Discussions about the fashion industry thread

[cb200]

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[ValidusLA]

Our factories in Guangdong and Jiangsu are reopening Monday.

People in Hubei are likely pretty screwed - looking like everyone else might be fine.

 

[Todd Shelton]

Outdoor voices founder steps down as CEO. I think she had a good idea and the timing was right for her brand. Seems I'm reading more about young DTC brands taking a lot of VC money, not knowing exactly how to manage that money, and getting into trouble. I would've liked to have seen her go a bit slower and build on the niche, unique brand she started instead of talking about going mass-market, etc.

- $60 million in funding since 2014
- $2 million a month burn rate in 2019, with $40 million in annual sales
- APC's Jean Touitou invested in 2016
- Mickey Drexler was an investor and chairman of the board in 2017 but resigned after concerns about the brand in 2019

Paywall

Inside the Outdoor Voices Saga

Existing investors, including General Catalyst, have provided a lifeline for the activewear label, which continues to lose money on customer acquisition as it struggles to broaden its audience.

www.businessoffashion.com

 

[cb200]

Not surprised at the removal of the CEO. Taking on investors is good as it demands accountability and results in a way that may not be part of the operational core of a clothing brand. And it can really help finance growth for a DTC brand when they can't use traditional forms of financing like factoring. They jumped over a big chasm from 7 to 8 figures in sales with that financing. Many won't cross that chasm- ever even with extra cash. But the timelines and returns needed for "big" VC investors - I don't think work for apparel. The clock starts for an exit, of some sort, the day funding rounds get announced. I'm guessing the phrase "the next lululemon" is getting mothballed from pitches to investors from now on.

 

[ValidusLA]

Besides working in private label fashion, I also am (lightly involved) in a mobile gambling startup.

Problem with all these startups is they spend money like sailors in port.

Best offices, best furniture, best everything.

Like us.... we have 100 employees in california in a warehouse and an old school office. Then we have 4 salesmen in a ridiculous times square showroom. Only one of those 3 places is fancy.

As an investor I would never back an apparel startup. Tech is at least in silly money, but given the environment around apparel, production chain, market saturation etc I cant imagine throwing money at a new DTC.

 

[LA Guy]

Problem with all these startups is they spend money like sailors in port.

Best offices, best furniture, best everything.

I've seen this, and I think that a lot of it is that the money is given out too freely, to people who are too young and inexperienced. I've seen this a lot. There is basically no reason you need an office fill of Aeron chairs and expensive leather furniture and free beverages and whatever non-productive crap fills some Stanford grad's start up wet dream. It should come as no surprise, either. I mean, these are guys, 25-28, and they have a good idea, but they've been previously living staying in a dive and subsisting on ramen. Getting VC backing feels like the equivalent of winning Powerball, and guys act as if they have.

One thing that I've always liked about Amazon (should have invested earlier than I did) is that at core, their two earners - consumer retail and web hosting, are low margin businesses, and force fiscal restraint. A lot of other companies, with high margins, it's pretty easy to lose sight of what is a good and what is a bad expense.

 

[bry2000]

Amazon was never lacking for capital or access to capital.

These newly funded startups spend like crazy not only because of vanity but also because they believe they need to offer the perks and amenities to attract talent. They believe they are signaling success by having the right office decor, catered meals, etc. And because the other firms competing for the same workers are probably offering those perks and amenities as well. Bit of a wasteful arms race.

 

[happyriverz]

The world is awash in dry powder looking for yield, so the startups are just meeting a demand.

 

[LA Guy]

Amazon was never lacking for capital or access to capital.

These newly funded startups spend like crazy not only because of vanity but also because they believe they need to offer the perks and amenities to attract talent. They believe they are signaling success by having the right office decor, catered meals, etc. And because the other firms competing for the same workers are probably offering those perks and amenities as well. Bit of a wasteful arms race.

I feel that it’s diminishing returns. I see it happening on Series B or later funding. That means that you already have your gang of killers, and anyone who will join that core group is not going to come aboard because of the excellent treats or the sweet offices.

 

[bry2000]

I feel that it’s diminishing returns. I see it happening on Series B or later funding. That means that you already have your gang of killers, and anyone who will join that core group is not going to come aboard because of the excellent treats or the sweet offices.

Remember we are essentially talking about millennials.

 

[smittycl]

Raf Simons Becomes Co-Creative Director at Prada (Published 2020)

The move, which could reshape the fashion universe, will be the first such long-term power-sharing by creative equals at a major public brand.

www.nytimes.com

 

[GG Allin]

Raf Simons Becomes Co-Creative Director at Prada (Published 2020)

The move, which could reshape the fashion universe, will be the first such long-term power-sharing by creative equals at a major public brand.

www.nytimes.com

I feel like this is terrible news.

 

[Nyarlathotep]

Raf has that kiss of death.

 

[sushijerk]

Prada hiring frank Ocean and Raf truly reveals it is chasing a customer whose entire concept of high fashion comes from hypebeast blog sites.

 

[OccultaVexillum]

I like Prada, i'm indifferent on Raf.
Well, actually that's not true. I think he's very overrated and hasn't done anything consistently good outside of his time at Jil, but i attribute that more to my tastes rather than his talent.

I think Prada is probably more in line with Rafs aethetic than Jil or even CK were though.