Founder of Bebe
Addresses: Office—Bebe Stores Inc., 400 Valley Dr., Brisbane, CA 94005.
O wner-operator of a chain of San Francisco-area steakhouses, early 1970s; opened first women’s clothing store, Caspian Corner, San Francisco, 1976, followed by second, called “bebe,” 1977; took Bebe Stores, Inc. public with an initial public offering (IPO) of stock, 1998.
Awards: San Francisco State University Alumnus of the Year, 2005.
M anny Mashouf founded the phenomenally successful women’s apparel chain Bebe Stores, Inc. back in 1976 with a single San Francisco boutique. Over the next three decades, the company grew into a powerhouse with a presence in nearly every major American mall or shopping district, and its lowercase “bebe” logo on T-shirts became a ubiquitous must-have for a certain demographic of fashionable young women. “Financial success is the reward for excellence,” Mashouf said of his business strategy in an interview with Kristin Young in WWD. “We need to keep giving Bebe customers what they get excited about every day of the week.”
Mashouf was born in Iran in the late 1930s, and spent his earliest years in its capital city, Tehran, where his first shopping experiences came when he accompanied his older sister on her clothes-buying jaunts. The family emigrated to the United States, and Mashouf eventually earned a degree in political science from San Francisco State University in 1966. Over the next decade, he opened a steakhouse that expanded to three more locations in the San Francisco area, but came upon an empty storefront on Polk Street in the city one day in 1976, and decided it would be an ideal place to start the clothing business he had been thinking of launching. “My first inclination was to make men’s clothing in the basement of the store,” he recalled in an interview with Joanna Ramey in WWD. “I bought three machines, hired a master tailor and patternmaker. Then I realized by the time I’d make enough clothing to fill the store, it would be out of fashion.”
Instead Mashouf decided to sell clothing lines from established brands such as Esprit while also offering goods from a house label. With both, he hoped to tap into an as-yet-underserved niche market somewhere between teen and mature, aiming to lure the young, single woman with a good job who sought out apparel that made her “look vivacious, sexy, but not junior and cheap,” he explained to Ramey in the WWD article. The original name of his store was Caspian Corner but Mashouf decided to call a second store he opened on Union Street in 1977 “Bebe,” which he borrowed from the famous soliloquy in Shakespeare’s Hamlet: “to be or not to be.”
In 1990, Mashouf came up with a novel way of boosting his company’s profile by offering to give free clothes to aspiring young actors in exchange for appearing in ads for Bebe Stores. Charlize Theron was an early recruit, and the strategy worked out well for both parties. “They liked the clothes and they liked the exposure,” he said in a 1999 interview that appeared on Forbes.com. With eight Bebe stores in California by 1991 and total sales of $8 million annually, Mashouf announced an ambitious expansion plan that set the goal of 20 new Bebe stores across the United States by 1993, which it met and then surpassed.
Bebe’s Hollywood connections helped Mashouf land an invaluable promotional opportunity when wardrobe associates for the top-rated FOX television show Melrose Place began using Bebe outfits to costume the show’s star, Heather Locklear, in her role as a vixenish villain/advertising executive on the campy cult-favorite series. Locklear’s Amanda Burns committed her most heinous interpersonal crimes wearing tight, form-fitting miniskirted business suits in eye-catching colors. Similar successes in costuming Calista Flockhart in Ally McBeal and Sarah Michelle Gellar in Buffy the Vampire Slayer further boosted profits for Bebe, but Mashouf was adamant there were no more free clothes giveaways to starlets—though some names did receive store discounts. “If the merchandise is good enough, it should be paid for,” he said in the Forbes.com interview.
In June of 1998, Mashouf took his company public with an initial public offering (IPO) of stock on the National Association of Securities Dealers Automated Quotations (NASDAQ) that raised several million dollars and served to underwrite the opening of more stores as well as lucrative footwear, eyewear, swimwear, and fragrance licensing agreements. By 2000, there were 135 Bebe stores, and plans continued to open 25 to 35 new addresses every year. Sales flattened for the next few years in a recession period, but the company continued to be a dominant player in the women’s contemporary sector of mass-market retailing. In 2006, with 228 Bebe stores, Mashouf presided over an empire whose growth had put his family at the No. 242 spot on Forbes magazine’s annual “400 Richest Americans” list, with a net worth estimated at $1.5 billion. By then Bebe had branched out into a limited-edition luxury line that debuted on the run-way during the Los Angeles Fashion Week 2006 as Collection Bebe, and had opened a freestanding accessories store called “Neda by Bebe.”
The new division’s name came from Mashouf’s wife and business partner, Neda, whom he met in 1984 when she came into one of his stores to make a lay-away payment on a leather coat. She was several years his junior, but also of Iranian heritage and at the time enrolled at San Francisco State University as a computer science major. Neda Mashouf went from being the Bebe target customer to a designer of much of its house label, and together she and her husband came to own 73 percent of the company’s stock. In 2005, the Mashoufs gave their alma mater the largest private individual donation in the history of San Francisco State University, bestowing $10 million for a new College of CreativeArts building and performance venue that would bear the family name when completed in 2012. Mashouf’s son, Karim, was also a graduate of the school, and went to work as a Bebe executive. Commenting on the wealth accrued from his immensely successful business, Mashouf told WWD’s Ramey that “it hasn’t changed me and I don’t think money will ever change me, no matter how much it is. I’m still the same person I was when I was in college.”
San Francisco Business Times, April 30, 1999, p. 23.
WWD, December 18, 2000, p. 18; November 29, 2006, p. 9.
“Bebe Stores Inc.: This Is No Fashion Victim,” Busi-nessWeek,http://www.businessweek.com/1999/99_22/b3631025.htm (July 11, 2007).
“Entrepreneur as Stunt Man,” Forbes.com, http://members.forbes.com/forbes/1999/1101/6411228a_print.html (July 17, 2007).
“SF State Receives Largest Individual Gift in Its History: $10 Million,” San Francisco State University, http://www.sfsu.edu/news/prsrelea/fy04/070.htm (July 11, 2007).