Watch out Paul Smith and Etro, Robert Graham is gunning for a piece of your business.
Earlier this week, the men’s wear brand, which has built a reported $100 million business on the strength of its colorfully patterned woven shirts, got a big cash infusion from Tengram Capital Partners LLC, the successor fund to Windsong Brands LLC, designed to catapult the brand to the next level.
At the same time, Michael Buckley, a 25-year apparel industry veteran who served most recently as president of True Religion Apparel Inc., was named chief executive officer. He will be responsible for all operations and growth initiatives including domestic wholesale, retail, e-commerce, licensing and international distribution.
Bill Sweedler, co-founder of Tengram, said his goal in investing in the business is “to foster, support and build” the “American eclectic” brand. “We’re helping to provide guidance and capital to Michael and his team as they build a five-year plan to grow Robert Graham into a true international competitor to Paul Smith and Etro.”
This is the first deal for Tengram, which is in the market raising $200 million to invest in consumer products companies, Sweedler said, without revealing the amount invested in Robert Graham.
“We made a significant investment into Robert Graham to acquire equity and provide working capital to bulk up the product offering in the existing distribution channels and the infrastructure to expand” into other classifications, he said, pointing to denim, tailored clothing and footwear. “Tailored clothing is a natural for this brand,” he said.
What appealed to him about Robert Graham, he said, was the business that founder and designer Robert Stock and his team, including president Neal Kusnetz, have built over the past decade. The brand has evolved from just woven shirts into “a true American lifestyle brand,” Sweedler said, “with a very strong following among 35- to 50-year-old men. One of the unique attributes is that these men seek out the product for themselves.”
He said the final piece of the puzzle was the ability to bring Buckley on board. “We were lucky enough to find Michael very early in the process to be the leader for the next chapter,” Sweedler said.
In an interview at the company’s offices, Stock said about a year ago he realized the firm had a “need for more capital. We’ve grown dramatically over the last few years and we knew that to take the business to the next level, we needed to bring in partners.” The brand now offers knitwear, pants, shorts, jackets, ties, cuff links, belts, hats, scarves, gloves and hosiery.
Buckley said expanding into denim is expected to be among the first initiatives. Suits, shoes, fragrances and home furnishings are also key growth opportunities.
The company also offers a women’s collection, but Buckley said the plan is to “expand men’s to a full collection, and once that is checking at retail, we will invest in women’s.”
In addition, “to survive long-term, we have to start opening retail stores.” Robert Graham currently operates one unit in Venice, Calif. Buckley said e-commerce as well as further international distribution is also in the cards. “We see this as a very strong brand,” he said. “And this is the tipping point.”
Buckley said the goal is to “double or triple the business over the next three to five years.”
The brand is carried in more than 1,500 doors globally in countries including Austria, Belgium, Canada, Dubai, Germany, India, Indonesia, Malaysia, Switzerland, the Dominican Republic, the Netherlands, the Republic of Ireland and the U.K.
Stock said he’s not concerned about losing control with the new team coming on board. “I feel like there’s been a weight taken off my shoulders,” he said. “It actually frees me up to do what I want to do. I love being involved with product.”
In addition to Stock and Kusnetz, who will continue in their roles, chief operating officer Chuck Hellman will also remain with the company.
Janki Lalani Gandhi, vice president at The Sage Group, the investment banking firm that represented Robert Graham, said, “The background and experience of the executives at Tengram made the shareholders very comfortable because of similar ideas with how they all see the company growing in the future, and that’s why they chose Tengram.”
Tengram also has investments in Ellen Tracy, Caribbean Joe, Joe’s Jeans, Carlos Falchi and other fashion brands.
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