i'd like to get some fun. maggie: i love fun. hold my hand. pulse. put your back up. lemonis: that's the fun part? at a women's activewear company based in los angeles, the owner only sees things in black and white. maggie: i do what i want, kind of like what i would want to wear. lemonis: and what if you wanted to come up with a printed fabric? maggie: i would never do printed. lemonis: maggie montiel found early success by building a multimillion-dollar company completely online. maggie: it does really well, and it sells. lemonis: now her conservative aesthetic is starting to lose popularity... woman #1: this looks a little mommy to me. if you really made a point of being, like, the one that had the fashionable bras, women need that. lemonis: ...dealing a blow to her bottom line. revenue went down pretty significantly, right? maggie: yes. lemonis: and yet she still doesn't want to take the risk

to adapt to the latest trends... maggie: i don't think i would call myself a rebel. lemonis: what would you call yourself? maggie: safe. lemonis: ...even if that's what the customers want. woman #2: you need to be more aggressive with the style of the leggings. maggie: no. lemonis: if i can't get this owner to think creatively... maggie: i like the shape. i like how it fits the waistline. susana: it's really mediocre. maggie: thank you. lemonis: ...her beloved fashion brand may go out of style forever. honestly, i wouldn't take any of that. none of it. my name is marcus lemonis, and i risk my own money to save struggling businesses. we're not going to wake up every morning wondering if we have a job. we're going to wake up every morning wondering how many jobs we have to do. it's not always pretty. everything is going to change -- everything. but i do it to save jobs, and i do it to make money. this... let's go to work. ...is "the profit." ♪

the athleisure industry has exploded in the last several years, and what appeals to me about montiel is that it broke through the clutter and quickly gained a following. it's only been around since 2013, so i'm heading over to the company's warehouse in downtown l.a. to learn more. hello? hi. maggie: hi. lemonis: how are you? maggie: i'm good. how are you? lemonis: good. i'm marcus. maggie: maggie. nice to meet you. lemonis: maggie, nice to meet you. kiara: kiara. yes. lemonis: kiara? lemonis: that's a cool name. kiara: thank you. cambria: cambria. lemonis: how are you? another cool name. everybody has got nice names. are guys all wearing the product? kiara: yes. maggie: we are. we are. kiara: we live in it, so... cambria: i wear it, like, every single day, like, to work out in. it's just -- it's perfect. lemonis: yeah. athleisure is really the new denim. maggie: well, you know, once you go leggings, you don't really go back in your jeans. lemonis: are you trying to hurt my jean business? maggie: no, no, no. i wear them on the weekends. on the weekends, on the weekends, on the weekends. lemonis: do not mess up my jean business. so what exactly do you guys do?

maggie: so we make women's activewear -- bras, panties, leggings, stuff like that. we do all the manufacturing and everything in san diego, so it's all made in the usa. i use a contractor... lemonis: oh, you do? maggie: ...but i order all the materials to make it, and they cut and sew it. lemonis: can i see some pieces? maggie: yeah, of course. lemonis: i want to see what the top sellers are. cambria: definitely our teardrop bra. this is our number-one seller. lemonis: this is the number-one seller in the company? maggie: yeah. that's the one that i started with. lemonis: wow, this feels really nice. kiara: right now, i have on the reagan. lemonis: which one is that, that one? kiara: this one, in black. lemonis: what do you like about that? kiara: i think the straps. lemonis: okay. cambria: these are the lea leggings. lemonis: how much stretch is in here? cambria: there's about 5% spandex. lemonis: yeah, it does feel nice. as i look at the products that maggie makes, i would say that, from a quality standpoint, they're superior. you put a nice grain in it. maggie: yeah, that's our special blend. lemonis: ...but they seem very plain. how many different colors overall in your whole collection? maggie: 9, 10. lemonis: and what if you wanted to come up

with a printed fabric or a different color? maggie: i would never do printed. i think it's a little cheesy. when i think of prints and stuff like that, they're more fad. lemonis: so who created this? maggie: me. i kind of got a little bullied with that one because everybody was doing color blocking. i don't think i would want to be seen in that. cambria: my sister loves them. lemonis: i get the sense, and i'm totally reaching here, that if you don't like it, it just doesn't sell. maggie: it's kind of easy when it's your line. you can kind of control that. lemonis: and so, how do you innovate? maggie: i do what i want, you know, kind of like what i would want to wear. lemonis: it's obvious to me that maggie makes products that she likes and that fit her personality. oh, is this your look book? maggie: yeah. lemonis: the only thing it doesn't show me is how i could use the product. and what's puzzling to me is the presentation of it. i don't see any diversity in terms of activity, not even riding a bike or jogging. the usage of the product feels a little one-dimensional. if you like to do a particular activity or wear a particular color and maggie doesn't have it,

it's almost like she's telling you, "go shop somewhere else." who actually designs? maggie: so i do the design. what i do is, i come here in the morning. i usually arrive before them, and i get so much done before they come. lemonis: like... maggie: see, i'm so weird because i can't have noise. i can't work with noise at all, and i go, and i do the rest of my work from home in silence. cambria: it's really weird. no, we just sit here and talk to each other all day. lemonis: let me just see if i can understand this again. you come here early in the morning when nobody is here. you work, and then as soon as humans come around... maggie: i'm out. lemonis: ...you leave, and you go work at home where there's nobody. maggie: exactly. lemonis: maggie actually reminds me of a girl that used to sit next to me in grade school who used to always shush me. i would describe maggie's personality as introverted, and there's nothing wrong with that, but if you're going to lead a business, you're going to have to somehow get out of your shell. it's direct-to-consumer only... -maggie: yes. lemonis: ...and trunk shows? maggie: no trunk shows. and we don't do wholesale. lemonis: that's it, online, no other way to buy it? maggie: as of now, yeah. lemonis: buy it from you, or don't buy it at all. maggie: right. well, and we did that

because i wanted to offer a better price. so i wanted to charge 38 bucks for this and not $58. lemonis: right. it seems problematic to me that maggie only sees value in selling online, and while i'm in favor of the bulk of her revenue coming from that channel, it's helpful for a business to just think differently and not think so one-dimensional. what prompted you to open this? maggie: it kind of fell in my lap. my dad has been in the industry. lemonis: your dad was in this business or just in the fashion business? maggie: yeah, in the apparel business. yeah, for 40-plus years. lemonis: really? what did he do? maggie: he did ashworth golf apparel. lemonis: okay, cool. maggie: yeah. so my dad was liquidating one of his lines, and it was a ladies activewear line, but it was more towards an older demographic, so i helped him liquidate the company, and i was doing trunk shows, and i went to my dad. i'm like, "how can i make this bra in a ton of different colors?" and that's where it started. lemonis: when did you start this? maggie: november 2013, and that was in my two-bedroom apartment. lemonis: so how many team members, just the three of you? maggie: so for the office, it's the three of us. lemonis: and your dad is still involved in the business?

maggie: yeah. he's our ceo. he helps. lemonis: why aren't you the ceo? maggie: because i think that having somebody who's been in the business and knows what he's doing and has taken other companies public is really important because, at that time, i wasn't qualified to be a ceo. i wasn't qualified to be a president at the time. lemonis: on first blush, it seems like a good idea that maggie has really acquiesced the ceo title to her father, who has years of experience in this industry, but to use him as the ceo feels a little like a cop-out to me. and so social, who drives social? maggie: me. lemonis: you do? you do it all yourself? maggie: mm-hmm. i did all of my advertising through facebook, and i got in at a really sweet spot. i had sales right away, and i had people following us, like, really fast. lemonis: i think it's very smart that you did that. maggie: thank you. lemonis: it seems like a great instagram product, as well. maggie: yes, it is. lemonis: how much inventory in total? maggie: there's about 24,000 units in here. lemonis: and what does that equate to in dollars? maggie: it's about $250,000. lemonis: what were you doing in cost of goods for the year? maggie: like 44%.

lemonis: so how much revenue will you do? maggie: sales, we did $1.8 million. the year before, we did $2.1 million, so we dipped. customers, they're just not coming back. lemonis: do you ever change your mind-set and come up with new things? maggie: i have no interest in that. lemonis: uh-huh. maggie: i feel like i have a lot of pressure on me, and -- lemonis: where is the pressure coming from? maggie: myself. i want to be successful for my parents. i don't sleep. it was worse when i was younger. i've kind of gotten control of the anxiety part. well, to get it started -- lemonis: are you happy now? maggie: no. lemonis: why not? maggie: because now i'm worried. now i'm worried. lemonis: would you have fun, please? maggie: okay. well, all right. i'm trying. lemonis: any time i go into a business, i have to really, early on, determine what my process is going to be like with the business owner. am i going to have to be very tough? am i going to have to be aggressive? am i going to have to be persuasive? in the case of maggie, giving her opportunities to try things without fear or failure or without any consequences to that failure may be a better path.

maggie told me that her father is actually the ceo, and so i thought it'd be a good idea for us to meet before we sat down and had any more discussions, so we're going to meet at the cut-and-sew factory in san diego. how are you? i'm marcus. gerry: i'm gerry, marcus. lemonis: gerry, how are you, sir? gerry: i'm good. nice to meet you. my pleasure. she wanted to get in when she was about 10 years old, and she wanted to make clothes when she grew up. lemonis: because her dad made them? maggie: yes. i was running around in ashworth as a kid, up and down, as they were sewing. it was like -- yeah. lemonis: can we get a tour of this place? maggie: absolutely. gerry: sure. lemonis: this place is cranking, isn't it? gerry: this is a great shop. lemonis: i mean, wow. gerry: these people have just been fabulous for us. lemonis: they're amazing. and so once it leaves here, it's bagged and tagged, right? maggie: and it comes to l.a. lemonis: i'm impressed with the type of capacity that is available to her at her cut-and-sew operation. what it tells me is that if the business explodes, we're not going to have a problem on the manufacturing side. sally: hi. maggie: this is sally. sally, marcus.

she does all the patterns. so this is where we do all of our cutting. i buy my fabric. it gets shipped here, so he's holding our fabric, as well. lemonis: do you think her personality and the product are similar? sally: yes. she tones it down a little bit. lemonis: she pulls you back? sally: yes. maggie: we have different styles. we do. lemonis: i would love to see something that's, like, different. sally: well, she wants to play it safe starting out because we don't quite know our audience yet, and you want to make products that are for sure going to make it out the door. black and white is a sure thing. lemonis: now, it's clear to me that maggie and sally have put a lot of thought into the pattern, providing the right support, but remember that consumers buy with their eyes, and so if it's not visually appealing, you may never get a chance to tell that story that it fits great. so it goes to the customer like this, so no branding on here at all. and this really gorgeous bar tag is on there, or do you take it off? maggie: unh-unh. lemonis: they see it, and they get a warning label, nothing about montiel.

maggie: not in that polybag, no. gerry: that's a good idea that you're making, though, that maybe we should print some bags. lemonis: i would almost advocate spending the money on doing a two-tone bag, where there's maybe clear and then a smoky window where you can actually print on it. it'll stand out. i think the thing that people have to remember is, a good chunk of what happens online is gifting, and if i wanted to buy that gift for somebody, i would have a high expectation that it would arrive with a level of presentation that would make me feel like you put in attention to detail around everything. all right. we'll get out of your hair. thank you so much. maggie: thank you again. ♪ ♪ lemonis: how are you? maggie: good to see you. lemonis: how are you, sir? gerry: how are you doing, bud? lemonis: it's good to see you. thanks for coming out. gerry: oh, my pleasure. maggie: so i'm going to give you the 2017 financials. i also brought this... lemonis: you know, maggie, i'm old. i can't read this. maggie: i know. gerry: i didn't bring my glasses, either.

lemonis: so 2016 was a little bit over $2 million in revenue. gerry: right. lemonis: it looks like it made $96,000. gerry: yes. lemonis: okay. in 2017, shows $1.8 million of revenue, so was it a loss in '17? gerry: no, we actually made about a quarter of a million dollars last year. lemonis: revenue went down pretty significantly, right? maggie: yes. lemonis: how much inventory do you have in your warehouse? maggie: about $250,000. lemonis: and how much cash in the bank? gerry: 300 grand. lemonis: remind me -- was there any debt in the company? maggie: nothing. no debt. lemonis: no debt. essentially $500,000 in assets... gerry: yes. lemonis: ...with a nice profitable business. so why did you guys call me? where do you think i can help you? maggie: i want to continue to grow, and i know i can't do it alone. there's not as many orders this month, you know, compared to what it was last year. lemonis: business is slowing down? maggie: yes. gerry: what do we need to do to increase our marketing to gain sales? lemonis: i think when you really want to take the thing from $2 million to $20 million, you're going to have to try things that, 50% of them may --

you have to have a stomach to be able to swallow a failure. i didn't get the sense, in our first day, that you're necessarily a risk-taker. maggie: okay. lemonis: i feel like the line is a little flat. it feels very safe to me. maggie: mm. i still don't look at it as safe. i let the customers kind of lead me. it's worked. gerry: i think maybe, in the business, it's a little bit of a handicap for her. lemonis: why? gerry: she doesn't want to disappoint me. she's a little conservative in a lot of things that she does. lemonis: she'd rather go straight and slow than make a left or a right turn and have it be wrong out of fear that it may disappoint you. gerry: lot of truth. maggie: there's a lot of truth to it. lemonis: i love the business because i feel like you live the business and you are the business and that your work and your social lifestyle is the product. so i want to invest $1 million in the business. maggie: a million dollars? lemonis: yeah. i know women's apparel pretty well. i'm willing to take chances, and how i see it is, you will be the ceo of this business, not your father and not me, and in order to be the ceo,

you have to be bold and a risk-taker. safe doesn't work for me because i like to throw stuff against the wall and see what sticks... gerry: right. lemonis: ...spending money on custom colors and spending money going out and doing research. i think the packaging is terrible. it doesn't feel special. maggie: it could be so much better. lemonis: there's some level of embellishment that can be done to some of the products to give it a novelty piece. i don't think that this product should be singularly focused on a yoga lifestyle. maggie: yeah. lemonis: i think it's more of an active lifestyle. i would then look at contract manufacturing, really building collections for other people. gerry: perfect. lemonis: so my offer is $1 million for 60% of the business. maggie: um...so i didn't think we would have to give up as much equity, but i so value you. i would like to do something that would be under 50% equity. lemonis: um...

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upload your logo or start your design today [ ding ] show me just add magic. hey toothless. [ ding ] [ gurgling ] [ ding ] show me cartoons on netflix. [ ding ] [ cooing ] [ door closes ] [ cooing ] ♪ [ ding ] show me fish on youtube. say it and see it with the x1voice remote. from netflix, prime video,youtube and even movie tickets. just say get "dragon tickets". that would be under 50% equity. lemonis: what percentage were you hoping that i was at? maggie: 40%. lemonis: um... you bring years of experience. she brings the knowledge of the industry. i want to be respectful of that, so my revised offer is 45% of the business for $700,000.

gerry: what do you think, mags? maggie: absolutely. gerry: let's do it. maggie: i could not -- lemonis: you want to do it? maggie: yeah, absolutely. lemonis: okay. maggie: that is so cool. lemonis: you ready? maggie: i'm so ready. lemonis: okay, congratulations. maggie: thank you so much. that's awesome. i'm so excited. lemonis: congratulations. gerry: thank you so much. lemonis: it's going to be fun, man. ♪ what's up, my man? kenny: how are you? good to see you. lemonis: did you dress up for me? kenny: i did. lemonis: today we're meeting at lua + sol. it's a company that can license prints and different designs and lyrics to put on a lot of our garments. this place is pretty much the exact opposite of what maggie does. i'm hoping that she's open to this idea. putting any designs on her garments would be a huge change for her. i wanted to create a couple of capsules inside of montiel, one that's maybe maggie. kenny: yep. lemonis: actually, that would be the name of it. kiara: oh, wow. that's so cute. cambria: so cute. maggie: it's a pretty cute name.

lemonis: we want it to be really representative of your personality... maggie: oh, boy. lemonis: ...which i haven't seen yet, so at this point, it'll be a bowl of vanilla ice cream. maggie: i don't eat ice cream. lemonis: my ultimate goal with montiel is to create three distinct lines of revenue. the first line of revenue is to continue to sell her core products and add embellished products using lua + sol under the brand of maggie. t-shirts, other products that she has today, but something fun and different. the second line of revenue would be for maggie to collaborate with one of my other designers and companies, susana monaco, to create a whole new line for the wholesale market. the third line of revenue would be maggie creating co-branded products for specific businesses, unique just to them. kenny: this is a list to inspire where you want to land in terms of your messaging. to think about lyrics, it's endless. maggie: okay, so, "you may say i'm a dreamer, but not the only one." eh? no, i don't think so. "i found the greatest love of all inside me."

no. "i'm just beautiful me" -- selena gomez. eh, no. "look at the stars. look how they shine for you." "i will be rising from the ground like a skyscraper." interesting? lemonis: none of those you like? maggie: no. i didn't love them right off the bat. lemonis: i'm disappointed with the fact that maggie is not even being open-minded to any of these ideas. "no" usually should be followed with, "but what if we tried this?" or, "what if we did this?" kenny: are there any artists that inspire you? cambria: i think lady gaga is, like, supercool, such a strong woman. maggie: yeah, nope. cambria: nope? [ laughter ] maggie: let me skip her. juli: but i think that she has a plethora of songs, i feel like, and lyrics can mean something to everybody, like, a little bit something different. so it's -- you're pulling that emotion out rather that promoting that person's face. maggie: right. i mean, i've loved, what's her name, dua lipa? her whole album -- nailed it. lemonis: you should buy montiel why? maggie: why? because it's good quality

to live a comfortable, healthy lifestyle and for a better price point than the other guy. lemonis: welcome to target. we need to pick 10 or 15 things around here that we can start to get to work on, and i want you to work with juli, collaborate with her, because we need to get some direction and, like, some [bleep] done. thank you, guys. ♪ i love this area. maggie: i know. i always say i want to live over here, and then i never do. lemonis: until now, maggie has marketed her company entirely to the yoga community, and so i want to open up her mind, and i'm going to take her to flywheel. it's a national chain of spin studios that are going to have a ton of active, outdoor-type customers, and they're going to give her good feedback on her product. and if she plays her cards right, there may even be an opportunity here. i want to see people actually use the product, i want to get their feedback on the product, and then we're going to go to new york and talk to them about taking over their whole apparel department across the country.

maggie: oh, wow. okay. lemonis: all right. let's go inside. ♪ maggie: so i'm going to get you going first. do this one. i'll pull some extras out. woman #3: do you have green pants? maggie: i don't have green pants. lemonis: having a full class of customers wear our product and use it during an actual class and give us feedback is a great way to do research to give us the kind of changes that we need to make to be successful with flywheel. [ all cheering ] maggie: so let's hear it, guys, anybody. woman #4: one thing i just noticed right now is, like, you can sort of see the sweat around the crotch area. maggie: i mean, with nylon, it's going to happen. it will dry really fast. woman #2: you need to be more aggressive with the style of the leggings -- cutouts, metallics. women really like to get a little bolder. maggie: no. it does really well, and it sells. woman #5: in the tops, i would love to see, like -- flowy crops would be really nice.

woman #1: and then this looks a little mommy to be. if you really made a point of being, like, the one that had the fashionable bras, women need that. i don't know what your demographic is. like, i would never wear that. lemonis: i don't love the font. it's very cartoonish. maggie: look on the inside. "got you, girl." it's an inside pocket. lemonis: i don't think there's anything special about this. honestly, if that's what we're taking to flywheel, we shouldn't go yet.

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like, i would never wear that. maggie: i have the proof that it sells. woman #2: fashionable. woman #1: like, clearly, fashionable bras, like, that's huge. woman #6: i have a shirt that says, like, "heart and hustle." like, i'd kind of like a, "heart and hustle." woman #1: i think that this is -- this is always hard. lemonis: this what? what is that? woman #1: the leg. it's always hard to figure it out. usually i put them under my shoe, but then it gets caught, and then my pants fall down. lemonis: they're long on almost everybody. maggie: they're made to shrink about 1/2 an inch, so they will tighten up for the ones that are loose. lemonis: but i don't want to buy something that i have to wash to make fit...

maggie: no, but it's... lemonis: ...as a consumer. i was kind of surprised, even shocked, at how combative maggie was while she was getting feedback from people about her products. okay, thank you, ladies, very much. ♪ you have to be able to listen to all the feedback and take the super-positive stuff and the super-negative stuff and lay it off on the side and find something that's running through the whole thing. maggie: i am getting frustrated because you're challenging me. lemonis: it's how you process the feedback. it's like, "well, you're going to wash it, it's going to shrink, and it's going to be fine." maggie: no, i just want them to know that there's hope, like, if it feels too big. lemonis: well, but maybe it just needs to be fixed. or, "your pants are too long." "yeah, but, you know what? there's different sizes for everybody," but everybody's pants were long. maggie: yeah, everybody's pants were long. lemonis: okay. all right. ♪ maggie: i'm going to throw her in stretching, too. man #1: yeah, let's do that. lemonis: i've wanted to change the way

that maggie was marketing the company specifically just to the yoga community, and so we flew all the way to new york so we can do a photo shoot in central park -- a different environment, a different attitude, a different mind-set. maggie: can you do a couple jump squats? lemonis: in order for this company to be successful, we need to be able to demonstrate that it can be more exciting and can be used for more than stretching. [ camera shutter clicking ] i'd like to get some fun. it's, like, everything feels so serious right now, and i think you need to loosen up. maggie: no, i love fun. hold my hand, and, like, we can go in the squat and see how long... lemonis: that's the fun part? maggie: yeah, you're burning calories! can you squat pulse? put your back up, shoulders down. lemonis: no, no, but i'm talking about, like, fun. show me somebody jogging, somebody at cycle class. show the the versatility of it. maggie: got you. man #1: hurry up. hurry up. hurry up. maggie: slide in! man #1: and then go again.

maggie: that was awesome. lemonis: come on, maggie. maggie: i'm so embarrassed of you right now. lemonis: what are you embarrassed for? maggie: i'm embarrassed of you. lemonis: maggie is afraid to do anything outside of her comfort zone. i'm trying to put fun in the shot. ♪ hi, there. how are you? maggie: hi, guys. lemonis: look, if this company is going to grow and we're going to have any chance for success, maggie is going to have to get over her fear of failure. well, guess where i'm going to take her? to the museum of failure. darren: it's a collection of failures from large companies, and the point of the museum is to show that success doesn't happen without failure. lemonis: wait a minute. when did oreos become a bad idea? leila: the idea is that they've innovated a lot, and they've tried all these different flavors, and they're still a huge success, so it's kind of a motivation. lemonis: to say, "try stuff." leila: yeah. maggie: yeah. lemonis: where is it that you try new things? when does that happen? maggie: i'm going to launch five or six new colors for spring, and i don't know if they're going to be perceived well.

lemonis: what about new products? what about selling in the wholesale market? maggie: i want to. i don't want to say no to wholesale. lemonis: what if i told you that you have to totally change your model? maggie: i think i'd say, "i love you." ♪ stephanie: hi. how are you? maggie: i'm good. stephanie: stephanie menkin. nice to meet you. maggie: maggie. nice to meet you. susana: nice to meet you. welcome. lemonis: so the reason that i wanted to get all three of you together is, stephanie runs the entire fashion business for our company, and one of the businesses is susana monaco, somebody that's been through it, that has experience. susana has been in the business for 20-something years. susana: 22. lemonis: susana monaco was a small business that i invested in several years ago, and she's a successful designer that happens to specialize in a very similar material that maggie uses. when i first met susana, she didn't want to change, either, and as she took that leap of faith, she was able to experience success in her business.

and so i thought by putting maggie and susana together, susana would pull her along and say, "look, this is what's happened to me." the number-one reason people don't make it is? stephanie: trust the process. susana: i mean, nothing is easy when you start. you, you know, adapt, and you learn the processes, and you open up to that, and then it gets easier. maggie: right, right. stephanie: you have to make changes to get to change. lemonis: i think there's a way for you to get to the wholesale market, but do it through susana's platform. susana has the opposite of what you have -- very little online business, and she has a ton of wholesale business. and so what i want to task both of you with is, let's pull pieces out. these products that you're picking are going to be marketed as a fusion between the two of you. your name and your name are both going to be on them. what i wanted to have happen between the collaboration of susana and maggie is for each of them to share their ideas with the other brand, and so that if there was top pieces being sold at susana, that maggie may be able to put her own twist on them. conversely, i've been longing for susana

to be in the athleisure business, and if she could learn from what maggie does best with her top-selling skus, she would be able to sell those, as well. it's a sharing of designs, ideas, data to a totally different marketplace. so give me the top sellers in each category, and let's start with that. maggie: this is number one. susana: this, in our world, in tops and dresses, doesn't sell well, as much as that -- lemonis: what are you pointing to? susana: the asymmetric bottom. lemonis: doesn't work? susana: no. maggie: ballet wrap, it's a one-size-fits-all. susana: i don't think it works if we're going straight for the athleisure component of this. maggie: it does really well, and it sells. they want it. like, they're asking me for more. lemonis: in order for maggie to grow her business, she's going to have to listen to the things that susana experienced in her own business. susana will be saying, "i've been here, and my line used to be plain, and in order for you to grow your business, i think you're going to have to really jazz it up." how much of this stuff would sell to your current base the way it is today?

susana: 10%, maybe. lemonis: not much. susana: i don't think it's much because there's too much out there now that's wowing people. lemonis: you're saying this is too flat. susana: i do. i do think it is. lemonis: what do you think needs to be on here to make it work? susana: i would change the fabric and change the color. maggie: what i created, a lot of it was based off of what i wanted, and i like the backs, and the backs sell. stephanie: i feel like you're afraid to change things because you have a certain set of customers. you feel like you've had success enough and that you're afraid to, like, rock the boat. maggie: i honestly have no fear of rocking the boat. lemonis: hearing from me about how maggie should change her designs or change her business is one thing, but hearing from susana, who has 20 years of experience in this same industry, should really change the way maggie is thinking. so this is the start of the collab? stephanie: this is it. lemonis: it needs to get tweaked. you need to go over everything, and then we need to weave in the susana monaco stuff. susana: yeah. stephanie: agree. maggie: mm-hmm. ♪

lemonis: hello. maggie: hi. lemonis: i wanted to check in on how the designs were working for the flywheel pitch, so i asked maggie to bring some of the garments over to my office in los angeles. so the meeting with flywheel is next monday. i'm super nervous about taking product somewhere that i haven't even seen. maggie: yeah. no, i know. i've been working on it, and i want to show you some stuff that i have put on. lemonis: okay. maggie: okay, so flywheel -- i'm going to take you through over here. put the logo on. we got the logo, and then we made -- lemonis: from them? maggie: we made the heat transfer. that's the only logo we got, so... if it was my choice, i wouldn't have put the logo on anything. i know that, in my friends, we don't wear logos. we just don't. lemonis: okay. i thought it was a little odd that maggie was resisting putting the logo on the garments, and i would understand that if it was her own brand, but we're doing a presentation specifically for flywheel. can i see something fun?

maggie: so i kind of just put stuff down, and these are all words that kind of describe me, and then i kind of got a little cheeky. lemonis: okay. maggie: "no, thank you." my niece, she's 3, and she says, "no, thank you," to everything. lemonis: okay. maggie: and i wanted to use those words and put them in little places on the garment. "kinda classy, kinda hood." "side-boob friendly," because a lot of the bras show it. "i wear black." "pinky out." cutouts for extra ventilation. lemonis: i appreciate that maggie is trying to be innovative, but cutting a hole in something for ventilation isn't what i would exactly call riveting and game changing. maggie: we played with this -- also a heat transfer. i can make it look much better with digital embroidery. lemonis: i don't love the font. it's very cartoonish. maggie: look on the inside. "got you, girl." it's an inside pocket. lemonis: i don't think there's anything special about this. maggie had the opportunity to use lyrics and graphics from some of the best artists ever in music, and instead, she puts on something that looks like it came from a grade-schooler.

juli: well, and it's such a cute phrase for the inside pocket. like, "i got you, girl. i'll hold on to your whatever." maggie: because that's where they put their -- your credit card. lemonis: honestly, if that's all we're taking, then we shouldn't go yet. maggie: i see going to market separately. susana: i thought the whole idea was that we were going to add to the collection, to sell a collection. lemonis: it was, but i'm just trying to figure out when the [bleep] that's going to happen.

we shouldn't go yet. i wouldn't take any of that. none of it. like, i don't even want to have the meeting monday. maggie: really? lemonis: yeah, because it doesn't feel special to me. juli: we thought to play it safe to not offend them, and then we can -- lemonis: i know, and i don't want you to play it safe ever. and if the other person doesn't care for it, then maybe it's not a good fit for montiel. what i would have done a little differently, i probably would have created a line that was specifically for them, not took our core products and put their logo on it. maggie: right. lemonis: we need to work on it over the weekend. maggie: yeah, big time. lemonis: cool. maggie: yeah. lemonis: okay. i'll see you in new york. maggie: see you in new york. juli: thank you. ♪ lemonis: with the flywheel pitch just around the corner, maggie is working on her presentation and making final little tweaks to her pieces. and while the flywheel prototypes are in production, i'm taking maggie to century packaging in order to elevate the customer experience. frank: so we do everything from start to finish. we print, die cut, and glue. we actually do the graphics here, as well.

maggie: oh, i like that. lemonis: the goal is to ensure that every time a customer buys something online from montiel, they're getting something special. maggie: i mean, these type of items sell the best. it's loungewear kind of. lemonis: maggie is also working on her collaboration with susana monaco. maggie: i like the shape. i like how it fits the waistline. susana: it's really mediocre. sorry, no offense. maggie: thank you. lemonis: but things aren't going as smoothly as i had hoped. ♪ it's been 3 weeks since i first put susana and maggie together, and i still haven't seen a single piece from the collab line, so i'm bringing maggie to susana's showroom in new york to get the real story. i thought maybe we could just get a summary since the last time we saw each other, what you guys have gotten done together. susana: well, we sent maggie some samples from ours. we went over prices and margins to see where we can meet in the middle.

lemonis: i was thinking she would take your top-selling pieces, put her twist of them, make some changes to it. maggie: that is what it was. when she left my office in l.a., i picked two things from her collection that would work. susana: we have a library filled with stuff that can work. maggie: yeah. susana: i mean, what you've seen is not much. lemonis: what the [bleep] are we doing? i'm not going to lie. i'm disappointed that maggie admitted to me that she hasn't even looked up any of susana's top sellers. while maggie is soft-spoken and very nice, she hasn't actually done a thing, and her resistance to change, it's more pronounced than ever. what the [bleep] is happening right now? like, i don't understand what's happening. stephanie: she was like, "it doesn't work," and then they gave up. that's what happened. say, "yes, that's what happened," because that is what happened. lemonis: go through the whole... maggie: i will. i'll just go all the way around. lemonis: all the way this way and all the way -- and just put here what works. maggie: okay. ♪ nope. lemonis: okay.

maggie: let me see that one. lemonis: yes or no? maggie: it's too long. lemonis: maggie? maggie: no. lemonis: maggie? maggie: i don't -- no. lemonis: what about this? maggie: the v. lemonis: you don't like the v? maggie: i don't like the v. lemonis: you guys found nothing else in this whole thing? maggie: nothing. lemonis: what is this? maggie: that would be hard for me to sell because it's too -- too basic. i see going to market separately. susana: i thought the whole idea was that we were going to add to the collection, to sell a collection. lemonis: it was, but i'm just trying to figure out when the [bleep] that's going to happen. tara: i think we have to capture more of flywheel in the overall design approach. sarah: i do think the product, like, needs work.

susana: i thought the whole idea was that we were going to add to the collection, to sell a collection. lemonis: it was, but i'm just trying to figure out when the [bleep] that's going to happen. i haven't asked maggie to do anything revolutionary. i wanted her to collaborate with susana so that we could all make some money, and in my opinion, the lack of even making the effort is a giant fail. was this idea of having them work together a mistake? i think that the two of you need to do what you do best and not try to do something that you don't do. susana, you have not had the time,

the energy, or the resources to dedicate to the website. susana: not full force. lemonis: she knows online. i would argue that she should run the two websites and you should run the wholesale community, and so why not just put everybody in what they're best? i think the two of you have your own look and your own opinion and your own appeal, and we just want to keep that separated. and so, i would learn how to lean on each other. from here, they're going to have to look at this partnership differently. despite the fact that they don't want to design together, they can still help each other generate revenue. maggie is brilliant in online marketing and social media and using those outlets to sell directly to customers. susana knows the wholesale market and how to sell direct to boutiques across the country. they could still learn a lot from each other, but both of them have to be open to it. put your worlds together and figure it out. ♪ how are you feeling? maggie: a bit nervous. lemonis: today is the big pitch at flywheel.

i would really wow her with, like, a real fine knowledge of every square inch is money. it's going to be paramount for maggie to differentiate her products from what flywheel already sells. you have to be prepared for them to say something like, "well, this stuff sells." i just hope that she's taken her line far enough for them to see that. sarah: hi. juli: hi. i'm juli. sarah: i'm sarah. juli: nice to meet you. lemonis: hello, everybody. good to see you. so i'm going to turn it over to maggie. maggie: well, my thoughts for you and what i want to create for you is a totally different line using my pieces, but we're going to call it fly girl. sarah: really cute. maggie: "you're even flyer than you think. you're challenging. you're intensely fun. you're not like anyone else." these are kind of the words that i think represent myself, and i think they represent a lot of women that i know and, i think, represent you. we'll go through some of the product. here are some hoodies. we have that hoodie that comes longer. tara: my one comment would be, it's a touch bouncy.

i wish it had a little more -- not want to use the word "substance," but just a touch more. maggie: okay. tara: and the tops are almost like our billboard for fly because that's where we can put a logo to, again, marry the two and to tease a functional product, as well as marketing for the brand and being a part of our family. maggie: this is what i don't want to do. every time i see something like a big logo like that, i just know that's going to sit on the rack longer. tara: but i think we have to use the fly logo because our fly family, whether it's employees, instructors, riders, everyone that's coming in wants to feel a part of the brand identity. and no mesh on this one? maggie: no mesh, but look on the inside pocket. we put a little, "got you, girl"... tara: nice. maggie: ...which will actually go on the inside of that. tara: okay. and more of a high waist on the bike? maggie: yeah. this is a high-waisted one. tara: okay, great. maggie: so, thoughts so far? michael: there's a lot for us to think about. lemonis: for exclusives, extras, and business advice,

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maggie: so, thoughts so far? tara: i think your approach was maybe too soft. it's not really representing the feeling that we are getting that performance result. lemonis: i told her that it looks like the words and the embellishments were too soft. she didn't make enough changes. tara: i think we have to capture more of flywheel in the overall design approach. maggie: mm-hmm. tara: i think from where we are, she's a little fiercer. maggie: yeah. tara: she's a little more bold. sarah: i do think the product, like, needs work,

like, just to take it up a notch to a level that's just more iconic and memorable. lemonis: thank you so much. sarah: yeah, thayou. tara: thank you. lemonis: thank you so much. thank you for taking the time. maggie: thank you. i really appreciate it. lemonis: what they're really looking for are new, innovative things, new products, new graphics, new designs. yeah, what i've been telling her the whole time. if she would have just listened to me a little bit and thought outside of the box, we'd at least be walking away with something. now we're walking away with literalnothing. ♪ ♪ maggie. maggie: marcus. lemonis: what's happening? maggie: hi. how are you? lemonis: how are you? everything good? maggie: yeah. lemonis: i'm heading in to see maggie's final maggie line, her reveal of all the changes and things that she's done, and if i don't see something revolutionary, to be totally candid with you,

it's going to be three strikes, and you're out. maggie: so i was going to show you on a laptop, but i figured i'd print all of this out because it's easier to see. this was for you. lemonis: that was for me or for you? maggie: for you. i think of the maggie line as an extension of me, and i don't think that that necessarily represents me. lemonis: maggie didn't even have the courtesy to bring actual garments to me or to change anything, not even the poses that the models were in, the color palette that was used. it was almost like she sabotaged it on purpose. maggie: i wouldn't wear it, personally, but i know my customers would. lemonis: it is ironic to me that you say, "my customers would all buy this, but i just don't like it." maggie: i don't think i would take anything all the way to production if i'm not going to be happy with it. lemonis: which is why i'm looking at pictures and not product. i think you have zero interest in changing anything. it's sort of like banging my head against the wall, and even asking you to try things didn't even work.

maggie: i couldn't agree more. seriously, i mean, i'm trying to think, and i'm trying to make sense of, like, "okay, i'm giving him, you know, 45% of my company to someone where i don't feel like i'm going to benefit from." lemonis: i'm not going to lie to you. i have a little bit of frustration that you wasted my time. i feel like you strung me along, and you didn't see value in the relationship. maggie: what i've seen is, like, with the flywheel, you know, when that didn't go through, it's like, "okay, that didn't go through." lemonis: it didn't go through because you didn't make anything different. maggie: yeah. lemonis: and it was the same with susana. what i was going to see today was going to tell me if you really wanted to move forward or not, and the fact that you didn't even go try to silk screen something or print something... maggie: i was kind of hoping for something to happen to where i... lemonis: yeah, me, too. maggie: ...felt like, "wow, this is going to grow my business." lemonis: maggie, you didn't trust the process, and my process is getting you to try things to open up your mind. maggie: yep. lemonis: i feel like, in your own way, you gave me "f you"s along the way.

essentially said, "yeah, i'm not going to do any of this stuff," rather than regurgitating all the things that didn't work, like flywheel, like lua + sol, like susana, like coming up with new products. really, none of that happened, and you just didn't buy off on it. and you should have just told me that, like, a month ago. i feel like i kind of wasted a lot of my time. maggie: i'm sorry. no, because i, you know, i obviously have so much respect for you. lemonis: look, i wish nothing but the best for maggie, but i don't think she ever really wanted a partner. i wish you a lot of luck. maggie: you, too. lemonis: i'm sorry it didn't work out. we either have revolutionary, innovative designs that are going to be cutting edge against the competition, or you're going to get swallowed and spit out by the competition, and i don't want my money or my reputation being a part of that. ♪ ♪

♪ welcome to "street signs" i'm joumanna ber shech chi. >> chinese stocks higher as investors eyed the resumption of trade talks in beijing. but another government shutdown looms in washington after negotiations over border security spending stall as democrats and republicans clash over immigration rules italian bank stocks rally after the ecb sets capital