NEW YORK — Fashion firms looking to grow their business should take a good hard look at the value system of their potential partners before finalizing their choices.
That was one key point made by Peter Kim, founder, chief executive officer and president of Hudson Clothing LLC.
Kim was a participant on a professional development panel Tuesday at the Andaz Hotel here on “Growth: The Power of Investment,” hosted by the CFDA and private equity firm Fireman Capital Partners. The panel shed light on what fashion firms need to think about before embarking on finding an investor to grow their businesses. In addition to Kim, panel participants included Marla Sabo, partner at Fireman Capital and a director at Hudson, of which Fireman is a significant stakeholder; Todd Finger, partner at law firm McDermott Will & Emery; Hamilton South, co-founder of HL Group, and William Busko, managing director at Consensus Advisors.
When it comes to aligning with the right partner, Kim said one focus is determining at how the individual looks at life and deals with other people, noting that someone whose goal is to make money will probably clash with someone whose value system is focused first on doing good for society.
“There are points of disagreement that come up in business situations and you want to know how people are going to choose how to address the problem and how you can move forward,” Kim said.
Busko said many firms start looking for a potential partner when their capital needs become critical, but that up-and-coming designers should be meeting with potential investors while they are building and growing their businesses.
One question Finger said he gets asked often is when should a company begin to think about putting together a board of directors, to which his advice is “right now.” He also provided key points on what firms need to do to attract investors, such as how to structure a company and organize key corporate documents.
As for whom should be on a board, the panelists agreed that it should be someone who can provide a healthy dose of common sense, challenging the entrepreneur with ideas and guidance on how to develop and meet both short- and long-term goals.
Sabo, whose fashion background includes stints at Bergdorf Goodman, Saks Fifth Avenue, Hermès and as president and chief operating officer of Christian Dior Couture Americas, worked with Steven Kolb, ceo of CFDA, in putting together the program.
While Kolb isn’t ruling out the possibility of a fund down the road for CFDA’s incubator program, he said the goal of Tuesday’s program was really a first step in bringing investors together with designers.
Nine fashion incubator firms, past and present, were in attendance, including men’s wear designer Antonio Azzuolo. He said, “The program gave a good sense of the investment possibilities and the challenges you face. When art and business come together, it isn’t easy to find the right synergy and alignment. This [program made us think about] who we are and what we want.”
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