Coco Chanel's Fierce Determination

The Creation of Her Global Empire

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About Today’s Piece on Coco Chanel

I read the book Coco Chanel: The Legend and the Life by Justine Picardie to write this piece. Quotes from the book will have Justine’s name beneath them.

Of course, there’s a lot I couldn’t include in this piece, but I found Coco’s story captivating and there’s so much to learn from her.

Coco Chanel

Coco Chanel

Coco Chanel is a legend whose name has been known globally since the early 1900s.

Her namesake company did more than $17 billion in revenue in 2022 and today is one of the leading luxury brands in the world.

If you know anything about Chanel’s background, you’d understand just how remarkable of an achievement this is.

Chanel went from growing up in a poorhouse and then an orphanage to, at her peak, running a company with 4,000 employees.

And her customers were part of her legend:

When my customers come to me, they like to cross the threshold of some magic place; they feel a satisfaction that is perhaps a trace vulgar but that delights them: they are privileged characters who are incorporated into our legend. For them this is a far greater pleasure than ordering another suit. Legend is the consecration of fame.

Coco Chanel

Her story is one of fierce determination and built from a seemingly endless supply of ambition.

Let’s get to it.

Early Days

Born Gabrielle Chanel on August 19th, 1883, Coco, a name she’d get years later, entered a world of poverty.

Her father wasn’t present at her birth, but he married her mother when Coco was 15 months old.

In 1895, when Coco was only 11 years old, her mother was found dead in a freezing room on a cold February morning. It was the start of a series of tragedies in Coco’s life.

After her mother’s death, Coco lived with her two sisters in an orphanage run by nuns at the Abbey of Aubazine.

Her father dropped them off and never returned.

Throughout her life, Coco told lies to conceal her origins. In regards to her father, she said he had left in pursuit of his fortune in America, which was not true.

She also called the nuns her “aunts” throughout her life.

Tragically, reflecting on this time living at the orphanage, she would say:

I realized no one loved me and I was being kept out of charity.

Coco Chanel

Coco would spend seven years there, leaving when she was 18.

She’d later talk multiple times about wanting to kill herself as a child due to that experience, being unloved by the “aunts” and being abandoned by her family.

Talk about a rough start to life.

But this start would give Coco the desire to be independent and fuel her determination for decades.

Starting Chanel

Early on in her adult life, Coco had aspirations of becoming a singer.

In fact, that’s how Gabrielle became Coco, after regular performances where she’d sing about a girl who lost her dog, named Coco. The audience would end up giving her that name.

These performances would eventually lead to her meeting a couple of important people for the start of her Chanel empire: Arthur “Boy” Capel and Etienne Balsan.

While she’d have a number of different love interests, clearly not the focus of today’s piece, these two helped her get the business off the ground.

Boy and Balsan were friends and, at different points in time, Coco had some type of romantic relationship with each of them, though she was in love with Boy.

I only bring that up because it’s Boy who she came with to Paris, and yet, she didn’t want to have to rely on someone else:

I had no money. I lived at the Ritz and everything was paid for me. It was an incredible situation. Parisian society talked about it. I didn’t know Parisian society… It was very complicated. The cocottes were paid. I knew that, I’d be taught that. I said to myself, “Are you going to become like them? A kept woman? But this is appalling!” I didn’t want it.

Coco Chanel

For those wondering, cocottes, are, according to the dictionary, “A high-class female prostitute in the second half of the 19th century and the very early 20th century.”

Coco clearly didn’t want to be like them.

She wanted independence, the type you can only have by building something of your own.

Only one problem.

As she mentioned, Coco didn’t have any money.

So she did what any broke startup founder would do - she raised money from investors.

Sort of.

What she did want was to earn her own living.

Eventually, after protracted negotiations, Balsan and Capel agreed to share the cost of setting her up in business to sell the hats that she was already making for herself, and for her friends (and their girlfriends).

Among her first clients were Emilienne d’Alençon, Suzanne Orlandi and Gabrielle Dorziat, the cocottes-turned-actresses who began to wear Chanel’s designs on stage and in magazines.

Capel covered the running costs; Balsan provided the Paris premises at his bachelor apartment in Boulevard Malesherbess.

Justine Picardie

So Coco was set up to run her own business in 1910.

And she took it seriously:

They had decided to give me a place where I could make my hats, the way they would have given me a toy, thinking, “Let’s let her amuse herself, and later we’ll see.”

They didn’t understand how important this was to me. They were very rich men, polo players. They didn’t understand anything about the little girl who came into their lives to play. A little girl who understood nothing of what was happening to her.”

Coco Chanel

I have to highlight one thing she mentioned: They didn’t understand how important this was to me.

This was the start of something much, much bigger.

I’m sure Coco had no idea at the time that this business of hers selling hats was going to one day become a global brand, but she did already have an idea that this was her path to freedom.

In the coming decades, she would prove just what is possible when you take something seriously, committing wholeheartedly to it.

Initially, much like an MVP for startups, she sold simple hats that were, “stripped of embellishments, of the frills and furbelows that she dismissed as weighing a woman down, and being too cumbersome to let her think straight.”

As Justine Picardie would describe in her book:

They weren’t entirely original - at first, she bought simple straw boaters from the Galeries Lafayette department store, and then trimmed them with ribbon herself - but they were chic.

Not entirely original.

Simple products.

But chic.

Also, the first product that would launch an empire and a lesson for founders: start with what you have around you and keep it simple.

Of course, creating a product is one thing, selling it is quite another.

Importantly for our story, people were buying Coco’s creations:

Whether they were prompted by alarm or jealousy or simply curiosity, the beauties flocked to buy hats from Chanel at her milliner’s establishment.

Soon, her business had grown too successful for Balsan’s apartment, and backed by Capel - whose own fortunes were prospering further - she opened new premises on 1st January 1910 at 21 Rue Cambon.”

Justine Picardie

Coco was 26 at this time.

Because her business was expanding already, her sister, Antoinette, and Aunt Adrienne came to Paris to help out as both were beautiful and skilled seamstresses.

And it really was curiosity that got people to show up at her store initially:

Customers came, initially prompted by curiosity. One day I had a visit from one such woman, who admitted quite openly: “I came to have a look at you.” I was the curious creature, the little woman whose straw boater fitted her head, and whose head fitted her shoulders.

Coco Chanel

Driven by curiosity.

It reminds me of the businesses of Emily Weiss, Tory Burch, and Dave Portnoy.

In some ways, they were able to grow their companies through curiosity, whether with content or their lifestyles.

Business for Coco early on was going well, but she soon had a startling discovery:

She thought she was making more in profits but Capel had deposited bank securities to guarantee her business and over drafts - the things she had bought with what she thought were profits from her business were not so “I began to hate this well-brought-up man who was paying for me.”

Justine Picardie

But the morning after this discovery, Coco tells her seamstress, Angèle:

I am not here to have fun, or to spend money like water. I am here to make a fortune.

Coco Chanel

Damn.

I love that.

Within a year, Coco was making enough to not need Capel’s financial support.

Soon after, she expanded her burgeoning empire.

Early Expansion

In 1913, Chanel began selling clothes as well as hats, relying on her personal taste to guide her:

As always, she based her designs on what suited her - boyish jersey pieces, many of them inspired by Capel’s own English sportswear - and he backed her taste with his capital.

Justine Picardie

It reminds me of the music producer Rick Rubin's interview on 60 Minutes with Anderson Cooper:

Rick Rubin: I know what I like and what I don't like and I'm decisive about what I like and what I don't like.

Anderson Cooper: So what are you being paid for?

Rick Rubin: The confidence that I have in my taste and my ability to express what I feel has proven helpful for artists

Rick Rubin

Coco was confident in her taste and it also proved helpful, but in this regard to the plethora of women who purchased her works.

Around this time, Coco launched her little black dress, an immensely popular item of hers and a concept that she gets much credit for as a major contribution to the fashion world.

As Coco would later say:

I imposed black; it’s still going strong today, for black wipes out everything else around.

Coco Chanel

The same year, she opened her first shop in Deauville, in the shadow of the First World War.

She withdrew from Paris to Deauville, a popular seaside vacation spot of hers and Boy Capel, to continue her business.

She brought a few milliners with her to Deauville and by the end of the first summer of the war, had earned 200,000 gold francs.

Coco’s sales continued to increase in Paris and Deauville and she opened a new boutique in Biarritz in 1915.

Her ambition continued to grow:

Of course, Chanel was also ambitious - as was evident in her ascent through Parisian society.

She had gone from milliner to dressmaker to couturière, and was now admired by baronesses and princesses; she had climbed from the half-light of the demimondaine to the spotlight of worldly acclaim.

Justine Picardie

Sadly, on December 22nd, 1919, Boy Capel was killed in an accident driving from Paris to Cannes.

Coco went to the scene of the crash where the car still was after his body was removed, and she wept:

In losing Capel, I lost everything.

Coco Chanel

However, she did get 40,000 pounds from his will, which she used to further invest in her business, expanding her Rue Cambon location.

The following year, Coco met Ernest Beaux, starting the creation of the product that would make her fabulously wealthy, and showcasing her repeated use of strategic relationships to build her empire.

Chanel N°5

Chanel N°5 made Coco both very rich and recognized around the world.

It started when she met Ernest Beaux, a French perfumer, in the summer of 1920.

Ernest was a perfumer to the tsars and at the time Coco’s lover was the Russian Grand Duke Dmitri Pavlovich who introduced the two of them.

While Coco had her own story of how it came to be, another lie building her mythology and in some ways discrediting Ernest, here was his take:

I’ve been asked some questions about the subject of the creation of N°5. When did I create it?

In 1920 exactly, upon my return from the war. I had been part of the campaign in a northern region of Europe, above the Arctic Circle, during the midnight sun, where the lakes and rivers exude a perfume of extreme freshness. I retained this note and recreated it, not without difficulty, for the first aldehydes I was able to find were unstable and unreliable.

Why this name? Mademoiselle Chanel, who had a very fashionable couture house, asked me for some perfumes for it.

I came to present my creations, two series: N°1-5 and 20-24. She chose a few, one of which was N°5.

“What should it be called?” I asked. Mademoiselle Chanel replied, “I’m presenting my dress collection on the 5th of May, the fifth month of the year; let’s leave the name N°5.” This number would bring her luck.

Ernest Beaux

While the exact origins aren’t completely known, what can be confirmed is that N°5 went on sale for the first time in 1921.

Let’s remember, this is 11 years after she first started selling hats.

To put it differently, it took Coco 11 years to find the product that would bring her more wealth than all the rest. And it’d be another 3 years before she’d have the distribution and scale nailed down.

We’ll get to that in a minute.

But first, what made the Chanel N°5 perfume unique?

As Justine described in her book:

N°5 was, in some ways, revolutionary, in its blend of the natural and synthetic, thanks to Beaux's discovery of the importance of aldehydes in enhancing and stabilising ingredients such as jasmine, a key component in Chanel N°5, along with ylang-ylang, neroli, May rose, sandalwood and Bourbon vetiver.

Perfumes had traditionally consisted of a single yet heavy floral note, but Beaux came up with the scent that Chanel sought, in her quest to define herself as a designer committed to modernity; a formula that she described as 'a bouquet of abstract flowers'.

Of course, Coco had distribution in her boutiques for Chanel N°5, but the real expansion of Chanel N°5 would happen in 1924.

This expansion came about with the launch of Les Parfums Chanel and the introduction of Coco to Pierre Wertheimer by Théophile Bader:

Chanel was introduced to Wertheimer by Théophile Bader, proprietor of Galeries Lafayette, after she had asked Bader to stock her perfume in his department store (which also happened to be the place where Chanel had originally bought her straw boaters, simple pieces that she trimmed with ribbons for herself, and for her first millinery clients).

Bader was quick to see the commercial potential of Chanel N°5, at the same time as pointing out to her that if it were to be sold in Galeries Lafayette, as well as in her boutiques, the scent would need to be produced in far greater quantities than Ernest Beaux could supply from his laboratory.

But the Bourjois factories might be able to do so; hence the meeting between Pierre Wertheimer and Coco Chanel at the Deauville racetrack, where one of Wertheimer's large stable of horses was running.

Justine Picardie

It’s helpful to have a little context on the Wertheimers for Coco’s story.

They’re going to come up a couple of times and, not to spoil anything, play a big part near the end as well.

As Justine wrote:

The Wertheimers were a Jewish family, as rich and successful as the Rothschilds, but apparently even more intent on privacy. Their roots could be traced back to medieval Germany, although they had been thoroughly French for generations: knowledgeable art collectors as well as expert businessmen, who had transformed Bourjois from a nineteenth-century theatrical make-up company into a thriving cosmetics and perfume manufacturer.

Justine Picardie

After their meeting, Pierre decided to back Chanel and the production of Chanel N°5 would begin in 1924.

Les Parfums Chanel was established in April 1924 with Coco owning 10%, the Wertheimers 70%, and Théophile Bader 20%, although he’d eventually be bought out by the Wertheimers.

This was an agreement Coco would later regret and fight to change.

We’ll get there.

But first, we’ll learn how Coco continues to build her empire.

Global Influence

Coco launched her business in 1910 at 21 Rue Cambon and by 1918 she bought 31 Rue Cambon, then in 1923 purchased number 29, three years later number 25, and then in 1927 purchased numbers 27 and 23.

To help run these as well as her ever-expanding shops in various cities, she was strategic about whom she hired:

Chanel employed exiled Russian aristocrats as sales assistants and models at Rue Cambon; not necessarily as an act of charity, but as the living embodiment of the fashion and scent she was selling to her customers, who had followed her lead in embracing Slavic charm.

Justine Picardie

In another passage, Coco would be quoted as saying:

I have employed society people, not to indulge my vanity or to humiliate them (I would take other forms of revenge, supposing were seeking them), but ... because they were useful to me and because they got around Paris, working on my behalf.'

Coco Chanel

It’s like they were business development employees though instead of searching LinkedIn or Twitter, they were meeting people in real life.

It was through one of these society people, Vera Bate, that she met the Duke of Westminster, nicknamed Bendor, who was one of the richest men in Britain.

By Spring 1924, Chanel and Bendor were an item.

Through Bendor, Chanel would meet Winston Churchill and continue her incredible streak of building relationships with some of the wealthiest and most influential people of her time.

Another one of them?

Samuel Goldwyn, an American film producer whom she’d meet in the late 1920s and, by 1931, would convince her to come to Hollywood to dress his film stars.

He guaranteed her a contract of $1 million to do so and on the 25th of February 1931, she left for America. She ended up working on three films for Goldwyn.

It’s not surprising Coco was able to get $1 million for this deal, she had proved to be a shrewd negotiator.

In one argument with a woman who did the embroidery for the house, Coco was trying to get the price down on a blouse. She stuck with her guns:

I don’t care what kind of silk you use - real or artificial, it is none of my business. What I want is to sell the blouse. As it is, it is too expensive; therefore you must charge less for it. That's all.

Coco Chanel

Coco’s no-nonsense negotiating reminds me a lot of Elon Musk and how he pushed his teams to accomplish the extraordinary.

In 1932, Coco expanded into high jewelry in collaboration with Paul Iribe on her own collection of diamonds which drew 30,000 visitors over the course of a month and was incredibly impactful:

It is perhaps of interest to add that two days after the Chanel Paris diamond show opened, De Beers stock was reported to have jumped some twenty points on the London exchange.

Justine Picardie

Clearly, Coco’s influence had real power, which seemed unstoppable, but a world war would change that.

Shutdown & Battle for Control

With the start of World War II in 1939, Coco closed all of her shops except her boutique at 31 Rue Cambon, continuing to sell perfumes and accessories.

A reported 4,000 employees lost their jobs as a result.

Remarkably, the Wertheimers, whom Coco continued to partner with, managed to keep their business going:

Not only did the brothers maintain the production of Chanel perfumes in their factory on the outskirts of Paris, even as the Nazis made attempts to seize their assets (as they did those of other Jewish families), but the Wertheimers somehow retained control of their business empire.

They also got creative in their efforts to avoid both the Nazis and Coco herself from taking over their business:

Certainly, she had been engaged in sporadic skirmishes against the Wertheimers long before the Nazi invasion of France, in an effort to increase her income from Les Parfums Chanel.

But she was further enraged by Pierre's arrangements for the company when he fled Paris in 1940, whereby the Wertheimer shareholdings were taken over by Félix Amiot, a French aeroplane manufacturer, in return for a putative stake in his aviation business.

By signing Les Parfums Chanel over to Amiot, who was not Jewish (and therefore regarded by the Nazis as an Aryan owner, albeit one who would return it to the Wertheimers at the end of the war), Pierre hoped to protect the business from German requisition.

But his actions also thwarted Chanel's efforts to have the company declared abandoned when he and his brother left France, and to seize control of it herself.

Justine Picardie

This entire episode with Coco and the Wertheimers was a mess, they’d continue to battle for years, and Justine would write of it: “For there is no escaping the ugly truth of her attempt to take advantage of an anti-Jewish regime.”

Ugly to say the least.

As the battle between them continued, Coco, with the help of her lawyer, René de Chambrun, went on the offensive:

So Chanel was intent on launching her own scents, labeled in bold red as Mademoiselle Chanel, to circumvent the Wertheimers. By 1946 she had produced samples that were good enough to rival the ones produced by them.

Justine Picardie

And Coco, with her vast network of powerful connections, leveraged them as well:

The brothers had by then invested massively in their US company Chanel, Inc., spending a million dollars on advertising alone; an investment that would have been undermined by a competing range from Mademoiselle Chanel.

As Chambrun explained to Galante, Chanel had already sent samples of her red-label scents to 'her old friends Bernard Gimbel and Stanley Marcus [who between them owned the most powerful American department stores, including Saks Fifth Avenue] - people well-entrenched in the US perfume trade.

Justine Picardie

It proved to be a smart move that forced the Wertheimers to make a deal.

After the Wertheimers and their entire management staff burst into Coco’s office one day asking what she wanted, Coco got an unbelievable deal.

As Justine wrote:

What Chanel got, after a meeting that went on into the early hours of the morning, was a deal that made her unassailably rich: “After May 1947, Coco received 2 percent on the gross royalties of perfume sales throughout the world, in the region of $1 million a year. She also received a sum calculated to cover past royalties.”

Seven years later, Coco was back for her final act.

The Comeback

On February 5th, 1954, at age 70, Coco Chanel launched her comeback collection.

After nearly 15 years away she was back.

I love that she launched a comeback at 70 years old. She didn’t let her age determine what she could do with her life.

The same year, after several months of negotiations, the Wertheimers agreed to buy Coco’s business:

In effect, they were to underwrite the couture house, gaining all rights to Coco's name, in return for paying every penny of her expenses, including her personal bills at the Ritz and elsewhere. Chanel kept creative control, and her royalties from Les Parfums Chanel, but gave up any involvement in the financial running of her company.

Justine Picardie

A few years later, in an interview when she was 74 years old, Coco was asked why she had been in retirement so long.

I love her answer:

Never was I really in retirement in my heart. Always, I observed the new clothes. At last, quietly, calmly, with great determination, I began working on une belle collection. When I showed it in Paris, I had many critics. They said that I was old-fashioned, that I was no longer of the age. Always I was smiling inside my head, and I thought, I will show them.

Coco Chanel

I will show them.

74 years old and she was still as determined as ever.

And she was also still incredibly competitive, as shown when asked about her young rival at the time, Yves Saint-Laurent:

Saint Laurent has excellent taste. The more he copies me, the better taste he displays.

LOL.

Coco would spend the rest of her days working on what she enjoyed:

On the day before her death, 9th January 1971, Mademoiselle Chanel was still working, even though it was a Saturday, furiously racing against the clock to finish her latest couture collection.

She found her life’s work and was able to succeed with fierce determination, trusting in her own taste and relying on a number of strategic partnerships.

What an incredible life.

Coco’s Wisdom

In each edition of the Just Go Grind newsletter, I like to include a few more quotes at the end from my research into the founder who is featured, sharing their wisdom.

On becoming a legend:

Those on who legends are built are their legends.

Coco Chanel

On the importance of fashion:

Fashion allows millions of men and women to earn their living. The wool, the cotton and the silk industries, also the industries of feathers and artificial flowers. Also the industry of material weaving and the dye industry. And do you realize what the transportation of goods means? Do you realize what it means for the railroads, the navigation corporations, the customers people, the merchants, the owners of shops, large and small, the salesmen and the saleswomen?

Coco Chanel

On living alone:

One shouldn’t live alone. It’s a mistake. I used to think I had to make my life on my own, but I was wrong.

Coco Chanel

On thinking differently:

Women think of every colour, except the absence of colours. I have said that black had everything. White too. They have an absolute beauty. It is perfect harmony. Dress women in white or black at a ball: they are the only ones you see.

Coco Chanel

On the strength of women and feeling young at 74 years old:

Women have always been the strong ones of the world. The men are always seeking from women a little pillow to put their heads down on. They are always longing for the mother who held them as infants. It is just my opinion. I am not a professor. I am not a preacher. I speak my opinions gently. It is the truth for me.

I am not young, but I feel young. The day I feel old, I will go to bed and stay there. J'aime la vie! I feel that to live is a wonderful thing.

Coco Chanel

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