Astor & Black has gotten a cash infusion.
The custom clothier, founded in 2005 by David Schottenstein, has received an undisclosed investment by Massachusetts-based Castanea Partners, a $575 million private equity firm that last month purchased a majority interest in footwear manufacturer Donald J Pliner. The company also owns cosmetics firm Urban Decay. This is its first foray into men’s wear. “It’s like acquiring an entire wardrobe,” said Brian Knez, managing partner.
Terms were not disclosed, but Castanea generally invests between $15 million and $75 million in companies within its portfolio.
Astor & Black employs a staff of 100 direct sales specialists who visit customers in their homes or offices and fit them for full canvas, custom suits and furnishings. Hand-picked stitching, functioning buttonholes and Bemberg silk linings are standard on all garments, and the firm offers thousands of fabric choices from mills including Dormeuil, Marzoni and Scabal. The average price of a suit is around $1,000, according to Christian Boehm, president of Astor & Black, but opening price-point models are available for as low as $499. The company, which also offers sportswear, accessories and women’s wear, has an online business as well.
As part of the deal, Schottenstein will continue to head the business and will retain a significant equity interest.
“We could not have been paired with a better partner,” Schottenstein said. “We’ve been doubling our size every year, but we’re still small. So we look at this as a real opportunity to grow.”
Reports put the company’s volume at more than $20 million in 2010, and Boehm said sales this year are projected to reach $35 million to $50 million.
“We still have the same goal, to be the number-one custom clothier in the country,” Schottenstein said. “We’re just going to continue what we’re doing, but we now have the resources to add executives to the team and make other investments.” Boehm said the company will add people in sales, recruitment, merchandising, finance and e-commerce. “We’re looking for the right people in various areas,” he said.
Boehm said international expansion is also in the offing and Astor & Black will expand into London this spring. The company already operates in Melbourne, Australia, as well as Canada. “International is a booming market,” Boehm said, noting that the new association with Castanea “will help us take the brand to the next level. It’s run by some of the best people in the business,” including former Neiman Marcus co-chief executive officer Robert Smith.
Knez said the appeal of the company is that it is “run by a really dynamic, young, brilliant entrepreneur. He has reinvented the custom clothing category, which is the fastest growing category in the men’s market today. The business provides an excellent value proposition, good quality and service. The business model is good, it’s quite profitable and has good cash flow.”
He said the company also has created strong customer loyalty, which is another advantage.
“The model is superappealing,” he said. “And there is additional growth opportunity there.”
Troy Stanfield, a partner with Castanea, added: “The business has significant wind at its back as the apparel market continues to see a rapid trend towards customization. There is a meaningful opportunity to accelerate growth by implementing digital strategies that heighten the customer’s experience and convey the Astor & Black value proposition to potential customers.”
Schottenstein is a member of the Columbus, Ohio-based family of the same name that founded the Schottenstein Stores Corp. “I didn’t go into the family business,” he said. “But I guess it’s in my blood, I can’t shake it.”