The World’s Most Anonymous CEO Is About to Take Center Stage | Mint

The World’s Most Anonymous CEO Is About to Take Center Stage

Shein CEO Sky Xu is so far under the radar that even many of his own employees have no idea what he looks like. ZE OTAVIO
Shein CEO Sky Xu is so far under the radar that even many of his own employees have no idea what he looks like. ZE OTAVIO

Summary

The founder of fast-fashion juggernaut Shein has managed to stay out of the spotlight despite his company’s meteoric rise. With an IPO looming, he likely won’t remain under the radar for much longer.

When employees at fashion giant Shein crowded into an elevator in the company’s Guangzhou office at the end of one workday this summer, no one took notice of Sky Xu.

The quiet man in the corner was one of the wealthiest people in China, the driving force behind an app that has quickly become one of the top shopping destinations in the world—and the boss of everyone riding the elevator.

With Xu that day was Frances Townsend, a senior adviser to Shein. When they left the building, she said to him she was amazed that the workers didn’t seem to recognize their chief executive. Xu responded matter-of-factly: “That’s not our culture."

Shein’s employees aren’t the only ones who don’t know who Xu is.

One widely used photo in Chinese-language articles about him is actually of another entrepreneur with the same surname. Reports in international media outlets have given his English name as Chris. Xu, whose Chinese name is Xu Yangtian, has sometimes gone along with it, even signing a company report on sustainability as Chris Xu last year. The company has since made clear he goes by Sky Xu.

The company Xu built from scratch has won over tens of millions of young shoppers in the U.S., Europe and Latin America with its ultra-affordable trendy clothing. Now, Shein is preparing for an initial public offering in the U.S. The listing could be one of the biggest IPOs in years, and it will push Xu onto the global stage.

Investors often expect CEOs to be the face of their companies when they go public and afterward, communicating their strategic plans, painting their vision for the future and answering to shareholders. Xu may no longer have the luxury of being anonymous.

Xu grew up in Zibo, a hardscrabble industrial city in Shandong province. His parents were both factory workers.

In the early 2000s, when he was studying international trade at Qingdao University of Science and Technology in Qingdao, a port city 165 miles away from his hometown, he embarked on a side project. He taught himself search-engine optimization, bought a number of domains and built an online business brokering China-made industrial products like gaskets with foreign buyers.

He learned the importance of building relationships with small factories and sourcing only what he knew he could sell, not buying a large inventory upfront. He later took this early insight to an enormous scale with Shein.

In 2008, he and a partner jointly funded Dianwei Information Technology, an e-commerce outfit.

A year later, Xu left to start a new online business with three other partners to sell consumer products abroad. Their offerings ranged from purple clay teapots to eyeglasses. After a few years of trial-and-error, the partners decided to focus on wedding gowns, naming the website SheInside in 2012.

In 2015, Xu and his co-founders—Molly Miao, Maggie Gu and Henry Ren—expanded SheInside’s offerings from wedding dresses to other clothes for women, shortened the site’s name to Shein and launched its namesake app. The platform in a few short years became one the most-downloaded shopping apps in the world.

Under Xu’s leadership, Shein has pioneered a hyper efficient supply chain that uses algorithms to swiftly predict customer demand and cater to their preferences. It places orders in small quantities to test the market appetite and replenish orders on demand. This model ensures Shein can pump out thousands of new styles every day and sell most of what it has made: Shein says only 2% of its clothing is unsold, far below the industry average of 30%.

In recent years, Shein has sought to build a non-Chinese identity. It has moved headquarters to Singapore and has been building supply chains outside China. The company has been criticized for alleged copyright infringement and for the impact its “fast-fashion" business model and plastic packaging have on the environment. U.S. politicians have pressed the SEC to investigate the origins of the cotton in Shein’s textile products and whether it relies on forced labor in China’s Xinjiang region. (Since 2022, U.S. law largely bans the import of goods tied to Xinjiang.) Shein has also been accused of taking advantage of a U.S. tax rule to evade import taxes and scrutiny.

The company says it has “zero tolerance" for forced labor and complies with laws in the markets where it operates. It also has said that it’s developed a design review team to prevent copyright theft and partnered with an outside company to buy up the surplus material of other brands to avoid waste.

Xu and his co-founders haven’t publicly addressed criticisms of Shein. Townsend, the senior adviser, said they think some of the allegations are unfair and that the company is misunderstood, but they do take the criticisms seriously.

Xu, who is not proficient in English, is in his late 30s. He was born in 1984, but a Shein representative declined to provide his birthday. He often wears pajama-like cotton shirts and pants at work, say people who have met him. He has intimate knowledge of the operations of small factories Shein contracts with, and can cite the average wage of garment workers.

Townsend, a former Activision Blizzard executive who also worked in former President George W. Bush’s White House, describes Xu as diligent, upfront and no-nonsense. “I’m convinced Sky never sleeps," Townsend said. In discussions, “he’ll cut right to the core of an issue."

Xu has traveled extensively over the past few years, hopping around the world to launch Shein in new markets. Xu has pushed Shein to adapt its designs and services to meet the particular needs of shoppers in each new country, a person close to Xu said.

At home, he opts for a top-down approach to management. After news broke about Shein’s IPO plans, the company didn’t announce it internally, and employees didn’t discuss the matter among themselves, a Shein worker said.

Xu isn’t the only Shein executive toiling in obscurity. Other e-commerce players in China say they know little about Shein because its executives and employees rarely interact with peers in the industry.

Townsend says she has told Xu’s co-founders they are also an important part of Shein’s story and that if they decided to go forward with an IPO, they would need to face the public: “I think in their minds, they’d like to avoid that—but if they have to do that, it should be Sky."

Write to Shen Lu at shen.lu@wsj.com

The World’s Most Anonymous CEO Is About to Take Center Stage
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The World’s Most Anonymous CEO Is About to Take Center Stage
The World’s Most Anonymous CEO Is About to Take Center Stage
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The World’s Most Anonymous CEO Is About to Take Center Stage
The World’s Most Anonymous CEO Is About to Take Center Stage
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The World’s Most Anonymous CEO Is About to Take Center Stage
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