ABOUT

Since it launched in 1998, lululemon has always been about transformation and innovation.

Chip Wilson

At lulu fashion and function came together for the first time. Our technical fabrics and innovative designs drove a new look that transformed workout gear into stylish streetwear.  

That innovation kick-started the “streetnic” (athleisure) market, a clothing category that has since grown to about $100 billion a year in annual

Lululemon was also the first to capture the spirit of the West Coast, where it’s ski, swim, board, bike, kitesurfing and work – all in one day. In 2011, lululemon needed to push for a new context for existing. This was reflected in our approach to design, culture, and shared values. Lululemon was superior because it continued to morph out of being a commodity company.  

I the company’s single largest shareholder – and it’s biggest fan. My ongoing financial stake in lulu reflects a deep belief in the company’s potential to achieve great things on a number of fronts.  

Recently, lululemon has taken a number of important steps toward future success. It brought a strong men’s line to market. It has used the latest technology to improve customer service and online shopping. It has expanded internationally. It has launched some great new stores.  

I love what lululemon is doing to improve itself and its financial performance.

But just like the people who buy our clothing, it needs to keep pushing to the next level. It is important to remember that lululemon’s very foundation comes from the West Coast spirit, this inspiration was built into lululemon from the very beginning.  

Elevatelululemon.com is a place where I share my observations on all things to do with the company. As the founder and largest individual shareholder, I continue to take a huge interest in how and what lululemon is doing.  

My input comes from a good place. A place where transformation and innovation inspire lululemon employees and all the fabulous people who wear what they do. We are asking not for incremental change but for greatness.

Recent Thoughts

FEB 15TH, 2017

Elevate lululemon’s share price

The bus shelter ad urging lululemon to acquire Under Armour generated quite a bit of media attention across Canada. In this Bloomberg TV interview, I explain why the company’s underperforming stock price over a number of year should be generating a sense of urgency among lulu’s top management – including opportunistic acquisitions.

FEB 11TH, 2017

Lululemon buy Under Armour Now

On the surface, lululemon buying Under Armour seems like a very smart idea. Under Armour is very masculine and lululemon is feminine by original intent. Putting the two together would create a synergistic powerhouse.

Unfortunately, it could not be a synergistic marriage as the cultures are drastically different. Under Armour has a philosophy of winning at all cost and lululemon'sphilosophy is – or used to be - that everyone can win.

If today were April Fools, this would be the perfect joke.

The premise of my statement for lululemon to buy Under Armour is to demonstrate the lululemon business model is far superior to Under Armour.

Lululemon takes a technical product and makes it beautiful and understands how to deliver this directly to the consumer. 

Under Armour uses big logos and buys athletes to appear important. Their reliance on a wholesale model works to expand short-term sales, but only with thin margins. UA losses control of budget forecasting. For example, the companies Under Armour sells to - like Sports Authority - go bankrupt leaving it with receivables and inventory.

A few years ago, lululemon was worth double Under Armour. But now it is worth just marginally more.

Why has lululemon lost so much market value to a weaker competitor with a weaker product and culture? Especially given lululemon's role in bringing about the biggest change in how people have dressed in the history of the world.

Why is lululemon stock still the same price it was five or six years ago?

Is this a CEO problem?

Directors are legally accountable to the shareholders who actually own a company. They are responsible for oversight of management and operations. They are responsible for long-term vision. All these things drive shareholder value.

The board is also responsible for hiring a great CEO and to develop a pipeline of talent. But lululemon stock has actually decreased under the current CEO's three-year term.

Lululemon has an outdated, staggered board system which entrenches management and the directors who have a duty to oversee it. It is a board that would not even answer questions from the largest individual shareholder at the 2016 AGM out of fear of being taken to task.

As that shareholder and the founder of the company, I am the single most informed cheerleader for lululemon’s success. No one has a bigger financial – or personal – interest in seeing things work out well.

That’s also why I am so outspoken about the need to restore the West Coast values and vision that made thecompany a success. Sustaining that success requires more than just opening stores and tweaking existing product lines. All that untapped potential is just sitting there, waiting to be unlocked by the right team.

A strong quarter here or there is not the same as a coherent vision. Neither does it demonstrate the spark that ignites a culture and takes a company from good to great.

And let’s not forget that even the most recent quarter, which was celebrated by management, only brought the lululemon share price back to where it was three and even six years ago.

My comments may not be popular among company management and directors, but I have managed to bring about some positive change already. Under public pressure, lululemon has become more transparent about its strategy, it has pushed ahead with international expansion, it has made a few steps forward with corporate governance. These are all things I pushed for from outside the tent.

All those things are positive, but there’s still so much more to accomplish – starting with the understanding that vision is not the same thing as just opening more stores. One is about culture and values and the long-term, the other is about short-term pops in quarterly results.
Lululemon is now valued a few nickels more than Under Armour when it should be worth double. When will management and the board claim the $10 billion that has been lost?

JAN 17TH, 2017

Chip Wilson Inc Interview

I recently came across this video of an interview I did a while back with CNBC’s Tyler Mathisen. I’m sharing it because it really captures the essence of lululemon’s success: a corporate culture that is based on employees who are aligned in values and purpose. We gave the tools to take good and make it great. And they did.

DEC 9TH, 2016

Chip Wilson BNN Interview

In my interview with BNN on December 8, I applaud lululemon management for delivering another solid quarter of growth. They’ve delivered a lot of what they promised. But I also continue to push them forward towards mindful innovation and back to the West Coast values that made the company great.

DEC 9TH, 2016

Chip Wilson BA'80, in Conversation with Jim Dewald

Speaking on November 30 at my alma mater,  the University of Calgary, I had a chance to reflect on the culture that made lululemon such a success. It was always more important to me to go to work every day and be around people I loved than it was about money. I put all my money into developing the people I wanted to be with.

DEC 8TH, 2016

We can’t squander this momentum

As the co-founder of lululemon and its single largest shareholder, I’m encouraged by today’s Q3 results.  

Net revenue, gross profit and total comparable sales are all up. While quarterly results never tell the whole story, from what we see today it’s clear that lululemon is on track for success.  

lululemon has momentum, but we can’t afford to squander this incredible opportunity. All of us—lululemon’s management, employees and shareholders—need to work to push this great company further, faster.  

There’s so much more opportunity out there. It’s the right time to build on today’s success and take this transformational company to the next level. It’s time to truly elevate lululemon.

NOV 15TH, 2016

lulu + vancouver = innovation

Innovation has always been at the heart of lululemon and its success.
In 1980, when triathalons were in their infancy and the first Iron Man competitions began, no one had figured out how to make the transitional clothing that was required by the athletes. I’m always looking for solutions  to the issues at hand – so it was automatic for me to give it a shot. I really had to think about function first, but putting the seams in different places created a look that had never happened before in apparel. That’s real innovation and it was a response to Vancouver, to life here. And that’s why I passionately believe lulu needs to stay here and stay inspired to keep innovating.

NOV 7TH, 2016

West Coast: Finding inspiration in Vancouver

I’ve recently been very vocal about reviving lululemon’s direct connection to Vancouver for a very specific reason: I’m convinced that where you are creates a conversation – and an opportunity. If you’re in Hollywood, you’ll be ahead of others in the entertainment business. If you’re in Portland, it’s all about running shoes. Vancouver is at the forefront of technical apparel. Here, we live in a temperate rain forest where you can ski, snowboard, surf, swim, sail and cycle all in one day. That creates a different nuance for how we wear apparel and what we expect of it. And that’s always been integral to the success of lululemon.

SEPT 1ST, 2016

Reflections on a Solid Q2

I own a big piece of the action at lululemon. As the founder, I know the company and its employees extremely well. I also know that segment of the retail market cold.

For those reasons, I recognize and applaud what lulu has accomplished in the second quarter of this fiscal year. 

For some time, I have been openly frustrated by the gap between my strong belief in the company’s potential and its performance

In my frustration, I challenged lulu management about their vision for the future. They responded by committing to more than doubling their earnings. This has been a breakthrough for lulu – something these quarterly results clearly demonstrate.

In almost every respect, lulu is now far ahead of where it was last year at this time. And even where it was at this time last quarter. Again, I applaud the progress.

I support what management has done to increase not just revenue but-  for the first time in nine quarters - its earnings.

I’m also a big fan of the aggressive goals and the strategy they have shared, as well as the new products, stores and channels that have emerged over the last three months. The e-commerce numbers are especially noteworthy. So are the additions to the men’s line.

In a business where execution is everything, there are still some big tests ahead. 

To achieve its own growth targets, lulu management is going to have to hold its own feet to the fire in terms of ongoing innovation and transformation. I’ll be watching.

I remain hopeful that we’re going to see a convergence of values and value over time. If the company returns to the west coast values upon which it was founded, market value will inevitably follow. 

That’s what I’m going to be watching for. Because that’s how we’re going to truly elevate lulu.

AUGUST 19TH, 2016

Open Letter to lululemon Shareholders

In the past, I have been openly critical of the management and Board of lululemon.

As lulu’s founder, largest individual shareholder and greatest fan, my concern was focused on lulu’s plan to sustain long-term performance and create shareholder value.

This was never about picking a fight with lulu management. My remarks came from a constructive – if somewhat frustrated – place and were focused on several objectives.

Above all else, I wanted assurance that management saw the same tremendous potential in lulu that I do. I also wanted to know what the plan was to capitalize on that opportunity and build value through long-term growth.

All shareholders now have that insight. We know the targets and the indicators we should be looking for as the company moves forward.

My second objective was to promote a standard of corporate governance that would provide lulu with the strong foundation and guidance to sustain its growth plan in a rapidly-changing market. 

Both of these goals also have a proven, positive impact on the share value of all publicly traded companies – something that’s been demonstrated by lulu’s recent share price performance.

Since I spoke out, lulu management has been engaged, responsive and forthcoming. They have shared their strategy and I have seen the impressive new product lines and been in some of the new international locations. All very impressive.

These initiatives, along with strong innovation, must be coupled with excellent and relentless execution. I’m anxious to see lulu management follow through on these actions. As well, I’m looking for adherence to the core values that have differentiated and strengthened the company over 20 years.

One way to reinforce lulu’s values is to revive the West Coast influence that inspired and framed the company from its inception. Appointing a Vancouver-based director would be a positive step in that context.

Lulu has always been a brand and a company of limitless potential. It is more than able to withstand the high expectations that will continue to drive it toward excellence and success.