Mr. Galloway was raised in Los Angeles by immigrant parents. His father, a charming sales executive raised in Depression-era Scotland, had a “terrible relationship with money,” he said. His parents divorced when he was 9 and he lived with his mother, who worked as a secretary.
“It was a huge source of stress that we had no money,” he said. “It was also very embarrassing.” Mr. Galloway became obsessed with money and bought his first stock (Columbia Pictures) as an eighth grader. He was not popular. “I looked like Ichabod Crane with bad skin,” he said. In high school, he ran for class president three years in a row and lost each time. He also developed body dysmorphia, he said.
He went to college at UCLA and describes his time there, with a tone of not entirely convincing regret, as a “missed opportunity to be responsible.” He joined a fraternity, the rowing crew, and gained 20 pounds of muscle. “Honestly, my life changed,” he said. “Suddenly women were very interested in me.”
During business school at the University of California, Berkeley, he and a classmate started a firm called Prophet Brand Strategy, advising companies on how to build their brands. In the early 1990s, their advice often amounted to: Use the Internet. They attracted major clients, including Williams-Sonoma, Levi Strauss and Apple. In the dot-com boom, they created a number of companies, including an e-commerce site called RedEnvelope, where people could buy and send last-minute gifts.
RedEnvelope received an influx of money from venture capital firms, including Sequoia Capital, but Mr. Galloway thought the new funders were taking the company in a terrible direction. His battle to replace the board failed, but attracted the attention of hedge funds. “They said, ‘We love your crazy needlepoint,'” he said.
