American Designer Brand Or Financial Crisis

The financial situation of the American designer brand Proenza Schouler may have problems. The company's investors are seeking to withdraw. The brand has already started a dialogue with several potential investors, and new investors may acquire all the shares of the original shareholders.


Founded in New York in 2002 by designer Jack McCollough and Lazaro Hernandez, the women's brand Proenza Schouler is a high-profile designer brand in the fashion world. In 2004, it won the CFDA/CFDA/Vogue CFDA/ The Vogue Fashion Fund Awards have won five CFDA fashion awards and three times the annual women's designer brand nomination. Proenza Schouler's PS1 handbag was once a popular it bag.


At present, Proenza Schouler's shareholders include founders and designers McCollough and Hernandez, as well as private equity firm Castanea Partners, who bought the small equity in 2015, Andrew Rosen, CEO of Theory, and CEO of Irving Place, a private shareholder company. Officer John Howard.


Although the design of the Proenza Schouler brand has been well received in the fashion circle, it is said that the Newchic Coupon shareholders of Proenza Schouler have been disappointed with the brand, because the development of the company does not match the designer's good reputation in the industry, and it is now showing signs of decline.

In fact, news about Proenza Schouler's investment has been circulating in the fashion industry for a few rounds, but investors have been much more positive about the brand a few years ago. A report in the 2015 New York Times compared Proenza Schouler to the long-time pursuit of investors, because the brand is full of potential, young (only 13 years old), and has an excellent reputation in the fashion field. It is rumored that the luxury goods giant LVMH Group also intends to acquire the brand, but later the brand and Castanea reached a deal.


In the past three years, this darling of the once-investor seems to be in trouble. According to sources, Proenza Schouler’s expenses have lost control and are now in poor financial condition and tight cash flow. The brand has now closed stores on Madison Avenue in New York, and in September 2018 moved the fashion show from Paris back to New York.


Proenza Schouler's recent frustration may be related to the brand's failure to keep up with the era's distribution model, and the brand is still focusing on the traditional wholesale model, and many other brands have shifted their focus to direct store sales or to face consumers. Direct-to-consumer. In addition, Proenza Schouler is neither part of the big luxury group, can't enjoy the good resources brought by the group operation, and can not enjoy the fan dividend like the brand that is ignited by social media. This fashion brand, which still looks a bit traditional, seems to be getting harder and harder to meet investor expectations.


Proenza Schouler is also experimenting with other possibilities beyond fashion. In 2015, it signed a long-term licensing agreement with L'Oreal to co-produce and develop the premium perfume business, and officially launched its first fragrance at the beginning of this year. This fall, the product re-branded and Lancome launched a limited-edition beauty collection.


Although Proenza Schouler began experimenting with the money-making beauty business in recent years, the brand's promotion in the beauty and perfume business is still very slow, and now the brand's development focus is still on the company's fastest growing footwear business.


As of press time, Proenza Schouler has not yet responded to his request for investors.