kaleidescape does not work with any streaming services or come with a free catalog of ad-supported content. After setting up the Strato V, you are presented with a sparse menu system for downloading movieseither for purchase or rentaland watching them. And “downloading” is the correct term, as Kaleidescape does not believe in the vagaries of streaming. Each film takes about 10 minutes to acquire over a gigabit wired ethernet connectionno Wi-Fi allowedat which point it will play back even if the system’s offline. No other streaming platform supports that unless you’re on a mobile device. “When you play it, it’s perfect every single time,” Stansbury says. But the main differentiator is the quality of the content itself. While Kaleidescape gets the same source files from studios as every other digital movie store, it’s not in the business of seeing how much compression it can get away with. The company encodes video files at an average 65 Mbps, versus 12 Mbps to 30 Mbps for other services according to FlatpanelsHD, and it delivers lossless audio at 6 Mbps, matching or exceeding the quality of 4K Blu-ray discs with Dolby Vision and Dolby Atmos. Kaleidescape is also obsessive about finding issues in its video files through human review, and will either request updates from the studio or apply its own transcoding coding changes to address them. (Stansbury says the company’s record number of revisions for a single film is 92.) “It doesn’t matter if you’re on an inexpensive TV with no soundbar, or you’re in a million dollar theater, it will look and sound better when you feed it with high fidelity content,” he says. The result is sort of like listening to a CD instead of a lossy MP3 file: There are folks who will insist the difference is night and day, others who will never notice, and a third group that feels better on some gut level about having a pristine version either way. I probably fall into the third category. Kaleidescape loaned a Strato V to review for this story, and I made my eyes numb looking for barely-perceptible differences between Kaleidescape’s films and their 4K HDR streaming counterparts. On my Samsung QD-OLED TV, the colors in Mad Max: Fury Road seemed more natural than the on-demand version from Amazon, and maybe the audio was a little clearer, but was I just fooling myself? Hard to say. There was, however, one obvious improvement: Kaleidescape does a better job with subtitles. Its version of Parasite, for instance, used a much nicer font with no black background like Netflix’s version, and certain translated phrases made more sense (like “check WhatsApp” instead of “check the messenger”). Even more noticeable, at least to me as a longtime reviewer of streaming players, was the straightforward nature of Kaleidescape’s interface, which in a way it scratches the same simplistic itch as an iPod for music. There’s a row of recommended movie purchases at the top, a row of downloaded movies underneath, additional rows for movies-in-progress and favorites, and that’s it. The absence of distraction stands in sharp contrast to every modern streaming platform. Sometimes the sparseness can be vexing. There’s no voice searchat least not without dictating into Kaleidescape’s smartphone remote appand the infrared remote requires line-of-sight to the box. But the system has some niceties as well, like the collection of popular scenes you can jump to in each film and the integration with Lutron, which allows for home automation in response to certain video queues, such as raising the lights when the credits start rolling. Those kinds of experiences have made Kaeidescape a favorite among A/V installers, says John Sciacca, who covered Kaleidescape extensively as a contributing editor for Sound & Vision and works as a partner at an installer in South Carolina. “Everybody wants it,” Sciacca says. “You might not want to pay for it, but you would love to own it. And there’s not too many things out there that deliver that kind of an experience.” Cheating death Kaleidescape didn’t start off in the movie download business. Its first product, which launched in 2003, was a $30,000 video server that made digital copies of users’ DVDs and played them all through single menu system. Bloggers mocked the concept. (“If that’s not worth selling a kidney, we don’t know what is,” Engadget‘s Paul Miller wrote in 2006.) But Kaleidescape won over home theater enthusiasts, who marveled at how it made sense of their DVD collections. It even skipped the FBI warnings and other annoyances that DVD viewers had to sit through. “The experience was just better,” says Josh Goldman, a longtime owner who runs the independent Kaleidescape Owners Forum. “You could instantly sort and find other movies you wanted. You could find related movies to the one you just liked. You couldn’t really do that with a rack of DVDs in their cases.” But there was a problem: The DVD Copy Control Association took issue with Kaleidescape’s digital copies, which had no way of ensuring that users still owned their original DVDs and weren’t sharing them. The group sued Kaleidescape in 2005 and eventually prevailed after seven years of court battles. A settlement in 2014 allowed existing customers to keep using their systems, but barred Kaleidescape from selling any new systems with DVD ripping capabilities. The lawsuit took its toll on Kaleidescape, which also ran into manufacturing problems developing a new Blu-ray-based product around the same time. In 2016, the company almost shut down, with then-CEO Cheena Srinivasan blaming the lawsuit for “millions of dollars in legal fees and years of lost focus” before it secured an equity funding round to stay alive. Sciacca says the company’s brush with death helped accelerate its pivot toward digital distribution, which had began several years earlier. With new funding and no more legal clouds, it was able to make more deals with movie studios. “Kaleidescape was founded on disc-based importing,” he says. “The lawsuit paved the way for Kaleidescape 2.0, but also kind of put an end to Kaleidescape 1.0.” [Photo: Kaleidescape] Making moves Stansbury wound up in control of Kaleidescape for somewhat selfish reasons. He acquired his first system in 2011, on the recommendation of an A/V dealer who was overhauling his home theater. Although he fell in love with the product, he wound up getting frustrated with some gaps in the movie catalog and had some ideas on how to revamp the product line. He reached out to Kaleidescape, offering to make introductions with his contacts in Hollywood, which led to him becoming an investor in the company before taking the helm outright in 2020. “I was annoyed with some decisions that were made about product roadmaps, and I called them up to grump about those,” he says. “And eventually that developed into meeting the chairman and being asked to take over leadership of the company.” Stansbury points to a few things Kaleidescape has done since then. Beyond shipping the Strato V, the company has released new server products with higher storage capacities, and it’s made a foray into B2B with a server product for movie theaters. The idea is that exhibitors can use Kaleidescape for quick, flexible access to back-catalog films at high quality instead of arranging for delivery from studios. “What we’ve done is cranked out a whole new bunch of products,” Stansbury says. “We’ve got a whole bunch of new products I won’t talk to you about that are in the pipeline for the future, and we’ve also been steadily growing revenue and improving the financial picture for the company as well.” Sciacca, who was close with former CEO Cheena Srinivasan, says that while Srinivasan was more engineering-focused, Stansbury brings more of a business sensibility. “Tayloe, the new CEO, I think he came in with different business ideas, and infusion of capital, and, you know, ‘Fortune 500-think’ on how to run a company,” he says. (Kaleidescape declined to make its former leadership available for interviews.) Sticking to the past Back in 2016, when Kaleidescape narrowly avoided shutting down, Sciacca wrote a story for Sound & Vision wondering if home media server products could survive in the streaming age. Kaleidescape had outlasted a wave of competitorsXperinet MIRV, Sunfire Theater Grand Media Player, Leviton LEAPS, among othersbut could never truly compete with streaming’s convenience. He’s more optimistic now, but believes the price needs to come down further. “At the end of the day, if you if you want to buy and watch movies, there’s a lot of cheaper ways to do it,” he says. But going further down-market won’t be easy. Kaleidescape’s movie prices$25 for new-release films, $8 for a typical rentalis not much higher than other streaming platforms. Stansbury says Kaleidescape customers are surprisingly sensitive about movie prices, so it builds the cost of its ongoing engineering work into the hardware. He’s unsure whether Kaleidescape could adopt a subscription model that brings in ongoing revenue. “Financially, I’d love that, but that doesn’t seem to be where our customers’ heads are at,” he says. “They tend to be more of an ownership mindset.” Even so, Josh Goldman, who runs the Kaleidescpe Owner’s Forum, believes the company should move to a cloud-based system. The Strato V can only store 10 movies at a time, so customers have to either constantly re-download films or tack on another server, starting at $5,000. While his forum is more active now than it once was, he believes the number of people willing to install expensive server systems in their home is shrinking, and home internet speeds are now fast enough to keep up with Kaleidescape’s bitrates. “That’s got to be the ultimate survival plan for the company to maintain and deliver the best movie shopping, delivery, and playback experience,” he says. “It can’t be about storage in the home. It’s obviously got to go away.” Beyond just chasing lower prices, Kaleidescape faces a more existential challenge: Increasingly the content people want to watch at home can’t be bought on digital video stores. If you want to watch Severance, you need Apple TV+. If you want to watch Squid Game, you need Netflix. Those shows aren’t available on Kaleidescape at all. Stansbury says he’s had conversations with streamers about potentially selling high-fidelity versions of their streaming exclusives. And in some cases, that content is co-developed with a traditional studio, in which case it does eventually become available to purchase a year or two after release. But he also points out that Kaleidescape’s focus on movies is becoming a bigger advantage as the DVD and Blu-ray business dry up. Best Buy, Walmart, and Target have all stopped selling physical media, and fewer movies are coming out on disc in the first place. Major streaming platforms, meanwhile, don’t even offer Blu-ray quality as an option. “The only way to get that is through Kaleidescape, so it does put us in an increasingly unique position,” Stansbury says. So maybe Kaleidescape doesn’t need to adapt to the streaming world, because it’s survived this long playing a different game entirely. Whatever happens next, enthusiasts like Goldman aren’t betting against it. “Our laser disc player is gone, our VCRs are gone, even our TiVo is gone,” he says. “Everything has changed, but Kaleidescape, remarkably, has been a consistent part of our home video watching for 20 years, which really is amazing.”
Category:
E-Commerce
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