The unlikely rise of a multimillion-dollar SF mall brand empire

In the early 1990s, a burgeoning San Francisco fashion label agreed to a novel advertising campaign that sparked a citywide crime wave. The ad agency’s pitch involved placing posters for the brand’s items — modern, form-fitting clothing for young women — on Muni bus shelters. These images wouldn’t be intended for bus riders, however.

They were geared toward drivers.

Leading up to the launch, the brand’s founder got in his car and crisscrossed the city’s hilly terrain, personally selecting each Muni stop location for the ads. To maximize impact and ensure eyeballs, the framing of the images was crucial: The shots of “come-hither” models were zoomed in, usually from the waist up, teasing only a part of a blouse and jacket. The coiffed hair, rouged cheeks and smoldering eyes left a lasting impression.

The campaign was not only a huge success but led to massive theft — not of the brand’s clothing but of the advertisements themselves. The phenomenon received media attention, and in early January 1991, the San Francisco Examiner ran a story with the headline “Sexy ad poster is a hit with thieves,” explaining how more than 30 were pilfered in less than a month. In the article, the ad agency’s vice president said its work had been vandalized before but noted that this was “the longest string of thefts of the posters.” 

That brand was Bebe, and according to its founder, Manny Mashouf, it was the first fashion company in the nation to use bus shelters as a marketing tool. 

Bebe doesn’t have the same kind of reverence that other San Francisco brands like Levi’s, Esprit or the Gap have. Its calling cards are tight shirts with bedazzled logos across the chest, sheer fabrics and brow-raising hemlines — things not to be taken seriously. Yet, the brand’s impact is undeniable. 

In its 50-plus years of existence, Bebe has appealed to masses of women, from actors who wore the fashions on (and off) some of TV’s most popular shows to teen girls longing for rhinestone tees that would serve as armor in a ruthless stage of life.

The company has been slapped with the derisive “mall brand” label, but its origins are far from atriums and Auntie Annes. Founded on San Francisco’s Polk Street by an immigrant who would eventually land on Forbes’ list of the 400 richest Americans, Bebe played a key role in starting trends and shaping cultural moments, and it remains part of the conversation today.

Manny Mashouf started what eventually became Bebe in 1971. An Iranian immigrant from Tehran, Mashouf opened a clothing store named Caspian Corner on the corner of Austin Alley and Polk Street. The shop had a large basement, and he hired a seamstress and pattern maker to create one-of-a-kind designs in the space. To fill up the rest of the shop, he also brought in designs from other brands. Initially, business was rough, and Mashouf used money from another venture he had, a steakhouse, to prop up the fledgling clothing shop. “The first year I remember I lost about $6,000 to $7,000, which was at the time a lot of money,” said Mashouf, now 86, on the phone from Southern California.

Mashouf came from a stylish family and always had an interest in fashion but took a different path and graduated from San Francisco State University with a degree in political science. The store’s future brightened after he flew to New York City and dove headfirst into the business of clothing, creating a crash course for himself. “I went up and down those buildings, 40-story buildings full of showrooms,” he said. “I learned, kind of, what’s going on in the fashion industry because I had absolutely zero education, zero expertise.”

Back at home in San Francisco from his exploration journey, Mashouf realized he needed to stand out to survive. He had already identified a gap in the market: “To address the young and attractive women who need to be more fashionable, a little bit more body-conscious, and enhance their looks — and consequently their lives,” he said. This helped distill the brand DNA to “unique, avant-garde and playful,” and success followed. By the second year, the store broke even, and in the third, it turned a small profit of a couple of thousand dollars.

That same year, an opportunity to expand to a store on Union Street arose, but it came with a challenge. The shop wasn’t on a corner, so calling it Caspian Corner wouldn’t work anymore. Mashouf wanted something meaningful, a name with history that evoked femininity and spirituality. Inspiration struck one evening during a conversation with friends. “[We were] talking about different things and music and philosophy, and all of a sudden I came to the realization that Shakespeare — ‘to be or not to be’ — it’s the one,” he said. 

Later, he realized the name also had other meanings. In Persian, it refers to the queen in a deck of cards. In French, it means baby. “But I did emphasize the Shakespearean connotation of it. And that’s how we came up with the name, B-E-B-E,” Mashouf explained. (This connection was later reinforced in 1996 with a perfume called 2be, which still sparks discussions on Reddit today.)

With no marketing money to spend, Mashouf capitalized on San Francisco’s abundance of underemployed models desperate for work to promote his store’s fashions. He built a little platform, set it up outside his shop on the sidewalk on Union Street, and hired a couple of models to pose on the makeshift stage and change every 15 to 20 minutes. 

Momentum grew, and Bebe stores sprouted up throughout San Francisco in the 1980s. Locations spanned Sutter Street and Fillmore Street, as well as a men’s store called M-Menswear across from the women’s shop on Union Street. In late 1989, Bebe opened in the state-of-the-art San Francisco Centre. Around this time, the Bebe suit was born.

“Fashion changed, and we started doing suits. There was a whole movement that embodied and embraced the idea of women in power,” Mashouf said. The jackets had 25 to 30 seams, significantly more than similarly priced contemporary brands, and they were distinctive. A Bebe suit could be spotted from a block away. The suits were made with various materials, such as French gabardine wool, viscose linen, and diacetate, “which is a unique fiber that a Japanese company developed for us exclusively,” said Mashouf. Strikingly different in their look and texture, the suits had one thing in common: impeccable tailoring, which could accentuate curves or elegantly drape.

Beyond the clothing, the aesthetic of Bebe stores added to the brand’s allure. The stores became known for their grand columns and faux-marbling treatments, a new technique at the time that Mashouf had a few of his employees learn and execute.

Malls were thriving, the stores were buzzing, and another opportunity emerged. According to Mashouf, the brand’s impressive revenue per square foot helped secure a unique arrangement. A lawyer negotiated deals with mall developers to cover the cost of building out Bebe stores, using their strong sales figures as leverage to attract other retailers. This strategy enabled Bebe to expand nationally, with major openings like a flagship store at the Beverly Center and a massive space at the recently opened Forum Shops at Caesars Palace in Las Vegas.

The year before her breakout role in 1997’s “The Devil’s Advocate,” Charlize Theron appeared in a series of ads. “She had done a movie, but [it] had not been released,” Mashouf said. “We paid her, it was the highest money we ever paid at that time, $2,500 for the whole day.”

By 1997, Bebe had a large corporate office in Brisbane and over 80 stores nationwide selling clothing, shoes and accessories, and its clothing could be seen weekly on prime-time shows like “Ally McBeal,” “Beverly Hills 90210” and “Melrose Place.” Heather Locklear was an especially big fan, solidifying Bebe’s standing as the go-to brand for it girls with a bad edge.

Around this time, Mashouf went on a trip to Paris and was walking through Galeries Lafayette, a high-end department store, when a sparkling item caught his eye. It was a black baseball cap with “Lafayette” written across it in cursive with crystals. Taken with the style, he purchased it, traced the origin of the rhinestones to a company in Geneva, and had 12 caps made with the Bebe logo. “Nobody wanted it,” said Mashouf, recounting his colleagues’ distaste for the cap. “They were saying, ‘Manny, how can you do this? This is not appropriate for Bebe.’”

Captivated by the look nonetheless, he dismissed the skeptics and fully embraced the style. Bebe began adding clear rhinestones and gems in six different colors to shirts and caps, launching a Y2K emblem and what would grow into an $89 million logo business, according to Mashouf.

The logos also opened up the brand to younger consumers. While Bebe cocktail dresses clung to a $150 price point, in the late 1990s, a plain logo shirt cost around $30. Though still out of reach for many, given today’s criminally priced status symbols, the sum was not entirely unattainable to get in on the trend.

Eyeing an initial public offering, the company shifted gears again, de-emphasizing its disruptive suits and choosing to focus on “head-to-toe lifestyle dressing” and the elusive promise of “day into evening” fashions that were perpetuated by every women’s magazine of the era. 

The hits kept coming. Bebe began working with Lambesis, the creative agency behind Skyy Vodka and Campari, and a wave of new, glossy ads began to circulate. Echoing the platform stage days on Union Street, they featured models in the early stages of their careers looking to build their portfolios. Among the rookies who vamped for Bebe in shaggy, faux-fur coats and skin-tight skirts were Adriana Lima and Jaime King — Rose McGowan also made an appearance. The highly saturated images, captured by top photographers like Ellen Von Unwerth, were instant flip-stoppers, even in magazines like Vogue that were over 500 pages long at the time and half-filled with ads. 

Bebe filed for an IPO in 1998 and continued its expansion, rapidly opening up stores and kicking off various offshoots. In a complete departure from Bebe’s suit business, Bebe Sport entered the scene in 2003. Offering a line of tracksuits, leggings and some other decidedly unsporty items — like two-toned bustiers — it put athleisure on the map before the word existed. 

In 2005, Bebe announced Neda by Bebe, a line of accessory stores named after Neda Nobari, the company’s vice president of design and then-wife of Mashouf. That same year, the couple, both graduates of San Francisco State University, donated $10 million to their alma mater. It was the largest private donation in the school’s history at the time.

A new batch of actors began promoting the brand, this time not on TV but in the ads themselves. After her character — everyone’s favorite poor little rich girl, Marissa Cooper — was unceremoniously killed off in “The O.C,” Mischa Barton’s shadow-catching cheeks began gracing Bebe billboards in 2006. The following year, Bebe Sport tapped 32-year-old Eva Longoria in the midst of her career-making “Desperate Housewives” run to serve as the face of the brand. Gorgeous, gleamy-clavicled, with a suggestive twinkle in her eye, she fit the bill to a tiny tee.

At the start of 2007, Bebe was operating over 250 of its various stores across North America, with plans to add 50 more. In 2009, the company’s yearly revenue reached a peak of $603 million.

The toll of the recession was brutal for many traditional retailers, and Bebe was not spared. The rise of online shopping and the growing dominance of fast-fashion giants like Zara and H&M put pressure on the brand, and the turmoil was reflected in frequent leadership changes. Mashouf, who had led Bebe since its inception, stepped down as CEO in 2004 to become non-executive chairman. He returned in 2009 to navigate the company after the former CEO left abruptly, stepped down again in 2013, and then reclaimed the CEO role in 2016.

Bebe also struggled to keep pace with shifting fashion trends, a challenge that impacted dozens of brands, including American Apparel, Wet Seal and BCBG Max Azria. By March 2017, Bebe announced it would close all its physical stores, laying off 700 employees.

Today, Mashouf remains CEO in title only and says he hasn’t been involved in decision-making since around 2019. “The company owns majority shares and bought most of my shares,” he said. “So I’m just, you know, on the board now.”

To avoid bankruptcy, the company sold its distribution center in Benicia for $21.8 million in mid-2017. It also entered several licensing agreements around this time, which focused on building out e-commerce and wholesale deals, further diluting the brand. 

As of late 2023, after buying 3.7 million shares, B. Riley Financial owned approximately 76% of Bebe; Mashouf retained around 4%. Today, Bebe’s licensed products are sold online, in more than 100 international stores and at struggling retailers like Macy’s.

When people think of fashionable cities, San Francisco isn’t top of mind. Nevertheless, we have a number of clothing brands that have cemented their legacy here — their names are etched into museum walls and stadiums across the Bay Area. Bebe is one of them. Years after the Mashoufs made their donation to San Francisco State University, the money was used to build a sleek, LEED Platinum-certified fitness building on campus that’s visible from Lake Merced Boulevard. It’s named the Mashouf Wellness Center.

Bebe is described the same way in countless articles: sexy, skimpy, provocative, racy. This language remained consistent whether the company was booming or beginning to dissolve, making successes seem like strokes of luck and failures appear inevitable. It wasn’t described as savvy or groundbreaking, but it was.

While Bebe clothes were more affordable than designer fashions, they weren’t cheap — in their price or their manufacturing. When Eva Longoria signed on to be the face of Bebe Sport, she talked about her love of the brand and inability to afford it. “When I was poor, my dream was to walk into Bebe and buy everything,” she told Women’s Wear Daily in 2007. But unlike the countless competitors that led to its demise, during its heyday, most Bebe clothes were made in California factories, many using Japanese and Italian fabrics. They were a good value.

At the same time, Bebe was accused of ripping off other designers. One undeniable example was Hervé Léger’s bandage dress, but the brand was ripped off, too. Bebe’s rhinestone logos inspired an army of imitators, from Juicy Couture to Baby Phat, and more recently, Balenciaga. Now, these sparkly tees are a huge hit at Y2K “vintage stores” that have cropped up along Haight Street and can be found all over Depop. 

The mimicry also got more serious than that. In 2002, May Department Stores was forced to drop its “Be” clothing line after federal courts ruled in favor of Bebe, agreeing that “the name, the lowercased logo and even the advertising behind Be are confusingly similar to those of Bebe,” the Washington Post wrote at the time. May executives argued that customers wouldn’t confuse their line with Bebe’s “slutty” clothes.

Still, the company remains a cultural touchstone and has held our attention for over half a century. A 2010 Vanity Fair article titled “The Suspects Wore Louboutins” — which prompted Sofia Coppola to make “The Bling Ring” — sparked a viral moment when one of the teen robbers insisted through tears and screams that she wore “little brown Bebe shoes” to court, not Louboutins as reported. 

The writer revisited the article in 2020, called it an “affliction” and offered a concession. “I did mistakenly say that Neiers was wearing a pair of Louboutins to court — instead of her ‘little brown Bebe shoes’ — ‘twenty-nine dollars!’” 

She didn’t mention changing the title.