Diane von Furstenberg: godmother of American fashion

Last year, Diane von Furstenberg went on tour to mark the 40th anniversary of a dress. It wasn't just any dress, says Interview Magazine, but a "20th-century icon of design and desire on a par with the Eames chair, the BMW 2002 and Chanel No. 5". Von Furstenberg's body-hugging jersey wrap dress, conceived in New York in the early 1970s (when she wasn't out partying at Studio 54), became the totem for a generation of a women celebrating the more glamorous side of Women's Lib. It has since enjoyed several revivals as indeed has the DVF business, which, despite several brushes with bankruptcy (see below), Forbes reports is "thriving today with revenues estimated at $500m".

Von Furstenberg, 68, is "fashion's ultimate seductress", confiding that even when young, "I never really wanted to be a girl, I wanted to be a woman". Often described as "American fashion's godmother" the US dream of hard work and success "is an essential part of her lore" she is married to a quintessentially American media tycoon, Barry Diller. But she still feels European.

Born Diane Halfin in post-war Brussels, the daughter of Jewish immigrants still "traumatised by their experiences in the Holocaust", she was sent to boarding school in England, says the Financial Times. She later studied economics at the University of Geneva where, aged 19, she met the Austro-German, Prince Egon von Furstenberg, heir to a noble family whose roots dated back to the 11th century and nephew of the legendary Fiat chairman, Gianni Agnelli. They married soon after.

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It turned out to be "a heady whirlwind" of a relationship, says The Mail on Sunday: the glamorous globe-trotting prince and princess packed two children and a divorce into three years. But in their prime, the couple were the toast of Park Avenue, throwing parties for Yves Saint Laurent and Bernardo Bertolucci, and sitting for Andy Warhol. Shortly after they appeared on the cover of New York magazine, under the headline "The Couple That Has Everything" in 1973, Egon moved out.

The end of the marriage issued in a period of celebrity trysts for von Furstenberg, who was linked with everyone from Warren Beatty and Ryan O'Neal to Richard Gere. It also proved her making as a designer. Having spent time after university working with Ferretti in Italy, she persuaded him to let her put together a sample of designs using his printed jersey fabrics.

The idea for the dress came when she saw Julie Nixon daughter of the disgraced president wearing the wrap top with the skirt on TV and thought of combining them in a single garment. After Vogue editor Diana Vreeland embraced it, it became a sensation a sexy "symbol of female liberation", says Forbes, that put von Furstenberg on the cover of Newsweek at the age of 27.

Inevitably, perhaps, the company overreached itself. By the mid-1980s the Wrap was out of style and von Furstenberg was badly in debt, and forced to sell her brand name to all comers. A particular low point, says Interview Magazine, was the descent to "Diane von Furstenberg paper towels", complete with signature. They're probably "collectors' items now".

How she bounced back from bankruptcy

"She created a simple product that nobody knew they wanted." Von Furstenberg's company DVF (co-owned with her husband Barry Diller and her two children) may not make the billions that Apple reaps each year, but the "iconic wrap dress has endured decades longer than any single tech gadget".

Von Furstenberg isn't one to go on about her triumphs and disasters, says Alexandra Wolfe in The Wall Street Journal. Asked how she brought her business back from near-bankruptcy and dissolution, she replies, yawning, "It's in the book" (her autobiography, The Woman I Wanted to Be). Still, she wasn't afraid to get down and dirty, says Larissa MacFarquhar in The New Yorker.

Having crawled out "from under a staggering amount of debt" and bought back her brand, she began selling cut-price ranges on QVC and the Home Shopping Network in the 1990s. She probably owes her big break as a self-described "comeback kid" to our fascination with "the decade that style was supposed to forget", says Harriet Quick in the FT. The mid-1990s revival was boosted by Madonna and Gwyneth Paltrow rediscovering the wrap.

Von Furstenberg, who now claims to be in her "legacy" phase, "is focused on building a company to outlast any fad", says Liz Welch on Inc.com. Hence perhaps her recent forays into TV. Her reality show, House of DVF, which follows a group of young women competing to become a DVF brand ambassador, is in its second series.

Whatever form any new lines of business take, she says, the ethos of the wrap dress remains paramount. "I have to make sure that I have carved into our DNA all the things the dress stands for: empowerment, sexiness, effortlessness."