In an interview with WWD, the hip-hop mogul said he has sold his 25 percent stake in the company for $30 million and is now in the midst of what he calls his "evolution." Simply stated, Dash said Rocawear is no longer reflective of who he is.
Instead, his focus has shifted to the companies he has retained: the contemporary line Rachel Roy; the Damon Dash Collection, a men's wear line; State Property, a men's sportswear line; Team Roc, a collection of athletic apparel, and the license for the footwear line, Pro Keds.
"In the past five years, I've learned so much and made so much money that I don't feel any animosity. We've all prospered," Dash, 34, said of his partners, hip-hop star Shawn "Jay-Z" Carter and Russian investors Alex Bize and Norton Cher of the Comet Group, a clothing manufacturer. Dash said the current wholesale volume of Rocawear is $350 million, with about $230 million coming from Rocawear's women's apparel sales.
Dressed in a navy blue suit from the Damon Dash Collection, he sat in his soon-to-be-vacated corner office at 1411 Broadway here and spoke matter-of-factly of why he wanted to sell and how he knew the timing was right.
"I feel like my partners don't understand what I'm trying to represent. We were getting a bit too demographic," Dash said. "I also think my partners, but not Jay — he wasn't really active as far as the business went — were thinking I was using Rocawear to fund my lifestyle. I think they felt like I was using Rocawear money to fund everything else I was doing when, in actuality, I was funding other companies, like America magazine, out of my own pocket," he said, citing the luxury magazine he launched last year.
The 25 percent of the company Dash owned was sold to the remaining partners. "They got a loan to buy me out. I think we constructed a creative deal and we're all happy," he said.
"At least," he added, "I hope we're all happy. I don't know what they're going to do with my 25 percent, but I don't even care. Just give me my money."Carter was unavailable for comment, but Bize, one of the founding partners said, "Working alongside Damon to build Rocawear into a thriving and successful business has been a great experience. We appreciate everything that Damon has done for the brand and wish him well in his future endeavors."
In an interview with Carter earlier this month, he said his plan is to grow Rocawear, not sell it like his contemporary, Russell Simmons, who sold his Phat Fashions to Kellwood Co. for $140 million last year. "You don't want to have [Rocawear] everywhere so that it's not special, but you don't want to be exclusive where it's not for everyone. We don't want to bastardize the brand or whore it out," he said. "It's like when I was making records. You don't want to make a song that's too commercial where everyone is throwing rocks at you, but you don't want to make such an underground record where you can't sell records. I've been walking that fine line my whole career," he said. "I like it."
But Carter, according to Dash, wasn't always willing and able to be involved with the company.
"Jay came to the office once, maybe twice, per year. If we were lucky," Dash said. "If I asked him to be in the campaign, it couldn't happen. He would never do it. Why? I don't know. Honestly, I never knew. So then I had to become the marketer and the vocal person and the spokesman and that wasn't initially what I wanted to do. That was his job and it was something he didn't want to do. But now, he wants to and I'm cool with it. How could I be mad? I'm walking away with all that money, those companies and so much knowledge."
The moment Dash knew he and his partners were moving in opposite directions was immediately following the launch of this past spring's advertising campaign for Rocawear, which featured friends and collaborators of Dash, including Kevin Bacon, Cam'ron, Karolina Kurkova and Naomi Campbell.
"I tried to have all the right people be spokespeople for the right tiers of distribution represented in one shot. They couldn't understand why I wanted to have Kevin Bacon and Naomi Campbell — people who didn't wear Rocawear — in the ads for Rocawear, but to me, the brand should be reflective of your lifestyle. And it should be real. This is all Damon Dash," he said.In fact, this could have been a day in his life. After all, Bacon starred in "The Woodsman," a film Dash co-produced, Kurkova vacations with Dash and his family, and Dash said Campbell and he have such a close friendship that she's "like a sister" to him. For Dash, this campaign symbolized where he wanted the brand to go, but he claimed his partners weren't on the same page. Maybe, he said, it was because other Dash properties were featured in the ad. Stars were sipping Armadale vodka, owned by Dash, and wearing suits from the Damon Dash Collection and watches from his Tiret New York luxury watch collection.
"To a degree, I can understand why my partners might not be into it because they didn't own Armadale and Tiret, but the way I look at it, if we're going to have a luxury watch on, why can't it be the one I own?" he asked.
Immediately following the launch of the spring campaign, Dash stopped fulfilling his duties at Rocawear. However, the job description he had prior to the campaign was entirely different from the one he had when he and Carter co-founded the company five years ago.
"In the beginning, my job was to do the production aspect of it," Dash said. "We wanted Jay to wear Rocawear and speak about it in his rhymes and what he did was more valuable than gold. But then we had this unscheduled growth and we went from $8 million to $80 million and we weren't prepared for it. We were still losing money and I was like, 'How could that be? How can you do $80 million and still be taking a loss?'"
That's when Dash's duties began to change. He began to learn about financing and tiers of distribution. "I walked in here thinking we were going to do $100 million and everyone was like, 'We'll be lucky if we do $25 million,'" Dash said. "Then when it happened, we weren't prepared, so we had to redo the whole infrastructure of the company to facilitate those demands. I felt like I was doing too much.
"Jay's part is necessary. You needed him to be the face of the company. He pulled his weight. But, if you know anything about the clothing business, you know that no one is putting up their own money, they just have a relationship with the bank," he said of his two partners, Bize and Cher. "I was like, 'Damn, I've given up half my company, just because someone has a connection with a bank?' I could hire a chief financial officer to work with the bank. And now, I understand those factors, like rolling debt and working capital. So if I was working that part of it and also having to deal with production, marketing and design, why am I only getting 25 percent? I was feeling like a slave."But from the beginning of the summer, Carter seems to be taking a more direct role in the brand, calling himself "the editor" of Rocawear, a move that surprised Dash and moves him to speak nostalgically about the days when the two launched the company. "It's amusing to see Jay play a different role. If he were doing all that he does now back then ... Oh man," he said, smiling and leaning back in his chair.
Dash believes he's left the remaining partners with a solid blueprint as to how to run the company, something he says he's been doing all along. "We'd all be sitting around talking about the clothing and I'd be like, 'Well, none of y'all wear the clothes, so how are you going to tell me about it?'" he said. The Rocawear offices will stay in the same location at 1411 Broadway with all the licensees under one roof, a concept Dash said he implemented. Dash, however, is moving to a new location across the street.
A further glimpse inside Dash's business perspective can be seen on his new television series, "The Ultimate Hustler," which premieres on the BET network on Oct. 4. In this "Apprentice"-like reality show, Dash seeks out the savviest hustler and awards him or her by making his or her business plan a reality.
Business for Dash, however, hasn't always been something worth imitating. "All the urban brands were having problems this year and the bank was like, 'You've got to cut all these other side brands like Rachel Roy, Damon Dash Collection and C. Ronson,'" he said. Instead, Dash said he funded them out of his own pocket because he was committed to them. "My integrity and my honor mean everything to me," he said. "That might be my problem in business."
The C. Ronson label, which Dash purchased in 2003 and sold earlier this year, was something he admitted to never really understanding. "I just couldn't figure out the young contemporary business. She [Charlotte Ronson] knew my lack of knowledge with the young contemporary category, but I couldn't figure out how to make money outside of the boutique stores. Her clothes are great and she does good business in Japan, but I felt like C. Ronson was the guinea pig. It was a business I believed in and I still do, but I'm not going to make the same mistakes with Rachel [Roy]," he said.After the sale, Roy, who is Dash's wife, will leave her position as creative director for Rocawear women's and children's wear. At least, he expects her to. "When I leave, I would think ... well, what do you think is going to happen?" he asked. "She was doing Rocawear for me, and I don't think the brand represents her direction either. Whatever I do, she'll be the creative director for it," Dash said. "She's the only person I trust to tell me what's right and wrong in women's fashion."
Dash said another low point came last year when he had to fire roughly 20 Rocawear employees. Now, Rocawear employs 110 people. "That's the worst thing you've got to do," he said. "I didn't want to do it, but the banks made me do it."
The urban category, though, is still a work in progress, he believes. "There's no protocol for it. All of us — Ecko, Sean John, Phat Farm — we're trying to figure it out and take it to the next level, but none of us has done it. We're all just stuck. It's like we've saturated one demographic and we have to figure out how to grow the business. We all want a billion-dollar business, but none of us can get past half a billion.
"I want just one of us to be worth $600 million. Is it possible?" he asked coyly. "I've got it figured out. Give me a year. Let's talk in a year. I know how to survive."
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