LONDON, United Kingdom — Addressing an audience of students at Central Saint Martins last year, Anna Wintour advised: “The only thing I worry a little bit about, going straight from school to starting your own business, is not that many succeed… I personally would advise you to think carefully before you start your own business, and consider possibly working for a designer or a company whose work you admire.”
For every Alexander Wang, who launched his label straight out of school and has gone on to build a commercially successful brand, there’s a Meadham Kirchhoff, a label launched by a pair of designers after graduation, which has since shuttered. And for every Kirchhoff, there are many more labels that never got off the ground to begin with.
According to some in the industry, many young fashion businesses die of the same disease: simply, lack of experience.
“Don’t think that the business aspects of running a brand are not applicable to the designer — they are,” advises Gary Wassner. Wassner is the founder of two companies: Hilldun, a factoring firm that provides young designers with loans and other forms of credit, and Interluxe, an investment firm. Hilldun has financed labels including Marc Jacobs and Tommy Hilfiger. Interluxe has stakes in Jason Wu and Andrea Lieberman’s label A.L.C., and intends to make four or five investments eventually.
“I don’t think designers right out of school understand very well how to merchandise; what gross margin is; how to manage relationships with retailers,” says Wassner. “[The market] is so complicated today that unless you have a support structure around you in a new venture, you’re going to make major mistakes… I think you learn that with experience at other brands.”
French designer Alexandre Mattiussi has seen both sides of the coin. AMI, his Paris-based menswear label, launched in 2011 and gained traction quickly. In its first four seasons, sales grew by at least 50 percent each season and the brand built up 120 points of sale. Today, it has 300.
However, Mattiussi first attempted to launch his own brand in 2002, about a year after he graduated from the Duperré School of Applied Arts in Paris. “I didn’t know anything,” he says. (He was 22 at the time, and had spent over a year working at Dior on the house’s classic menswear line.) “I think it’s a great experience to realise you’re too young… I was doing everything: collection, production, deliveries, invoicing, press. It was really hard.”
After two years, Mattiussi packed it in and went to Givenchy, where he spent five years and worked with creative director Riccardo Tisci on his first menswear collection for the LVMH-owned house. He recalls regular meetings with the production, sales and commercial staff. Each week, he met with Marco Gobbetti, who oversaw Givenchy Couture (and is now chief executive of Céline), to show the collection and discuss its positioning in the market.
After another year designing menswear at Marc Jacobs, AMI was born. Mattiussi recalls: “I said, ‘Okay, I think I have understood the most important things: you have to have a team, you can’t work alone. You really have to have investment, so you have to think about a business plan. You have to think about fabrics and production, understand where your products are going to be made. You have to think about where to market and sell the collections,’” he says.
Things were very different second time around. AMI launched with a team of three, and Mattiussi quickly hired a sales manager and production manager. He took on PR firm KCD. And he found investment (AMI declined to comment on its investment). Today, AMI has a team of 50.
“The time of self taught maestros has come and gone,” says Luca Solca, head of luxury goods at Exane BNP Paribas, who spent 12 years as a consultant to luxury goods and consumer companies. “[Working at] a big brand helps [a designer] to learn how various functions work together with the designer: merchandising, retail, wholesale, communication, PR.”
Once in a while, a young label emerges from the woodwork and makes the fashion industry stand to attention. Last September in New York, that label was Monse. Monse’s first-ever fashion show was attended by Domenico De Sole, chairman of Tom Ford International, Alex Bolen, chief executive officer of Oscar de la Renta, and designers Prabal Gurung and Wes Gordon. The collection — which Cathy Horyn called "an excellent first collection” — was picked up by stockists including Net-a-Porter, Bergdorf Goodman and Neiman Marcus.
However, while the the label launched less than a year ago, Laura Kim and Fernando Garcia, its co-founders and designers, are old hands, having spent 12 and six years on the design team at Oscar de la Renta, respectively.
“To be honest, I don’t know how other young brands can start without any business experience,” says Kim, who joined Oscar de la Renta shortly after graduating and worked her way up to design director. “Oscar kept me in the loop on everything: production, retail, sales, I was always sitting in the meetings with him. He always had me included in picking new vice presidents in any kind of department.”
“At school they push you to be creative, which I think is great, to be one of the only times that you can experiment and be crazy,” she adds. “But at work, we see the numbers and we see the merchandisers’ report, and you really learn what works, what’s moving and what isn’t.”
Kim says she toyed with the idea of launching a brand earlier, but “I didn’t feel I was ready until I can cover the sales part; the production part; I knew enough about the business; how to ship to department stores…”
Before launching Monse, Kim and Garcia took their designs — and their business plan — to editors, stylists and buyers they knew from Oscar de la Renta, as well as industry figures like Net-a-Porter’s Sarah Rutson. Monse launched with a five-year business plan that mapped out “how much we were going to spend, our PNL [profit and loss], our product merchandising plan, how to get to the price points we were aiming for. We actually priced out our entire line… if we’re going to sell a dress for $2,000, we have to work backwards: how much fabric can I buy, what fabric am I buying, what are the factories?” says Kim.
“We wouldn’t have done it not knowing that we would be supported by the people that run the industry,” adds Garcia. “You need somebody who has seen you work for someone else and trusts you — to have their opinion out there, it snowballs from there.”
Inexperience can lead to mistakes that hamper a business’s longevity — the most fatal of which, Gary Wassner says, is “not understanding the importance of constantly having a cashflow.” And this is something investors take note of: “If the individual running the company doesn’t have experience other than design experience, you either want to put in a team that does, or you would not make the investment because it’s just not logical,” says Wassner.
“It is nearly impossible to just learn things by doing them, without having been exposed to the best practices,” adds high-powered headhunter Floriane de Saint Pierre, who placed Christopher Bailey at Burberry and Alber Elbaz at Guy Laroche. “You need to get prepared as much as you can.”
Wassner, who also teaches at the Fordham University Fashion Law Institute, advises aspiring designers to soak up whatever experience they can: “Intern while you’re in school. Get as much experience as you possibly can, in a small company where you can really get a feel for what it takes to get a company going,” he says. “At brands that are under $20 million, there’s a lot of shared responsibility within the team, because you’re talking anywhere from 15 to 50 employees. You learn much, much more.”
Editor's note: This article was revised on 18 March 2016. A previous version of this article misstated that headhunter Floriane de Saint Pierre matched Narciso Rodriguez with Calvin Klein. This is incorrect.
Editor's Note: This article was revised on 23 March 2016. An earlier version of this article mischaracterised the state of Gareth Pugh's business.