douchebag capitalism

Yesterday’s WSJ has a good profile of Dov Charney, the Montrealer who founded American Apparel. Charney has become more or less infamous but this piece is useful because it helps illustrate two of the tensions implicit in contemporary capitalism.

The first is the way the notion  of “authenticity” has replaced “rebellion” as the litmus test of cool in conteporary capitalism:

Mr. Charney insists his leadership style provides a model of authenticity for young people looking for alternatives to a “Baby Boomer economy which is collapsing.”

He is also adamant that his behavior is appropriate for a trendsetting fashion company. Sporting vintage glasses and tight shirts, the 39-year-old Mr. Charney seems almost a living resurrection of the free-spirited 1970s. He sees himself as crusading against today’s puritanical conventionality and likens himself to Larry Flynt, the Hustler magazine publisher who fought many First Amendment battles.

The second point is the way Charney’s successes and failures illustrate the difference between entrepreneurialism and business. Charney may be a brilliant entrepreneur, but he’s a lousy businessman. The company’s books are a mess, repeated attempts at bringing in outside financing have fallen through, and the company went without a CFO for years. When he finally decided to get one, he took out a classified as in the Montreal Gazette and got his father to vet the applicants. In a recent interview, he called his current CFO a “loser” who had “no credibility” in the industry.

Fascinating stuff.

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