50 states project | Feb 5, 2022 |
Why this California designer got rid of her markup

The 50 States Project is a series of candid conversations with interior designers across the country about how they’ve built their businesses. This week, Los Angeles–based designer Kishani Perera tells us about the chance encounter in Whole Foods that led to her first big client, how she navigates a celebrity clientele with an ever-growing contract, and why she wants to rethink the way we build houses from the studs up.

Did you always want to be a designer?
I always did it, I just never knew that what I was doing was “interior design.” I was a creative, artsy kid who loved redoing my bedroom at home over and over again. I would go thrifting and find things, or pull things out of the garbage and refinish them. But as a career, I fought it tooth and nail, to be honest. Interior designers weren’t a very eclectic group of people at that time, and in my mind, I didn’t fit into that group at all. It seemed much stuffier—very formal, and everything was gold and gilt and silk. It wasn’t my vibe at all.

I always had friends telling me I’d be a great interior designer—in high school, and in college as I’d be redoing their dorm rooms. But I went to UCLA as an English major, and I thought maybe I’d go into broadcast journalism. I worked in the newsroom at NBC and tried a bunch of other creative things like photography and metalworking—but none of them felt right. Finally, I was dealing with a bunch of health problems and I couldn’t really continue working in restaurants at night to support my day job of trying creative jobs. I needed to figure out what to do. Everyone kept saying, “Try design!” So I finally gave in and I started at UCLA’s extension program in the design program. Within 10 minutes of my first day in class, I was like, “Oh, my god, I’m a designer! This is everything I love!” By that point, I was 26. If I had listened to everybody, it would have saved me a lot of time.

But once you were in, you were all in?
Yes. Within a year, I was like, “I want to start working with other designers.” I felt the classes were good, but very theoretical, and I really wanted to get out in the field and do things. So I started interning for Joan Behnke, and I quickly realized I was not learning anything about the day-to-day realities of the design business in class. I only took a few more classes after that, but I worked with Joan for about a year, and then I worked for Kim Alexandriuk for about two years. Then I had an amazing opportunity to go out on my own and I took the leap.

What was that opportunity?
I met this guy who was doing design for a lot of celebrities. And I have to tell you, I truly manifested this, because I kept saying, “I really wish I could meet somebody to partner with who has connections to people with money.” Because nobody I knew had any money—nobody I knew would ever hire a designer. I wanted to find someone who was well-connected and could be on the business side of it, and I could do the creative side. But this story is insane—are you sure you want to know about this?

Now I want to know everything!
So I was always talking about this with a friend of mine who is very woo-woo, and she would say, “You just have to think about it, and it’s going to happen.” But I was always like, “Yeah, whatever.” So then I was at Whole Foods one day and I saw this guy. I literally stopped dead in my tracks. I was following him through the aisles, and I kept thinking, “I don’t think I know that man, but I feel like I should know him.” Then he walked out of the store, and I was like, “Oh well, I didn’t talk to him.”

When I told my friend about it, she said, “Maybe he’s your future husband.” I didn’t think so—I didn’t get that vibe—but for some reason, I felt like I should know him. She was like, “Well, we’ll see. Maybe he’ll come back around in your life.”

This friend used to work at a furniture shop called Orange on Beverly. One day, I was there shopping for my boss. I had my back to the door when she said, “Don’t look now, but Ellen DeGeneres just walked in with her interior designer.” I turned around, and I was like, “That’s the guy! That’s the Whole Foods guy!”

No way.
Yes! My friend told me that he was a designer, but he didn’t know what he was doing—she was like, “It’s not his trade, he was in the music industry and fell into it because he started meeting a lot of famous people and he has really good taste. He is a good shopper, and now he’s working with all these huge people.” She introduced me to him quickly—obviously it was not the time to have a whole conversation, because he was shopping with Ellen—and then she called him for me a couple days later. Then he called me and was like, “I hear you’re into design, and that you can maybe help me out.” So we went to dinner, and he’s like, “Would you consider partnering with me? I’m working on this house for Molly Sims, the contractors are asking me for drawings, and I have no idea what to do. I’m a good shopper, but I don’t know construction.” I was like, “I totally know construction. I can help you. Let’s partner.” So that was that—I quit my job, and took the leap.

I started working with Molly, and once the guy saw I knew what I was doing, we didn’t see him too much anymore. He’s like, “Oh good, you got it.” Molly and I developed a great relationship, and then I worked with her for 10 years after that.

Why this California designer got rid of her markup
A cozy remodel in the Beverly Grove neighborhood.Anthony Barcelo

How did that partnership evolve?
He turned out not to be a great partner, so we parted ways shortly after that first job. But that was his function in my life: to introduce me to Molly and get me to quit my job. Molly was a great supporter, and she referred me to a bunch of people. That was in 2003—almost 20 years ago now. Honestly, it doesn’t even seem real.

It sounds like it happened really quickly.
It did. I had only been working for other designers for three or four years. In hindsight, I probably should have waited to start my own business, but it was such a great opportunity. There was a lot I didn’t know, but if you wait until you know everything, it’s too late. You have to jump into it—or at least, I’ve always been that way, and I’ve learned from every mistake I made so I can do better the next time.

What were some of the early surprises about running your own business that you hadn’t seen in the places you were working before?
The liability was probably the biggest and scariest thing. When you’re young and starting out and basically doing jobs for free just to build your portfolio, you make one mistake and you’re paying for it. If you make a big mistake, you’re paying for it. In the beginning, I didn’t have a lot of money to hire people, so I was doing everything myself. I was up until 3 o’clock in the morning writing purchase orders—those are the mistakes I’ve made, where I’m like, “Oh, it’s one number off and I ordered the wrong fabric. Now I’ve got to pay for it.”

There were also definitely some situations where it wasn’t my fault, but I was like, “I’ll pay for it,” just to avoid conflict, but those situations have helped me develop an amazing contract. I’m the type of person who believes the best in people. I didn’t anticipate some of the crazy things people would try and pull to get away with saving money. Sometimes it’s like, “You’re blatantly lying right now. How could you do that to somebody who has been good to you and worked so hard for you?” That side of humanity is something that I didn’t expect, and it was shocking.

Is that a “one bad apple” kind of thing, or a bigger realization that humans are flawed?
I’ve had a few of them—probably a good half a dozen—with a [certain] sense of entitlement. That was definitely the case with one client I had who was too used to getting his way. He was like, “I’m just not going to pay you any more.” I was like, “But I just bought $60,000 worth of stuff for you that you called me to tell me you love.” He’s like, “Yeah, I love it, but I just don’t want to pay any more.” It just defies logic to me, especially as somebody who grew up a goody two shoes, who always did the right thing and believes in karma. I just didn’t understand.

Have you been able to protect yourself?
You just get better at reading people and seeing red flags. A couple people still slipped through my defenses, but I’m better prepared. I was like, “This could be a nightmare. I’m going to keep my guard up and be very careful about keeping records of everything.” In the end, I was right and doing all those things did protect me, so I was able to move on from it unscathed. And as I get older, my contract gets longer and longer and longer.

A record of past wrongs?
Yes! It’s funny, because when really nice people read my contract—people who would never dream of doing those things—they’re like, “Wow, people have done some crazy things to you.” I have lovely, lovely clients now who are super appreciative and kind. But those are the growing pains of being super naive, nice and hoping for the best instead of going into it with a business mindset.

What does that vetting process for prospective clients look like for you now?
We’ll do a couple of Zoom calls. I try to make it really long and have a conversation with them versus talking so much about the project. It’s kind of like dating. When I know there’s going to be trouble ahead, I’ll say, “I’m not sure this is the right fit,” and then see how they respond. I’m just more honest and open now where before I was shy. Part of how I was raised was that no matter how hard it is, you deal with it. Now my attitude is a bit more like, “There’s no reason to force it. If it doesn’t sound like a good thing, then move on.”

Does saying that to people shock them into better behavior, or is that usually the precursor to the end?
It’s often gotten them to behave, so it’s good. Maybe they’re used to treating people a certain way, and saying, “I’m not OK with this” can make a difference. Sometimes it does lead to the end, too. I worked with this woman who was always very polite to me, but she would constantly call and scream obscenities for no reason at my team. I told her, “This is not OK. You need to speak to them the way you speak to me, and be respectful to all of us.” She was like, “How dare you speak to me that way?” It got really ugly from there, and I was like, “This isn’t going to work for me, so take care.” But more often than not, if you say to people, “Here are my boundaries,” people are respectful.

Left: For an extensive remodel of a Tudor-style home, Perera updated the interiors while preserving the property’s original aesthetic. Noah Webb | Right: Custom paneling and vanities throughout the home feature vintage-inspired details. Noah Webb

How has your business grown? Was there a specific moment of growth, or has it been a slow and steady progression?
It’s been slow and steady for sure, but there was a turning point 10 to 12 years in where I was able to stop looking for leads and clients were coming to me. I always got good referrals, but that’s not a constant flow at the start.

I’ve also diversified a bit too. I was just doing residential work for a long time, but at a certain point, I was introduced to a developer who asked if I’d do some design work for them. At the time, I was like, “I don’t want to do these white, modern boxes.” He asked me what I would want to do, and I was like, “If I can do what I do in a spec house, then I’ll do it.” They were open to it, but said, “You just can’t make it so specific, because we’re trying to appeal to a lot of people.” I told them, “That’s actually the wrong tactic. I think we should make it specific so it looks like somebody’s home and it looks like they loved and cared about it.” They grew to understand that, and I worked with them for a long time.

Was that valuable as steady work in addition to your clients, or did it help you find new residential clients, as well?
It expanded my client base into a lot of relationships with different realtors. They would refer me to their clients—and the same with other developers and prospective homebuyers. We had a client who called the office a couple of years ago and said, “I saw four houses on the market, three of them were yours, and I was in love with all of them. You design all of them for these developers, so I just figured I would call and hire you.” She wanted me to buy a house, do a huge remodel and furnish it. So it’s a good calling card to have out there.

The development projects that I have been doing lately are at crazy price points—they’re all well over $10 million, and the one that’s about to go on the market right now is $25 million. It’s fun to be able to work on a project of that scale and have people who are buying $25 million houses see your work and appreciate it.

What is a $25 million house, exactly?
It’s almost half an acre in Brentwood, which is a lot of space for that neighborhood. It’s a beautiful flat lot, so it’s really livable—sometimes when you’re in the hills, a lot of the land is a hillside and you can’t use it. It’s a three-story house with a basement, and it’s 15,000 square feet with a guest house. It’s very European farmhouse and Napa-inspired. I even convinced the developer to do this reclaimed wood on the siding instead of just regular siding, and the patina on the wood is really amazing.

What is the timeline like on that kind of job versus a client project?
You would think it goes faster because a developer’s goal is to build and sell it quickly, but they want to make sure it’s luxury down to the studs. This house took about two years—I’m sure the pandemic didn’t help—but it was a ground up construction and a really big property. If there’s a client involved, it probably would have been double, just because there are so many decisions to be made on a house of that size. So I guess two years is actually pretty quick.

Why this California designer got rid of her markup
Custom cabinetry trimmed in brass adds a luxurious touch to another Hancock Park home. Perera used vintage hardware that was original to the house for a more authentic feel.Anthony Barcelo

How has your team grown over the years?
I was on my own for about two years, and then I hired a friend to help because I couldn’t handle any more purchase orders at 3 o’clock in the morning. She was my part-time admin person for 13 years—she learned the business side from all the bookkeepers and accountants we hired, and she ran the office. It truly was me on my own doing all the design for the first eight years. I had a couple of interns here and there, but I just didn’t have the resources to hire people. Then I opened a shop.

And then you really needed somebody?
Exactly. I hired somebody full-time for the shop, and they helped with the design purchases. And nine years into my firm, I hired an amazing full-time design associate who stayed with me for six years. Now, I’m a team of five, with a sixth on maternity leave, and I don’t think I want to get too much bigger. I find a lot of my day now is managing the employees, and I don’t get to do what I really love, which is design.

How did you decide what roles you needed to fill, or what kind of support you needed?
I just hired as the need arose. I hired a couple of project managers a few years back because I realized I needed somebody else thinking about the details besides me—I felt like my head was going to explode.

It’s really hard to find the right combination of people, and I have a really good team right now, so I’m praying nothing changes. But toward the end of last year, I was starting to feel a little bit burnt out. I was managing the team and our projects, overseeing the finances, dealing with contracts, and having conversations with potential new clients. I have bookkeepers and business managers, but I’m on the phone with them all the time because they need my input. I’m sure the pandemic didn’t help, because you’re trapped at home, but I felt like all I was doing was management. I realized I was not loving my job. What I want to do—my favorite thing—is sit at home in my pajamas working on design boards until the wee hours of the night. I took on some smaller decorating projects for former clients so I had something fun and design-y to do.

Why this California designer got rid of her markup
Bookmatched slabs in a statement shower are the focal point of a Bel Air primary bath.Roger Davies

How many new projects are you typically working on at a given moment?
Usually 10 projects. We’re doing 14 now—they’re all in different phases, but it’s a lot for six people.

Where do the clients see you on each of those jobs? Where are you hands on and more active in the project?
I’ve realized that what I like to do is set the tone for the project at the very beginning. We always start with the inspiration board and ask, “Is this the right vibe? Here are six different directions we can go with your house.” I like to do those. Once the clients pick the vibe, I like to get them started to set the tone, so my client and team knows what I’m thinking and where we’re going. That being said, it’s very collaborative—it’s not only my vision. On most projects, there’s at least myself and two people involved: one point-person and somebody else helping. The more people thinking about something, the better it is, and the more collaborative and creative it becomes.

Obviously, I’m still involved after setting the direction, but my team is more boots on the ground for many reasons—one of which is I’ve been dealing with a lot of crazy health things and can’t actually be in many of our clients’ homes. For a lot of our projects, my team has the day-to-day relationship with the clients that I wish I had.

Do you mean you aren’t actually seeing the projects come to life?
Yes. I’ve been dealing with some insane autoimmune issues—apparently for the past 20 years, but I didn’t know about it until a few years ago. It has to do with black mold, which I’ve been exposed to a lot by working with developers who were buying and renovating condemned houses. To the average person with the average immune system, it probably would have been no big deal. But I now know I do not have a normal immune system. I was getting progressively sicker, especially over the past decade. Now, I literally can’t step foot in an older house—not even for a minute, not even with a hazmat suit. Clients will call and they’re like, “I have the most amazing home from the 1920s,” and I’m like, “Here’s the thing: I can design it, but I will never be able to go in your house.” They obviously think I’m joking—as would I, if I were in their position. When I got this diagnosis a few years ago, my doctor told me, “You can’t do it, or it’s going to kill you. You have to get rid of your shop; you can’t be around antiques or vintage, because they’re full of mold; and you have to get rid of your house if you want any chance of being remotely healthy one day.”

Wow. That had to be terrifying on so many levels.
I thought I was going to lose my career. Thank God I built up a great reputation and had very trusting people coming to me. Now, it’s actually a fun design challenge, and luckily the projects have gone off really well. I’ve had a few clients who said, “I thought there was no way this was going to turn out well when you’re standing at the window peeking in on FaceTime with your project managers, but we are really happy.” Anyway, that has been a huge factor in how the day-to-day of my business works right now, which is why it’s super important to have a great team to support me.

That also explains why you closed your shop a few years ago.
I didn’t really want to, but it was making me very sick. I had to sell my house, and I bought another one—after years of trying to remediate it, it’s only in the past few months that I finally bought a house I can actually live in.

How has that shaped the work you do?
When all my health issues began, I started researching, and I learned that the way homes are built is literally killing people. Indoor air quality is often worse than outdoor air quality, and doing things like using nontoxic paints or buying organic fabrics doesn’t make much of a difference if the structure itself is emitting toxins all day long.

It started me on this journey, working with my doctors and talking to all sorts of people to try developing a new system of building I’m calling “Healthy Homes.” I’ve been implementing it in many ways for the past few years, and my goal for this year is to build a 100-percent healthy home, top to bottom. I feel like this could be something that would be beneficial to a lot of people—some of my doctors are crazy global experts, and it’s something they say is affecting more people than you’d think.

Why this California designer got rid of her markup
A Brentwood home for a pair of globetrotting clients layers textures—from custom paneling to vintage rugs—in a soft sepia hues for a serene primary bedroom.Dominique Vorillon

The idea of that healthy home, what does it take to get there?
Wood framing is the worst, because mold loves wood. In an ideal situation where you didn’t have to worry about the budget, that’s what you’d replace first. Depending on what your concern is, there are different ways to go about it—I work with each client around their concerns and particular health issues, like asthma or mold. A steel frame is more expensive, so not everybody can do that. Maybe in that case, you go, “OK, fine, let’s build with wood. But instead of doing toxic insulation, let’s do wool insulation, which is all-natural and mold-free.” There’s also different types of hemp insulation, and hempcrete instead of concrete. All of these materials are not just great for the environment, they’re also fireproof. There are so many benefits, it’s just about shifting the way of thinking. I mean, this is how houses used to be built! When I go to Europe, I can go into a building from the 1700s because it’s built with stones and cement. Here, if I go into a house from the 1930s, I’m sick for months because it’s all wood and drywall.

Modern materials also deteriorate over time. I’ve seen this happen on mega-mansion houses that the developers build. After one rainy day, the black mold is crawling up the studs and the framing. I’m like, “What are you guys gonna do?” They’re like, “It’s fine.” But no, it’s not fine! Now you’re going to sandwich it with insulation and drywall and stucco, and it’s going to sit there in the dark with the moisture, and it’s going to get exponentially worse. In 10 years, it’s going to be a huge problem, but nobody thinks about it because they can’t see it. I want to get down to the foundation of a building and rethink the materials that we choose.

Are substitutes like wool or hemp insulation wildly more expensive? What do you think is keeping the industry at large from moving in that direction?
Contractors are used to doing things a certain way. When there’s a learning curve, they often don’t want to figure it out. I’ve been told, “I’m going to charge you double for that.” It’s really not that different—you install it the same as you would regular insulation—but there’s a resistance to what is unfamiliar.

Some of the materials are definitely more pricey, but it’s mainly because they’re not as widely available. It’s smaller manufacturers making these things, but they’re out there. They’re just not available at Home Depot, so the prices can’t be matched. I think in the future, it will become much more readily available to the average person. These are things that are great for the environment and people; why wouldn’t you use them?

Remote work in general has become much more widely adopted in the past two years. But how have you adapted to being more removed physically from some of your projects?
My health struggles brought me down this road, and it definitely affects my day-to-day in terms of the projects we have, but technology has made things so easy. I’m now doing Matterports of the houses that I can’t go into. I can at least stand there and Matterport my way around the house and look up at the ceiling and floors—it’s like I’m in the space. I’ve gotten very good at it—maybe it’s like when somebody goes blind and then their other senses get heightened.

And does that same healthy approach to building the home also trickle into the interiors and the way you’re thinking about furnishing these spaces? How do you talk about that with clients?
I guess I’ve been really lucky living in L.A., because everybody here is drinking organic smoothies. It just wouldn’t occur to me that somebody wouldn’t care about that. I mean, if you have a choice, why would you pick the super toxic thing over the non toxic thing? What I’ve found is when you talk about the environment, people don’t care. But when you talk about health, they listen.

A lot of my clients actually came to me because I think that way. I started working with Kaitlin Olson from It’s Always Sunny in Philadelphia because she loved everything organic—and this is at least 15 years ago, when it wasn’t so trendy. She referred me to her friend Emily Deschanel, the actor on Bones, because we are both vegan and love nontoxic things. She was like, “You should be friends and work together.” And we did. That group of friends referred me to other friends who felt the same as they did—so maybe I’m in a bubble where I think people care, but everyone that I’ve worked with so far has—or if they didn’t initially, they did in the end.

Why this California designer got rid of her markup
Perera transformed an all-white Brentwood spec house into a family home that feels well-traveled and collected.Dominique Vorillon

How have you approached billing for your work?
I changed my pricing structure a few years ago. Everyone does markups and a fee or an hourly rate, but I always felt like markups created a bit of conflict of interest. I worked with a designer who was always trying to buy the most expensive things for her clients, so she could make more on markups, but that seems wrong to me. There’s no transparency, and I don’t like giving people that feeling of distrust. I did it, but I didn’t like it—and clients never liked it, either.

To be honest, my model of design has always been a high-low mix of finding something on Etsy, mixing it with something from Thomas Lavin in the Pacific Design Center. Markup just didn’t work for me, because I was like, “Here’s my 30 percent markup on this $10 item.” Honestly, that’s probably why I couldn’t afford any help.

A few years ago, I decided I wanted to streamline and simplify things. It was when my friend who did admin for me for 13 years left the firm. I decided to get rid of my markup because I thought it would eliminate a lot of paperwork. Instead, I was going to conduct an experiment where I let clients pay for everything directly, passed along all of our discounts, and just charged hourly for our time, and see if I lost money or made more money. I found that I make more money this way, and the clients are so much happier, too—they see all the paperwork, they see all the discounts, and they’re paying for it so they get the credit card points. They feel like our interests are aligned because they know I’m looking out for them and trying to get them the best deals. It just seems more synergetic. They might sometimes have sticker shock from some of our early bills, but I’m like, “Just wait for it. In the end, I promise you will be saving a lot of money.”

I did a really big project with this huge celebrity and their business manager was like, “I will refer you to all of our clients, because to be honest, I budgeted $3 million in furnishings and fees for this project, but you came in at $1.5 million and the client is going to be happier.” It’s a win-win for everybody.

Before that switch, were you only making money on your markup, or were you also charging a design fee?
I was charging a design fee, too, but it got hard—you’re losing money every time a client changes their mind and wants to do something different. I didn’t want to resent the client, I want them to be happy. With the hourly charge, I don’t have a minimum per se, but I can give you an idea of what I think it would cost. I can say, “Here’s what you can expect to spend on design fees—it’s probably going to be a couple hundred thousand dollars, depending on what we’re doing, so don’t be shocked when you get those bills. But in the end, you’re going to save hundreds of thousands of dollars, too.”

It’s way less stressful for paperwork, accounting, bookkeeping, and sales tax. It’s just cleaner, and if a client wants something, we’re like, “Great. Here’s the paperwork we got from our vendor. Do you want to put it on your credit card?” They approve the cost, we put it on the card and we’re done. Obviously, there are a few wholesale showrooms that are like, “No, you have to pay for it,” and then the client just reimburses me.

I love that you mentioned the credit card points as a real motivator.
It really is! And I think people are willing to spend more if they don’t have to worry about reimbursing their designers in cash. If it’s all on their card, they’re good to go.

Can you tell me more about the housing market and the design sensibility in L.A. in general?
Prices are outrageous. I was just on the phone with my best friend, who is thinking about buying an 800-square-foot house for $1.3 million. I was like, “Are you insane?”

One thing I am seeing is even the clients with infinite budgets are being more conservative. Even billionaires! They’re not being extravagant just to be showy. I think that used to be a sign of prestige—to be able to say, “We spent $200,000 on this sofa.” There’s still a little bit of that, but I think more and more, people think it’s cooler to be smart with your money. Some of my biggest clients have more money than God, but I’ll bring them something I found on eBay and they’re [into it]. It’s just more about being comfortable and happy.

My projects 20 years ago were very formal and fancy, even if they were funky. I think everybody, even if they’re in a $25 million house, is gravitating towards what’s comfortable for the family, what they’re cozy in, and what they don’t have to be precious with. I think that’s just part of the California culture in general, but now it’s a huge thing in what I’m seeing with clients.

Designers tell me all the time, “All I want to do is have famous clients.” Do you recommend it?
I would say generally, as appealing as it may seem, there there can definitely be a whole lot of extra dynamics that go along with working with famous people, like finding time to meet [amid] their hectic work schedules, sometimes while touring or filming in other countries or time zones. That being said, some of the celebrities I’m working with right now—and so many in the past—are some of the kindest, most wonderful people in the world. And I will tell you what I do love about working with actors and musicians: they are creative, so you always have creative input and they’re open to doing crazy things.

What is the one thing you know now that you wish you had known when you launched your business?
I’m actually glad I didn’t know anything, because if I knew half of what I know now, I probably wouldn’t have done it. I went into it blind faith and optimism. Knowing that you don’t know everything and being open to learning is the biggest and most important thing.

To learn more about Kishani Perera, visit her website or find her on Instagram.

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