TOKYO — Nigo, the fashion and music impresario who founded Japanese street label A Bathing Ape, openly admits he’s never really had a head for business. That partially explains why Hong Kong-based retailer I.T Ltd. managed to snap up 90 percent of his company Nowhere Co. for just 230 million Japanese yen, or $2.8 million at average exchange rates. The company, which owns the brand known as Bape, has posted losses for the past two fiscal years and has racked up its share of debt.
This story first appeared in the February 7, 2011 issue of WWD. Subscribe Today.
Although Nigo downplayed the severity of Nowhere’s financial situation — even to the extent that he denied the company is actually losing money — he acknowledged that dealing with the administrative side of running a business has never been his strong suit.
“The company itself wasn’t in a very dire situation, but in the end I spent so much time looking after the management side that I wasn’t really able to do design,” he told WWD during an interview at his personal atelier, packed with what is only a portion of his extensive collection of vintage toys, art, pop culture artifacts and designer furniture. A statue of Colonel Sanders greets visitors at the entrance, and the space downstairs houses no less than a vintage Coca-Cola vending machine, a jukebox, a giant Apple Computer logo sign in neon lights and a series of paintings by New York-based artist Kaws featuring the Simpsons characters with missing eyes.
“Basically, I can’t do business. I’m not suited for it. I wish I had had a partner on the business side from the beginning,” said a surprisingly upbeat Nigo, whose real name is Tomoaki Nagao. The music and fashion impresario said he always thought he would sell the company he incorporated in 1995.
“I turned 40 [last December], there was the turning point of the brand reaching nearly 20 years since its establishment, and I think I made a forward-looking choice,” he said, acknowledging the brand’s popularity in Japan has faded in recent years. “About two or three years ago the brand and the company got too big for me to handle, plus there was the problem with the economy, and the number of things I wasn’t able to control on my own increased, so I started looking for a partner.”
Nigo said sales for the year ended Aug. 31 totaled about 5 billion yen, or $55.5 million. He said sales peaked in the 2006 to 2007 period, when Nowhere was registering an annual volume of about 7.5 billion yen, or $63 million.
In April 2009, Nigo stepped down as president and director of Nowhere in an effort to bring in more formal management, but that was a short-lived arrangement and he resumed his role at the helm of the company only a few months later.
I.T has said Nowhere posted a loss of 267.43 million yen, or $2.78 million, for the fiscal year ended Aug. 31, 2009, and a loss of 119.05 million yen, or $1.32 million, for the year ended Aug. 31, 2010. Dollar figures were converted at average exchange rates for the periods to which they refer.
But Nigo expressed a different take on the numbers. “The accounting base is different, so I don’t think we made a loss. It’s difficult [to say]. But I never missed payments or delayed paying employees’ salaries,” he said, adding he’s kept his personal fortune and the company’s coffers separate.
Nowhere had net liabilities of 1.25 billion yen, or $13.88 million, as of Aug. 31. Also, I.T is taking on about 4.31 billion yen, or $52.79 million, of Nowhere’s outstanding bank loans and shop leases.
“I definitely didn’t want to file [for bankruptcy] under the Civil Rehabilitation Law, and I didn’t want to damage the brand,” Nigo said. “I had a strong feeling that I wanted the brand to survive, so the main thing was thinking what to do about that. I spent 20 years building it up, so it would be a real shame for it to disappear.”
As for the future of Bape, Nigo thinks I.T is the best company to grow the brand. Over recent years, Bape’s popularity has grown tremendously in China, even as the buzz has died down in Japan.
Nigo has agreed to serve I.T as Bape’s creative director for an initial period of two years, but he said he hopes his involvement continues beyond that.
In addition to his new role in I.T’s Nowhere, Nigo said he would continue working on his other projects, including his partnership with singer-producer Pharrell Williams on the Billionaire Boys Club and Ice Cream brands, which are part of a separate venture.