After more than three decades with Neiman Marcus and Bergdorf Goodman, Jim Gold has developed an instinct for which brands will break out of an oversaturated apparel market. His latest discovery is Vuori.
Gold, who left the retailer in mid-March, has become an investor and board member in the California-based men’s activewear brand, joining Norwest Venture Partners which invested $45 million in the company in August and became a minority owner.
“Vuori is best positioned to break out and be a $1 billion brand,” Gold predicted over breakfast during a recent visit to New York. Current sales of the privately held company are believed to be around $50 million.
Gold said that after leaving Neiman’s, “I had plenty of time on my hands and I wanted a break from fashion.”
Since exiting Neiman’s, Gold had chosen to get involved with only one other company, Joor, a digital business-to-business wholesale marketplace. But his long history in merchandising is deep in his bones and after a friend gave him a pair of Vuori shorts, he was smitten. “I was surprised that I’d never heard of it,” he said.
Gold went online and started researching the company, and “the more I read, the more intrigued I became.” So he reached out to company founder Joe Kudla and asked him to have lunch.
They met at the company’s headquarters in Encinitas, Calif., where Vuori also operates a brick-and-mortar store, and “it became clear to me that this brand had enormous potential.
“As a merchant, I learned that success comes down to two things,” Gold said. “The product needs to be special, unique and different. And the company needs to be led by someone who can operate the business in a highly profitable way. It’s not often those two things come together. But Vuori has a product offering with a clear DNA that reflects the leader’s vision.”
That leader is Kudla.
A former accountant, Kudla launched Vuori in 2015 to fill a void he saw in the men’s activewear market for workout shorts that could take a man from the gym to lunch. He raised $300,000 from friends and family and created moisture-wicking, quick-drying shorts with a distinctly coastal California aesthetic. He named the brand after the Finnish word for mountain to represent the clarity one gets after a trip to the summit.
The shorts took off and allowed Vuori to expand into more offerings such as joggers, sweats, Ts, chinos and accessories, all produced under its ethos of “Designed to move and sweat in, but styled for everyday life.” This spring, it launched women’s wear under the direction of former Athleta design executive Sarah Carlson. It also moved for the third time into a 13,000-square-foot headquarters in Encinitas.
In addition to the Encinitas store, it has locations in Manhattan Beach and San Francisco, and a flagship is slated to open in Del Mar, Calif., later this month.
Direct-to-consumer continues to represent 60 percent of its sales, but it also has a robust wholesale business with more than 500 specialty accounts in the U.S., Canada and Japan, including Paragon Sports, Equinox, Nordstrom, and REI where it has consistently ranked among the top-performing brands.
Despite the success, Kudla continues to be low-key, saying only that he had “started another business that made money” before launching Vuori. An understatement perhaps since the California native, athlete and one-time model, was a senior auditor with Ernst & Young before founding Vaco, a professional staffing company that was among San Diego’s fastest growing companies during his tenure.
But the two years that he spent modeling in Europe and the U.S. had make their mark and also provided a “peek behind the curtain” of the apparel business. “I was intrigued by watching designers bring the lines to life,” he said.
Everything changed a decade ago when chronic back pain that he’d sustained after years of football and lacrosse, led Kudla to yoga. He soon became a convert. “I fell in love with the practice of yoga,” he said. But he wasn’t a fan of the big players in the active apparel business such as Lululemon, Nike or Adidas, and set out to create an alternative.
“Vuori is an extension of everything I love,” he said. “In Encinitas, there are more yoga studios than Starbucks and I was looking to build a product that resonated in our lives.”
Today, the company’s bestsellers include its Banks shorts, a performance product made from recycled plastic bottles (retail price $68); as well as its Kore shorts with a minimalistic design and breathable boxer-brief lining, as well as cotton Ripstop Climber pants that retail for $89, and a Tradewind Performance T for $48.
“It’s all high quality, but there are no logos or decorations,” Kudla said.
Looking to the future, Kudla said the $45 million check from Norwest was “a big milestone” for Vuori and he will use the money to further invest in his team, enhance its marketing efforts, expand its product offering and add to the brand’s brick-and-mortar presence. In 2020, he expects to add two more locations in the Bay area as well as one in Los Angeles. He’s also exploring locations in Scottsdale, Ariz., Denver and Boulder, Colo., Austin, Tex., Seattle and Portland, Ore., Chicago and New York.
The locations will be chosen by mining the data the brand has accumulated in the past five years to see where most of its customers are located. New York is Vuori’s number-two market and Kudla said a store will open “eventually. We’re just hitting our moment as a brand,” he said.
“The hardest thing to pull off is performance-oriented product that also feels at home in the day-to-day lifestyle needs. But Vuori does it better than anybody else and it sits in the best possible space.”