Sara Blakely Started Spanx With $5,000

The problem was a pair of white pants. Sara Blakely, then in her late twenties and selling fax machines door to door in Florida, had bought them and couldn’t wear them. Everything she put underneath showed through: lines, seams, bulges. Pantyhose smoothed things out, but she didn’t want the feet in her open-toed shoes.

So she took a pair of scissors and cut the feet off her control-top pantyhose. The result looked right, and she had the idea and she would build a company worth more than a billion dollars on it.

The fax machine years

Blakely’s day job was the best business school she had. For seven years she sold fax machines for an office supply company called Danka, cold-calling offices and knocking on doors. Most of the answers were no, often delivered rudely. It was hard work, and it taught her how to keep asking.

It also gave her savings. By the time she decided to make the footless hose into a product, she had $5,000.

That was all the capital Spanx would ever raise from her. “I started it with five grand from selling fax machines and self-funded the entire 21 years,” she told an audience in remarks reported by Fortune in 2025.

Spending $5,000 carefully

Five thousand dollars doesn’t go far in clothing. Blakely decided to spend it where she had no alternative and do everything else herself.

Patent lawyers were expensive, so she wrote her own patent. Blackstone’s account of the company’s founding, published when its deal was completed, says she “wrote her own patent and invented the first SPANX undergarment in her apartment.” She learned patent law from a book she bought in a bookstore, which she said saved her about $3,000 in legal fees. She chose the name herself too, a made-up word whose spelling she changed to end in an x at the last minute, after reading that invented names sold better.

She needed a factory, and the hosiery mills she approached turned her down. Eventually one, Highland Mills in Charlotte, North Carolina, agreed to make her prototypes.

Ten minutes in Dallas

The breakthrough came from the skill she had learned at Danka. Blakely kept calling the hosiery buyer at Neiman Marcus until she agreed to a meeting. According to Fortune, she was given ten minutes and had to pay her own flight from Atlanta to Dallas to get them.

Halfway through, she asked the buyer to come with her to the ladies’ room. There she changed into the product, before and after, so the buyer could see the difference for herself. Neiman Marcus ordered Spanx for seven stores. Bloomingdale’s, Saks and Bergdorf Goodman followed.

Blakely was not leaving the result to chance. She later admitted, in Fortune’s telling, that she asked friends to go into Neiman Marcus and buy the product so the first order wouldn’t flop.

Spanx launched from Atlanta in 2000. That November, it appeared in “Oprah’s Favorite Things,” the annual list on Oprah Winfrey’s television show. Demand jumped.

The economics of owning everything

Here the money story becomes unusual. Most consumer brands that grow fast take venture capital or private equity along the way, trading pieces of the company for cash. Spanx didn’t. Blakely owned it outright, and the company paid for its own growth.

The numbers were big enough to do that. Sales were $4 million in the first year and $10 million in the second. In 2012 Forbes reported that Spanx had revenue just under $250 million and net margins of about 20%. Blakely owned 100% of it, it had no debt, it had never taken outside money and it had never paid for advertising. Forbes put her on the cover and on its billionaires list, at 41, as the youngest self-made woman ever to appear there.

The free publicity did the work advertising would have done. Spanx grew from one product into more than 200, sold in about 11,000 stores in 40 countries, TIME reported that year, when it named her one of the 100 most influential people in the world. In 2012 Spanx also opened its first stand-alone stores, in shopping malls on the East Coast.

The cost of control was slower growth than outside money might have paid for. The benefit was that every dollar of value the company created stayed with its founder.

The $1.2 billion deal

In 2021, after more than twenty years, Blakely finally brought in outside capital. On October 20 Spanx announced that funds managed by Blackstone would buy a majority stake in a deal that valued the company at $1.2 billion. The deal team at Blackstone was all women. Blakely kept a significant stake and became executive chair.

She celebrated in a way that went viral: every Spanx employee received $10,000 and two first-class plane tickets.

Do the arithmetic on the original investment. Five thousand dollars in 2000 became a company valued at $1.2 billion in 2021.

What the record shows

• Ownership is the multiplier. Plenty of founders build billion-dollar companies. Few still own all of it when it gets there. Blakely’s refusal to raise money is why the valuation became personal wealth.
• Cash goes where you can’t substitute effort. She paid for prototypes and product. She wrote the patent, made the calls and did the sales herself.
• A demonstration beats a pitch. The deal that launched Spanx was made in a restroom, with the product on.
• Rejection is training. Seven years of slammed doors selling fax machines made a ten-minute meeting in Dallas easy.

The thread runs through other stories in this archive. Huy Fong Foods built a hot sauce business without spending on advertising. Brownie Wise sold Tupperware by showing it in living rooms rather than shop windows. In each case the founder sold the product by putting it in front of people.