Feb 20, 2017 · 29m · how-i-built-this
Crate & Barrel: Gordon Segal
0:00 / 0:00
gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
Gordon Segal recounts the entrepreneurial journey of co-founding Crate & Barrel with his wife Carol, explaining how they built a multi-billion-dollar housewares empire by importing affordable European-designed furnishings and taking high-stakes, self-funded risks.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Guy holds 34.3% of the talking time here. How this is scored →
Guy as informed peer 2.7 Guest teaching 2.9 Guest disagreement 0.1 Guy pushing back 0.3
speaking balance: gold is Guy, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 23:40 Playful pushback on customer product durability
When Raz shares that he has used the same Crate and Barrel dinnerware for two decades, Segal humorously laments the business problem of products lasting too long instead of being replaced every few years.
Hardest push from Guy ▶ 16:13 Raz presses on the systemic risk of leveraged growthRaz challenges Segal on expanding exclusively via bank loans, questioning whether each new store placed the entire enterprise at risk of total failure.
Biggest teaching moment ▶ 12:11 Segal contextualizes the 1960s culinary revolutionSegal educates Raz on the historical backdrop of 1960s America, explaining how French cuisine, Julia Child, and transatlantic jet travel created the appetite for modern kitchenware.
Guy holds their own ▶ 17:36 Raz demonstrates store count timeline masteryRaz demonstrates precise command of company history by contrasting Crate and Barrel's 25-year slow rollout to 17 stores with its sudden tripling to 60 stores by 1995.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Guy as informed peer | Guest teaching | Guest disagreement | Guy pushing back | Why |
|---|---|---|---|---|---|---|
| Honeymoon Inspiration and the Core Idea | 2 | 2 | 0 | 0 | Guy Raz sets the narrative stage and asks open-ended questions about how Gordon and Carol conceived Crate and Barrel during their Caribbean honeymoon. Segal collaboratively shares the founding story and their direct-import retail thesis. | |
| Trade Commissioners and Securing the First Location | 2 | 3 | 0 | 0 | Segal explains their unconventional process of contacting foreign trade commissioners and DIY-fitting an old elevator factory. Raz reacts with astonishment and curiosity as Segal outlines their bootstrapping tactics. | |
| Opening Day, Winter Slump, and Pricing Mishaps | 1 | 4 | 0 | 1 | Segal describes their opening days, brutal winter sales drop, and naive pricing mistakes where goods were sold at cost. Raz acts as an amused listener prompting Segal to explain how they survived mispricing inventory. | |
| Mid-Show Station Break and Promo | 3 | 5 | 0 | 0 | After the mid-show break, Segal educates Raz on the socio-cultural shifts in 1960s America—specifically the rise of Julia Child, jet travel, and dining culture—that catalyzed demand for European housewares. | |
| First European Sourcing Trips and Mentorship | 2 | 3 | 0 | 0 | Raz asks how European factory owners received two young Americans in their twenties. Segal shares anecdotes of mentorship from European designers and studying retail display aesthetics abroad. | |
| Self-Funded Growth, Risk, and Michigan Avenue | 4 | 2 | 0 | 1 | Raz presses Segal on the financial danger of expanding without equity, prompting Segal to validate that opening each subsequent store literally meant betting the entire company. | |
| Scaling Operations and Mall Landlord Partnerships | 5 | 3 | 0 | 1 | Raz demonstrates research by citing specific historical milestones—noting the jump from 17 stores in 1985 to 60 by 1995. Segal explains how mall developer subsidies and the Otto Group acquisition altered their expansion model. | |
| Career Advice, Product Durability, and Company Culture | 3 | 2 | 1 | 0 | Segal provides entrepreneurial philosophy regarding intrinsic passion versus chasing wealth. Raz shares a personal anecdote about his 20-year-old Crate and Barrel plates, prompting a playful contrarian quip from Segal about durable goods curbing repeat sales. | |
| Host Outro and Update on Gordon Segal | 2 | 2 | 0 | 0 | Raz delivers the outro for Segal's story and transitions into the 'How You Built That' segment featuring Alec Avedesian of Rareform, who explains repurposing billboard vinyl into bags. |
Statements from this episode (11)
Segal: Direct European importing enables significantly lower retail pricing for unique goods
“Obviously, the motivation of going into business was to find beautiful things for other young people, but if we could buy things from Europe directly and just mark them up normally as if you bought them domestically, not take a big margin, but take a short mar…”
Gordon Segal failed to sell 50% of Crate & Barrel for $10,000
“And I spent six months running around to everyone I knew who had any wealth and offering them half the business for 10,000 dollars.
There was no such thing as venture capital in those days.
There was no such things as startups in those days.
Yeah.
And I litera…”
Segal: Youth and lack of wisdom are great advantages for entrepreneurs
“I mean, the value of being very young is you have a lot of energy and passion and no wisdom.
And so being that young was a great advantage, and we had no children.”
Segal: Crate & Barrel sold half its initial inventory at cost
“And we had ended up, because we didn't know how to price merchandise, about half the product we sold at cost.”
Segal: Every store opened from 1962 to 1971 was a bet-the-company risk
“Every store we opened between our opening in 62, our first built store in 65, our Plaza de Lago store in 68 our Oak Brook store in 71, every time was betting the company.”
Gordon Segal: Crate & Barrel needed massive scale for exclusive distribution
“Well, we reached a different era where it was important to have scale to do the things we had to do with buying merchandise. So you had a guarantee to a factory you'd buy a certain amount of a product to make sure we were the only people in the United States t…”
Gordon Segal: Crate & Barrel's 1990 flagship made them a mall anchor
“In 1990, we built a flagship store in Chicago, which really helped launch our expansion because then every landlord, every shopping mall wanted a crate and barrel building. And we were a big attraction because we drew in a lot of customers. And what happened s…”
Segal: Crate & Barrel sold two-thirds stake to Otto Group in 1998
“In 98, we sold them about two thirds of the company. And 10 years later, and the contract was for 10 years, we sold them the rest of the third.”
Segal: Crate & Barrel tripled size and quintupled profits post-acquisition
“And our success was we tripled the size of the company, we quintupled the profits of the company, and we were able to grow.”