The team at Athletic Propulsion Labs operates off the mantra “solidify before we diversify,” and with the business now seeing rapid growth, the Los Angeles firm is moving to larger headquarters as it readies for entry into retail.
APL, founded by twin brothers Ryan and Adam Goldston, is set to move into 15,000-square-foot headquarters in March with its team of 12 at the Row DTLA mixed-use complex in downtown. The new space is roughly two-and-a-half times the size of the company’s current offices.
“We honestly couldn’t be more excited about what the future holds for us,” Ryan said. “It’ll complete the circle in terms of where we believe we’re at and where we obviously think our consumers believe we’re at. We started this company in our dorm room and worked in such a small place for a long time. To be at the position where we are today, this honestly is just the beginning.”
APL got its start in performance footwear, first selling direct online in 2010 with the Concept 1 basketball shoe, which the National Basketball Association banned due to its ability to help wearers jump higher. The company later expanded into men’s and women’s running shoes and a wholesale business. In late 2016 APL made its move into apparel and today is sold at more than 100 retailers globally, including Barneys New York, Saks Fifth Avenue, Net-a-porter, Shopbop, Theory and Lane Crawford.
The Goldstons have given the new headquarters a stark white interior from floor to ceiling, anchored with concrete floors and decor by RH Modern. A 42-foot table will run down the center of the office to give employees a communal area to work. There will also be lounge areas and conference rooms.
The headquarters move will be followed by the opening of the company’s first store at the headquarters in May, offering about 1,000 square feet of selling space.
The firm is not committing to a size it thinks APL retail can get to, largely reflective of most companies’ strategies bucking the long-term lease and rollout mentality in favor of opening experiential doors where there’s already a confirmed follower base backed by metrics.
“You’re not going to see us open 40 stores at once, but we definitely have a global vision,” Adam said. “We’re starting off with this one proof of concept….We try not to get ahead of ourselves in terms of the future. You won’t see us at this point saying ‘This is what our five-year plan is’ because things change so much along the way. You have to be able to react to the situations that present themselves, the opportunities that present themselves. What we need to make sure is that we do something that’s impactful.”
The APL team got a taste of retail in August when it launched its footwear at select Lululemon doors, testing different shop-in-shop concepts ranging from a traditional showroom model to hybrid store-showroom concepts.
Around 40 Lululemon stores now carry anywhere from 24 to 32 APL stockkeeping units, in addition to Lululemon’s web store.
“The biggest takeaway we got from [Lululemon] was just the experience they provide and the educators they have working in the stores,” Ryan said. “Just seeing what a great job these educators do and how passionate they are shows you why they have such success right now. Within the retail environment, there are a lot of people struggling and they’re doing great….At this point for our company we don’t have our own retail stores yet, but the employees we have working for the company are so incredibly valuable to us. Realizing that we have to put the same type of premium on the people that work in the stores and truly make them feel that they’re vital parts of the company — which they are — we hadn’t seen done on a scale like [at Lululemon] where someone had executed it so well.”
The Goldstons are ambitious in what they want for APL, setting a goal early on to grow as large as possible with as few people as possible. Starting off as a direct-to-consumer online brand has helped. The two founders now aim to build a $1 billion business with less than 30 employees.
“We built this super scalable retail model. A lot of times companies bring on excess amounts of people,” said Adam. “We added the Lululemon account and we’re now in 40-plus stores. We didn’t have to bring on a single employee just because of the system we created. We built a digital model. The numbers get bigger but it doesn’t get more complicated and that’s something we believe in because we believe the business model of the future is hyper-scalable. This wouldn’t have been possible 15, 20 years ago.”
APL clearly doesn’t look at the size of its workforce as a measure of business success.“The way that we’ve decided to look at success in how we’ve grown our business is, one, what are the sales per employee as opposed to just looking at the number of employees you have,” Ryan said. “And then the quality of life that you’re able to provide for everyone at your company. We’re just able to function differently and it’s because how we set out to do it from the beginning. We’re on that path. We’ve had tremendous growth and we’ve been able to do it exactly how we wanted to.”
While the company doesn’t break out its revenue, it has managed to triple the figure each year since 2013 and notched the same gain in 2017. That growth wasn’t just the result of a few new accounts; it was across the board from wholesale to APL’s own e-commerce, the siblings said. As an independent shoe company, APL sits in an interesting niche where its obsession with performance intersects with a luxury aesthetic that’s allowed it to successfully sell $700 bomber jackets. The brand from the start has steered clear of gaudy logos, also operating outside the hype and hysteria tied up in sneaker culture.
“We can grow at the rate that we’re comfortable with,” Adam said. “We set out on these goals and we say ‘This is the way we’re going to do it’ and we’re patient because we don’t have to report to anyone about how we’re going to do it.”
“We sit at a very interesting point in that our stuff is technical in nature, but most people who buy it aren’t going to do marathons,” Ryan said. “We’re viewed as a luxury brand; we’re also viewed as a performance brand. Both [sectors] have very large markets and so we’re able to live in a very special place….As Adam alluded to, the fact that we’re 100 percent founder-owned and we didn’t have to worry about decisions from other people, meant we could wait for the right time that set us up for a long-term play.”
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