By  on June 8, 2016

Bebe Stores Inc. decided to go big rather than go home.

The women’s specialty chain found a way to leverage its brand equity through a twist in a business model that has it keeping the reins on the operating component of the business — its stores and e-commerce site – and at the same time partner with brand management firm Bluestar Alliance for licensing opportunities for its Bebe and Bebe Sport brands.The publicly traded firm has a joint venture with Bluestar, with the joint venture owning the Bebe trademarks and related intellectual property assets. Bebe has a majority stake in the venture. Bluestar contributed $35 million to the venture, which has since been transferred to Bebe’s coffers. Under the terms of the agreement, Bluestar will leverage its brand management infrastructure to develop a global wholesale lifestyle licensing business for the brand. Fifty percent of the royalties will go to the joint venture, which will be disbursed to Bebe on a quarterly basis. That income stream will give Bebe some breathing room and liquidity to fund its operating model.

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