Fast-growing digital brand Grana thinks its value play will serve it well as it launches an activewear line and focuses on planting a deeper flag in the U.S. next year.
The two-year-old, Hong Kong-based company, which closed on a $10 million Series A in October, makes women’s and men’s apparel with a focus on selling consumers on fine fabrics — Chinese silks, Japanese denims, Irish linens and Mongolian cashmere among others — at a two- to three-times markup. The company sells direct via its web site, shipping from a central warehouse in Hong Kong.
The company plans to launch the Grana Move activewear line in February, rolling out with eight styles for women priced from $29 to $45 and five styles for men retailing for $25 to $29.
“We’ve always been about the world’s finest fabrics,” said cofounder and chief executive officer Luke Grana. “We think that there is some quality out there [in the activewear segment], but the prices are high, so it’s a really good category for Grana to look at.”
It’ll also keep grease on the wheel so to speak as the young company continues its trajectory.
The business will end this year up 500 percent from the prior year and for 2017 projects growth of about 300 percent. The company expects to break even by the second half of next year, largely investing its money on scaling the business having raised, to date, $16 million from investors such as 500 Startups, Alibaba’s Hong Kong Entrepreneurs Fund, Golden Gate Ventures and MindWorks Ventures.
Grana, which has seen sales grow 15 percent month-over-month since its start, has done little in the way of traditional advertising relying largely on word of mouth in the U.S., it’s second largest market after Hong Kong. That will change come as early as May when the company dips its toe into physical retail Stateside with a temporary shop, possibly in SoHo. A lease has yet to be signed.
The showroom concept will allow visitors to try merchandise on and then order it from in-store computers. Product will then be shipped from Hong Kong for free back to the store for pick up or to the customer’s home.
The company since it’s founding has launched 10 pop-ups in four countries.
“It’s a great way for us to communicate with our community and to learn from them as well,” Grana said. “We see it as a really important short- to medium-term brand-building exercise to reach more people….For us, it’s not a core sales generator. It’s really just a supplementary way to acquire customers.”
The company in the back half of 2017 also plans to open a July pop-up in Shanghai — seen as another key growth market — in addition to the launch of outwear, bags, accessories and shoes.
As the company continues to expand — whether at physical retail or in product categories — Grana is keen on staying true to the company’s roots in digital.
“Grana was born online only,” the ceo said. “We want to scale by e-commerce.”