A SERIES OF white lacquered trays in Serena Dugan’s studio are emblematic of what she has come to represent: an understated and seemingly effortless “California chic” that belies her busy world of designing new textile patterns and an ever-evolving line of tasteful, environmentally friendly furniture, bedding and clothing. With her partner Lily Kanter, she leads a team of 100 people from their Schoonmaker Point Marina headquarters in Sausalito and scouts out new retail locations in the U.S.
Each tray, lined up on the large black worktable and on the bookcases along the back wall of this light-drenched space, represents a distinct task on her agenda.
One holds a lampshade and some drawings for Dugan and Kanter’s eponymous Serena & Lily Los Angeles store, at this time just weeks from opening. Others hold drawings and fabric samples related to products in development. The glossy trays — like the woven-plasticseated stools at the worktable and the couch Dugan and Kanter sit on, and nearly everything else at Serena & Lily — can be found in the fast-growing home goods maker’s catalog or on its website (Grand Lacquered Tray, $265).
But none of the projects in the trays are to occupy the afternoon when I visit Dugan and Kanter in the studio. Instead, Dugan eyes two 7-foot blank canvases leaning against the white wall.
“Today, I’ll put on overalls and I’ll be making giant paintings to be installed on the walls of our L.A. store,” says Dugan, who is the company’s chief creative officer but also a decorative painter and designer.
Opening two new locations (the other is set to open in a historic mansion in Westport, Connecticut, in early 2016) is part of a retail expansion that Kanter and Dugan plan to continue.
“We’re looking at a number of markets right now on the East Coast and in the Southeast,” says CEO Kanter, whose previous life as a Microsoft executive prepared her to be a retail entrepreneur more than you might think: she was hired to manage sales to the retail industry in the western U.S. In 1999, she created her first industry-disrupting store: microsoftSF in the Metreon, the software maker’s first retail venture.
“I wrote a business plan and took it to Bill Gates and Steve Ballmer and they funded it, so that’s what brought me to the Bay Area,” Kanter recalls.
She left Microsoft at 35 when expecting her first child, giving up life as a road warrior to open Mill Valley Baby and Kids Co., a retail store intended to help fund the hands-on philanthropic work she had begun as a Microsoft executive. It put Kanter on the cover of Time as the only female face in a crop of “New Philanthropists.”
But if Kanter thought the baby store would keep her life quiet and close to home, she was only partly right. That store led to Serena & Lily, a company now on a roll, not just opening new stores but expanding from home goods to apparel with its women’s collection in 2015. At the same time, Kanter and Dugan are constantly pushing at retail’s boundaries, lately by making the customer’s experience on the website, mobile site and catalog more immersive — “bringing the design shop to them,” as Dugan puts it.
Serena & Lily’s website and catalogs already make the brand more accessible to consumers than some other high-end brands that sell mostly to professionals, says Chicago interior designer Allison Honsen Delaney, who steers clients who want a tailored yet comfortable look in their direction.
“They are a favorite of mine if I have to recommend a retail resource to a client, because of how easy it is to order online and how well curated their catalog is,” Delaney says.
How did Kanter go from operating a single store to building a brand with 533 items ranging from bedding to custom upholstery, one that’s redefined intimate home spaces like the baby’s room? Judging from the juggernaut that has been Kanter’s career path, it’s clear she was never destined to keep things small. But the catalyzing event happened on a day when Kanter was not even in her shop. She was at the hospital, giving birth to her second son, when Dugan walked in bearing pieces of hand-block-printed fabrics she’d created while working as an artist and designer for both retailers and private homes.
“Serena was doing a lot of decorative painting in nurseries,” Kanter recalls; she herself had been immersed in nursery decor both at home, preparing for her new baby, and at work.
“We both arrived at the same conclusion: that what we would want in our baby’s nursery didn’t exist in the marketplace,” Kanter says.
This was 2003, and Dugan describes the crib bedding on the market at the time — even high-end stuff — as “fairly saccharine.”
“It was ducks and bunnies and choo-choo trains and pastel colors, and it wasn’t really speaking to the parents. It was speaking to the child,” Dugan says.
Kanter knew that she was not the only woman out there who arrived at motherhood with career successes behind her and a grown-up sense of interior design. Dugan hadn’t started her family yet, but she had watched her clients grasp for something missing from the marketplace.
“We were appealing to a slightly older mom who had more sophisticated taste and probably more money to spend on this very important, very valued space and life experience,” Dugan says.
A partnership seemed natural. Not only did their talents and interests dovetail, but their names combined to make the kind of moniker that consultants are paid thousands to coin. It evokes the serene surface of a lily-dotted pool — just the kind of feel one aspires to in a home, especially a home with a baby in it.
Serena & Lily’s first batch of 15 crib bedding sets featured some illustrations, but they were silhouetted in clean lines, pops of color on white fabric and fine tailoring. It was, in short, the kind of clean look that you now see in the baby stores of much larger mass-market brands.
“It was such a paradigm shift to what was out in the marketplace. And now the market has really moved toward this aesthetic completely,” Kanter says.
They sent their catalog out to 400 boutiques nationwide, and immediately their fax machine began spitting out orders — 100 in the first few weeks alone. They knew they were on to something.
For the first few years, Kanter and Dugan sold their products — which grew to encompass kids’ bedding and later the parents’ master bedroom — through retailers, the biggest customer being Kanter’s Mill Valley Baby and Kids. But in 2008, Kanter, who brought e-commerce experience from Microsoft and before that managed Deloitte & Touche’s retail consulting practice, decided it was time to add a shopping cart to the website and sell direct to consumers as well as wholesale. The next year, they mailed their first retail catalog to 85,000 households.
Although the recession was what prompted Kanter and Dugan to reach out to the consumer, the move may have saved the young company from becoming one of the downturn’s casualties, because many of the retail partners they originally sold through disappeared.
As it moved into retail, Serena & Lily accepted its first institutional investments. Since 2008, the company has raised more than $25 million to fuel its growth.
The partners took venture capital because they knew that larger retailers were not going to sit back and watch them dominate the territory they had staked out. They could not be like Crate & Barrel, taking 30 years to build up a national brand brick by brick.
“In today’s world, things are so easily taken and scaled by others that it’s almost required to build your business faster,” Kanter says.
A dozen years in, that growth curve makes for a headquarters whose bustle recalls the rush of activity on Liberty Ship Way 75 years ago. The mission then was life-and-death — from 1942 through 1945, men and women worked around the clock in the building that now houses Serena & Lily and other offices, fabricating copper pipes and ductwork for the Liberty Ships that helped win World War II.
Nowadays, below the vaulted ceiling of the onetime pipe and copper shop is a staging area where Serena & Lily’s creative staff can play with samples of the company’s home accessories and furnishings. Wooden patio recliners with vividly patterned cushions crouch near couches and tables, some of them yet to hit the market, while a couple of rattan chairs from a previous collection hang from beams high above. Along the white wall runs a strip of white corkboard festooned with bright-colored fabric swatches, drawings and computer-generated images that will lead to the offerings in future Serena & Lily catalogs.
Walking into this ethereal space feels like playing house — only with some pretty dreamy playthings.
“It becomes the fantasy of the life customers want to live, not the restricted reality. That is in many ways synonymous with California. Forget surfers and palm trees — it’s not that literal,” Dugan says, describing Serena & Lily’s signature West Coast style. “It’s just the possibility and lack of rules and the free thinking — and there’s a lot of beauty at the same time.”