LONDON, United Kingdom — Today, BoF can exclusively reveal that concept store LN-CC, which operates a 5,000 square foot, Gary Card-designed retail and events space in East London alongside a highly curated e-commerce store that ships to over 70 countries, is set to announce a new £2 million round of funding from an undisclosed private investor, at a pre-money valuation of £20 million. While these numbers are small relative to the capital injections and valuations touted in Silicon Valley, they do speak to the potential of niche fashion retailers with a strong point of view. Luxury fashion juggernaut Net-a-Porter.com was valued at £350m in 2010, after ten years in business.
Founded in 2010, with an initial investment of £1.6 million, by a team that includes highly-respected creative director John Skelton, formerly of Oki-ni and Harrods, and buyer Dan Mitchell, who worked alongside Skelton at Oki-ni, LN-CC is known for its progressive buys, stocking underground Japanese streetwear brands like Sasquatchfabrix and Sunsea, as well as rising talents like J.W. Anderson and Tze Goh, alongside globally recognised luxury brands like Lanvin, Jil Sander, Balenciaga, Dries van Noten and Rick Owens.
“We simply buy things that we want to wear,” Skelton told BoF, when asked about the store’s buying strategy. “We [pick] things that we love on a personal level, in a space that we find interesting; there’s no more to it than that,” he continued. “I guess that’s why what we do comes across as being very different, because there aren’t many stores that work like this. Most stores buy product that they think they will be able to sell, which is a completely different approach.”
But sell they do. Since launch, LN-CC has enjoyed triple digit growth each season and is on track to bring in £7 million in revenue this year, with about 70 percent of sales coming from international markets, including the US, Japan, China, South Korea, Australia, France and Germany. Last year, LN-CC opened a 20,000 square foot warehouse and fulfilment centre outside London, and expects to cross over into profitability this month, according to Fraser Harper, the company's chief executive.
The new funding will allow LN-CC to further expand its global reach. “The new investment provides us with an excellent foundation for further growth and value creation. Internationalisation and localisation remain key strategies for LN-CC and we plan to invest in key people and technologies to drive these strategies forward,” the company said in a written statement. Specifically, the retailer plans to evolve its digital presence, embracing new technologies, and add more localised content to its e-commerce site, allowing customers to engage and transact in wide range of languages and currencies.
“E-commerce hasn’t really developed in 10 years. But with the evolution of social media, mobile and video, change is inevitable. We want to be at the forefront of this, adding localisation to every aspect of our development,” said LN-CC’s e-commerce director David Hobson. “Our goal is to offer a unique and progressive platform that allows all visitors from anywhere in the world to engage with us.” LN-CC is currently active on Facebook, Twitter, Tumblr and Pinterest, as well as on targeted social networks in China, Japan and South Korea.
But while LN-CC has focused significant energies online — and does what is thought to be around 80 percent of its sales via e-commerce (LN-CC declined to provide a specific breakdown) — Skelton still believes in the importance of the physical store experience. “The store for us is as important as our website, in that both can do things that the other can’t,” he said. “LN-CC.com obviously has global reach, however technology at the moment is not able to create the feeling or the atmosphere that has been created within our store.”
Indeed, for Skelton, physical retail and e-commerce are highly complementary, with the store providing a rich platform for customer experience worthy of a pilgrimage, while the website acts as a more streamlined and accessible sales tool. “They are almost alter egos in that the site is very minimal, clean and easy to peruse and lets the product do the talking, whereas the store has captured a mood and feeling and interacts with you from the second you enter until the moment you leave. You haven’t had the full LN-CC experience until you have visited the store.”
Vikram Alexei Kansara is Managing Editor of The Business of Fashion