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Why A.P.C. Invested in Outdoor Voices

Jean Touitou of A.P.C. and Tyler Haney of Outdoor Voices talk to BoF about why their partnership makes perfect business sense.
A still from the A.P.C. x Outdoor Voices Autumn/Winter 2016 campaign video | Source: Courtesy
By
  • Lauren Sherman

NEW YORK, United StatesJean Touitou doesn't consider himself an investor, per se. And yet, he has long supported the work of young talent, helping his stable of designers — including Jessica Ogden, Vanessa Seward and Louis Wong — establish their own labels within the A.P.C. universe. In October 2015, Touitou joined a group of traditional venture capitalists, including General Catalyst and Forerunner Ventures, in backing Outdoor Voices, the New York-based, digital-first activewear company founded in 2013 by Tyler Haney, which has raised a total of $22.5 million in funding to date and does 80 percent of its sales via its e-commerce site.

For Touitou, a potential collaboration — the fruits of which will arrive in Outdoor Voices and A.P.C. stores worldwide on August 31 — is what first drew him to the company, whose aesthetic is aligned with his own. "I very much felt there was an opportunity to free fitness from performance, taking every day activity and finding the beauty in it," Haney told BoF back in April. "We wanted to create product that functions in the same way as that of Nike and Lululemon, but more aesthetically aligned with what I wear day to day, like Acne and A.P.C."

Positioning wise, we outwardly oppose traditional activewear brands.

The investment came later. “We know from experience that if you do a collaboration with a major brand, the decision-making process is too long,” explains Touitou. “It’s really tough to work with big corporations because there are too many layers of people deciding.” In contrast, a speedy, iterative approach is vital to Haney. “Being nimble is the one thing that we have priortised,” she says. “We are very quick to respond and I think the fashion industry has lost that.”

Touitou, whose criticisms of the fashion industry run deep, believes a major shift is taking place, with more brands adopting the digital-first model Haney and her peers pioneered. "It's the same crisis that destroyed the record industry a few years ago. It's an absurd way of functioning. It's too costly and too tiring for everyone," he says, referring to the traditional fashion system. "There are too many fashion shows, too much loss of quality, too many parties. There is a crisis of overproduction. Too much fabulousness. It really is the Warholian nightmare."

Meanwhile, Haney is facing her own challenges. Outdoor Voices continues to drive tremendous growth — with sales up 800 percent in the year ending in April 2016 — and is slated to open two new stores by the end of 2017, which will join existing locations in New York and Austin, Texas. But at the same time, industry analysts have suggested the market for so-called “athleisure” — or activewear worn outside of exercise — is softening. The average selling price of activewear-style leggings decreased 9 percent in the first quarter of 2016 from the same period a year earlier, according to research firm SportsOneSource. The decrease in price was not necessarily made up for in volume; the dollar amount of leggings sold during that same period was down 6 percent. This suggests that activewear brands must be more competitive about price than they have in the past, which could mean more discounting.

But Haney firmly believes that Outdoor Voices sits apart from the competition, not least because of the qualities it shares with A.P.C., including tight control of inventory. “I think that, positioning wise, we outwardly oppose traditional activewear brands,” she says. “A.P.C. does the same thing.”

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