Is Shop Jeen's Viral Success Story All Window Dressing?

For a certain type of internet-fluent teenager, Shop Jeen is an unsurpassed mecca of cool. The retailer’s homepage looks as if a sex-crazed Hello Kitty threw up after drinking 1,000 jello shots, selling things like “Turnt Jesus” iPhone cases, “University of Bad Bitches” sweatshirts and T-shirts screaming “Ask Your Boyfriend How My Ass Taste.” It’s irreverent and exceptionally topical, a store for young women who don’t buy clothes as much as they buy costumes. But it is also, by many accounts, a black hole of dysfunction: money goes in, but very little comes out.

On August 13, The Cut published an exceedingly positive article about Erin Yogasundram, the 23-year-old CEO of the internet teen-focused retailer. The website isn’t the only one to do so. People are obsessed with Yogasundram: users of the site call her “Mom,” MTV recently referred to her as “Queen Bee of the Internet,” and Racked included her in a series of interviews with women who are “killing it in the fashion-tech industry.”

The article paints Yogasundram as an ambitious, perpetually on-trend chick who found fun, cool success and is now dealing with its slightly less fun, less cool consequences:

Product wasn’t being tracked properly, people weren’t getting their orders on time — basically, there were no official protocols in place. “We wanted to use this as an opportunity to really do things right, lay out processes, and build it back up from day one,” Erin says. She admits that she’s not a great manager. “It’s my weakest point. I’ve literally only been alive for 23 years.”

The rest of the piece mentions a few other blips the company has had (Chanel sued Shop Jeen for selling knock-off iPhone cases; Yogasundram and her business partner had to lay off ten of their 15 employees), but mainly focuses on her rising star.

The company’s successes, to be sure, are impressive—the brand has an enormous web footprint, with over 400,000 Instagram followers and 60,000 Facebook likes. Yogasundram says she made $50,000 in her first month, a number that has likely only skyrocketed since she founded the company in 2012. This type of rapid success would pose a challenge to any CEO, let alone one who’s 23 with no real business experience. But the troubles Shop Jeen is facing aren’t just the usual bumps that come along with building a brand, nor are they the minor hiccups glossed over in the Cut profile. Rather, according to people who have interacted closely with the company, Shop Jeen’s troubles appear to be the result of legitimate misconduct within an environment of little-to-no accountability. Many ex-employees and vendors portray Yogasundram’s business as distinctly unprofessional; they say her style of management is avoidant, irresponsible and dysfunctional behind the scenes.

Jenna Bumgardner is the owner of Space Trash, a jewelry Etsy shop that worked as a vendor for Shop Jeen for several months. During that time, Bumgardner alleges the company was often late on their payments, if generally never more than a week or two; it didn’t seem worthwhile to make the delays a thing, she says.

Then the delays got worse. Bumgardner finally reached out to Jezebel after waiting over 100 days for almost $900. Yogasundram had ignored her repeated requests for payment, until Bumgardner threatened to bring her to small-claims court. At that point, Yogasundram finally responded that she would withhold an employee’s paycheck to foot the bill.

In another email to Bumgardner (provided via screen grab to Jezebel), Yogasundram wrote:

I’m sort of baffled that you think we are intentionally withholding money from you and that it would be beneficial for us not to pay you. We’ve always paid in the past, much larger bills at that- not sure why we would decide to all of a sudden not be able to unless there was an actual legitimate problem with being able to do so.

Also sad to see your posts all over the internet about how we are STEALING from you. That’s hardly what is happening here. I flew to New York to close up our office there since we can no longer afford to have it and we were given free tickets to the VMAs…that isn’t something you pay for.

But to avoid continuing this extremely stressful and anxiety inducing conversation over $800, I am going to call my dad whom I barely speak to and ask to borrow it to pay you since asking an employee to withhold a paycheck does not suffice. I am concerned about you continuing to act irrationally on a public forum.

“She’s really trying to make us feel like the bad ones [for having asked for payment],” Bumgardner wrote in response in an email to Jezebel. “Honestly I do feel bad because I am a nice, patient person… but I have rent to pay, a cat and dog to feed, and a boyfriend who is struggling with student loan debt. My business partner can’t even afford to pay rent, and still lives with his parents while he attends community college.”

Yogasundram argued in an email that her intentions were good:

“My offer to compensate her personally and from outside the business was a gesture that was meant to show that I was willing to do whatever was necessary to make her whole; it is in an issue that has now been resolved definitively.”

Bumgarner threatened legal action against Shop Jeen if she received no payment by August 31. She was finally paid, she tells Jezebel, the afternoon of September 1.

But she was one of the persistent ones, somebody who had the time to threaten legal action and to hound Yogasundram every day until she relented. Jamie Glassberg, Vice President of Top Trenz, Inc., tells Jezebel he’s had similar, repeated experiences of nonpayment from Shop Jeen. But he hasn’t threatened to sue, and hasn’t gotten any substantive response from Shop Jeen management.

Glassberg first met Shop Jeen representatives at a trade show in 2014. At another show in March 2015, the company put in a sizable order for a number of Top Trenz’s candy-print accessories, but asked for time to pay it off. Since Shop Jeen had such a huge social media following, Glassberg and his colleagues agreed.

But, when it came time to pay the bill, nothing happened. After Glassberg found himself in repeated conversations with Shop Jeen’s buyer, it became clear to him that Top Trenz was not the only stiffed vendor. “[The Shop Jeen buyer] was like, ‘Yeah, I’m really upset. My name’s getting smeared here. All the vendors that I buy from, none of you guys are getting paid and it’s hurting my reputation,’” Glassberg said.

In June 2015, the buyer was let go, along with ten other employees in advance of the company’s big move out west. Shortly after they were fired, Glassberg saw a call for applications to work at the retailer: Shop Jeen was hiring again. Currently, Shop Jeen’s jobs board lists eight open positions, as well as a call for interns.

(Yogasundram claims that the issue with Top Trenz is “being worked out with our accounting team” and that she has had “multiple exchanges” with Glassberg.)

The buyer in question, who wishes to remain anonymous, confirmed Glassberg’s story, suggesting that the company got itself into trouble “shortly after Black Friday” in 2014, when Yogasundram “decided to stock the site with product we didn’t actually have quantity on, in an effort to maximize sales.” Customers placed orders that Shop Jeen knew it couldn’t fulfill, and the complaints and subsequent problems became an “avalanche” for the buyer, who was the vendors’ main point of contact.

The former buyer noted that the company worked on Net 30 terms, in which Shop Jeen pays a given vendor 30 days after their wholesale goods are received. “[Yogasundram] very rarely had any intention whatsoever on paying vendors on time. Unless of course it was in her favor to do so, as in to clear balance for another order.”

Whether or not it was Yogasundram’s initial intention to stiff her vendors, such a move quickly became an acceptable solution to the company’s ongoing financial problems.

“She exhibited a complete lack of moral compass, screwing over vendors both large and small,” the buyer continued. “At the time that I was let go, the vendor debt was six figures with over 20 vendors.”

Yogasundram denies that this is still the case: “Shop Jeen has gone through pretty standard restructuring which has included a new, streamlined accounting framework, new priorities with regards to staffing our team and a new geographic location. As young entrepreneurs, we are improving our practices every day, but I can say confidently that all our vendors have been fully recompensed.”

The buyer noted that Shop Jeen staff was as unhappy as the vendors they were disappointing.

“[Yogasundram] rarely graced us with her presence and preferred to manage and give input via email or Slack… where she was rude, insensitive, and unrealistically demanding,” the employee wrote. “Occasionally she would try to inspire us with long-winded emails sent to everyone or (even more rare) an in-person talk where she would dish out empty promises on a myriad of things such as benefits, vacation plans, employee discounts, and improved office equipment/furniture. All things she never made good on.”

The source said that eventually, several employees’ checks bounced, an inevitability that Yogasundram reportedly claimed was beyond her control.

Kacie Medeiros was hired to be the Customer Service Lead this past January, shortly after leaving a job at Burberry, according to her LinkedIn profile. Upon arrival, she learned that she was the only customer service rep at the company—the others had quit.

“I generally enjoyed my time at the company due to my coworkers,” she said in an email. “Having said that, it was not well organized and it was very difficult to [do] my job well due largely to internal issues such as money and lack of communication from management.”

Medeiros noticed that the company was troubled basically as soon as he got there

“Sorry to be blunt,” she continued, “Erin was not a good boss. She was very distant and awkward. I never felt comfortable expressing problems I saw with her. Nor did I feel she was open to any suggestions from any of my coworkers.”

“At one point I saw a Snapchat of our creative director rolling her eyes while I was clearly speaking in the background,” she wrote.

One day in June, Medeiros recounted, every employee was let go without notice. “One by one we were told we were being let go or temporarily asked to stay on ‘till they could be fully located to LA.”

Reviews on Glassdoor.com echo these reports, alleging that Yogasundram was frequently absent from the office and is “disrespectful of her current employees, demand[ing] extra weekend/holiday work from them without appropriate compensation.” The reviewer adds that Shop Jeen employees receive no benefits and poor pay.

“Like most CEOs, I work 20 hour days and routinely pull all-nighters, so the idea that I was not a consistent presence in the office is misleading at best,” Yogasundram countered. “Just yesterday I worked very hard from 8 a.m. to 12:30 a.m. nonstop.”

The company currently has an F rating on Better Business Bureau, with over 50 registered complaints claiming that products were never delivered, but no refund was granted despite numerous attempts to get in touch. Others claim that, when products were delivered, they were damaged to the point of being unwearable. One customer writes about receiving an email that an ordered item was “unable to be packed” and that the company did not send a refund but said they were “SO sorry.” Another customer writes about an order sent with a false tracking number—an item that never arrived. “This business is a fraud,” the customer writes.

Another website features what seem to be screen grabbed posts on the Shop Jeen Facebook page (that may have since been deleted), complaining about orders that were never received and refunds that were never given.

Medeiros says she received similar complaints “all day every day.”

“When I started there were about 5,000 emails or so that needed to be resolved,” she wrote, “not really due to bad service, but more not being allowed to answer them via Erin’s guidelines… We all did what we could.”

But these are all things to be expected from a rapidly growing company, Yogasundram insists.

“Our customer service team is working hard to respond to all order issues that transpired during our move from coast to coast,” Yogasundram said in an email. “Traditional growing pains that a young, start-up, boot-strapped business faces can be challenging and we are doing everything we can to have our operations running smoothly again.”

She added: “Shop Jeen received over 50,000 orders over the holiday season. During that time, we were a team of six people and our business literally quadrupled with volume that could not be anticipated. Kacie and a team of two others were brought on after to help go through and fulfill a backlog of 3,000 customer inquiries.”

Yogasundram told The Cut: “I think that the angle for the story is how I’m this emotional 23-year-old girl, yet I have to combat these crazy 50-year-old-CEO work problems.” Her youth, a major asset for the company’s ability to capitalize teen-focused trends, is also undeniably a factor in her workplace difficulties. However, there’s plenty of precedent for a 23-year-old to negotiate the business world successfully, and paying people on time is not necessarily an obligation that grows clearer with age.

Glassberg, the VP of Top Trenz, stated things more plainly. “I see this and I’m just like, wow. The guys are scam artists. This girl just doesn’t care. People are dumb enough to give them credit and she’s just not paying her bills. What are you gonna do? Are you gonna go there and beat her up? There’s nothing to do.”

Yogasundram agrees with Glassberg in the sense that there isn’t really anything to do about the business hiccups other than wait them out:

“I’m a 23-year-old woman with a business that I have boot-strapped completely, taking no outside investment to this date,” she wrote to Jezebel, although the New York Magazine article notes she has received private loans. “Anyone who has ever operated a small business understands that managing vendor and customer obligations is a core concern, and one that we have addressed in our recent restructuring which we are confident will improve our operation.”

“Immense growth can be a blessing but also a tremendous challenge,” she continued. “We wholeheartedly appreciate the support from our customers and vendors as we adjust some of our practices and mature as a company. We are very excited for the future.”