Victoria’s Secret was founded by Tufts University and Stanford Graduate School of Business alumnus Roy Raymond and his wife Gaye in San Francisco Ca in 1977.Eight years prior to founding Victoria’s Secret, Raymond had been embarrassed when purchasing lingerie for his wife at a department store.

Newsweek in 1982 quoted Raymond in 1981 explaining: “When I tried to buy lingerie for my wife,” he recalls, “I was faced with racks of terry-cloth robes and ugly floral-print nylon nightgowns, and I always had the feeling the department-store saleswomen thought I was an unwelcome intruder.”
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During the 1970s and 1980s most women in America purchased “dowdy”, “pragmatic” “foundation garments” by Fruit of the Loom, Hanes, and Jockey in packs of three from department stores and saved “fancier items” for “special occasions” like honeymoons.

“Lacy thongs and padded push-up bras” were niche products during this period found “alongside feathered boas and provocative pirate costumes at Frederick’s of Hollywood” outside of the main stream product offerings available at department stores.Raymond studied the lingerie market for eight years before borrowing $40,000 from his parents and $40,000 from a bank to establish Victoria’s Secret: a store men could feel comfortable buying lingerie.

The company’s first store was located in Stanford Shopping Center in Palo Alto, California.Victoria’s Secret grossed $500,000 its first year of business at the Stanford Shopping Center. It was financing to expand the company from a headquarters and warehouse with four new store locations.The company expanded its sales channels via establishing a mail-order catalog operation.

By 1980 Raymond had added two stores at 2246 Union Street and 115 Wisconsin Street.By 1982 the fourth store (still in the San Francisco area) was added at 395 Sutter Street.

Victoria’s Secret stayed at the 395 Sutter Street location until 1991 when the store in need for more space relocated to Powell Street frontage of the Westin St. Francis.  In April 1982, Raymond sent out his 12th catalogue. Catalogue sales now accounted for 55 percent of the $7 million of the company’s annual sales. At this time, each catalogue cost $3.

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The Victoria’s Secret stores at this time were “a niche player” in the underwear market. The business was described as “more burlesque than Main Street.”Raymond’s philosophy of focusing on selling lingerie to male customers was becoming increasingly unprofitable; Victoria’s Secret was heading for bankruptcy.

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1982: Sale to The LimitedRaymond sold Victoria’s Secret Inc., which was grossing $6 million annually with its six stores and 42-page catalogue, to Leslie Wexner, creator of Limited Stores Inc of Columbus, Ohio, for $4 million, a figure later disclosed; at the time the deal was made, the New York Times reported that the sale price was not disclosed.

In 1983 Leslie Wexner revamped Victoria’s Secret. He discarded the money-losing model of selling lingerie to male customers and replaced it with one that focused on a female clientele. Victoria’s Secret transformed from “more burlesque than Main Street” to a mainstay that sold broadly accepted underwear.

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The “new colors, patterns and styles that promised sexiness packaged in a tasteful, glamorous way and with the snob appeal of European luxury” were supposed to appeal to and appease female buyers.

To further this image, the Victoria’s Secret catalog continued the practice that Raymond began:listing the company’s headquarters on catalogs at a fake London address. (The headquarters were really in Columbus, Ohio. Also, Victoria’s Secret stores were redesigned to simulate the feel of 19th-century England.In 1986, four years after the sale, the New York Times commented, “in an industry where mark-downs have been the norm, the new emphasis is on style and service. The lingerie business was changing fast.”