"In just three years, a small company has become an empire worth millions of dollars with its own strength." In 2019, some media lamented the rapid growth of the fitness clothing brand Vuori. But the author certainly didn't expect that the multi-million dollar business was just a "small goal" for Vuori.
Recently, Vuori received $400 million from SoftBank Vision Fund investment, with a valuation of $4 billion. This is one of the biggest investments in the footwear and clothing field recently.
Vuori last received financing in the summer of 2019, Norwest Venture Partners issued a $45 million check to Vuori to buy a minority stake in Vuori. Vuori's valuation was only $200 million at that time.
Despite this, growing into a company of this size is beyond Kudra's imagination. Kudra told Women's Clothing Daily: "I never imagined that the company could reach a valuation of $4 billion, which is a milestone for us, and it also shows that SoftBank can identify the leading and bold companies in the market as before."
Kudra, who once worked as an athlete, model and auditor , chose the sport of yoga due to chronic back pain, but found that there was no men's sportswear on the market that meets his needs. In addition, he witnessed the evolution of lululemon, so Vuori was born in 2015.
As far as products are concerned, Vuori's design is not fashionable or avant-garde, but instead spends more energy on making the product more comfortable to wear. But Vuori's products are also casual aesthetics, which are suitable for sports and can meet the needs of daily wear.
At the beginning, Vuori only designed sportswear for men, and most of them were bottoms. Lazy Bear Sports once wrote in a 2018 report that most clothing brands only sell 1 lower package for every 3 tops, while Vuori is the opposite.
Later, Vuori's brand gradually expanded to more categories such as jogging pants, sweatshirts, T-shirts and accessories. As people become more and more yearning for outdoor spaces, Vuori is also considering launching more outdoor clothing and swimsuits.
In 2018, Kudra discovered that many women were buying Vuori's men's clothing, so she simply launched a women's clothing business. Now she has launched basic sportswear styles, jackets, swimsuits and travel series. Today, women's clothing accounts for 50% of Vuori's overall business and is "growing very fast". However, Kudra has no intention of letting women's clothing dominate the future clothing category, and her goal is to make half of both men's and women's clothing.
Vuori, which has achieved profitability since 2017, has received the bonus of the new crown epidemic in 2020. Vuori's sales soared when the global apparel market was hit. In an interview with Business Insider at the end of 2020, Kudra revealed that in 2020, sales of women's sweatpants increased by more than 1,000%, and the men's Ponto performance series also saw similar growth, with annual revenue expected to double.
Using the US$400 million invested by SoftBank, Vuori will continue to expand product supply, enter the international market, significantly increase physical business, further invest in infrastructure and expand employee recruitment.
In terms of entering the international market, Kudra already has a timetable. The promotion methods are also somewhat different for different markets.
From the above schedule, we can find that Vuori prefers the DTC mode when entering new markets. Vuori has had the sweetness. When the epidemic in 2020 just arrived, wholesale customers canceled their orders, but Vuori transferred inventory to e-commerce to avoid losses in a timely manner.
Kudra told Adweek that before the outbreak of the new crown epidemic, Vuori originally planned to come from 50% of sales online, 40% from wholesale, and the rest from retail stores. In the end, 70% of the business comes from e-commerce, wholesale business accounts for 24%, and retail business drops to 6%.
In August last year, Kudra predicted that Vuori's digital business sales in 2020 are expected to grow by 330%.
Social media accounts for about 60% of Vuori's way of reaching consumers. Vuori played online courses on Instagram Live and started a series of interviews during the pandemic, including Nets head coach Steve Nash and singer Jason Mraz. On this basis, Vuori is also trying to expand new channels, such as connected TV and radio.
However, Vuori's emphasis on physical business is increasing, and this is also reflected in the accelerated opening of Vuori's physical store. Kudra emphasized that the DTC model will not affect Vuori's cooperation with Nordstrom, REI and other companies.
From the perspective of Vuori transformation and future planning, its development trajectory is also in line with the current market trend. Just as Nike is opening more direct stores, lululemon reaches users through direct stores and community directly, and the brand emphasizes offline dialogue with consumers to enhance consumer experience.
In addition, lululemon also started making men's yoga suits in 2017, and launched products such as CitySweat, from yoga expansion to running, swimming, comprehensive training and other scenarios. It happened to be the same as Vuori's launch of women's sportswear. Everyone is trying to make the cake bigger. Now that SoftBank's financing is 400 million yuan, Vuori will inevitably continue to focus on category expansion.
Look at SoftBank, the investor of Vuori, has been very enthusiastic about sports and fitness companies this year. The investment projects include:
· In January 2021, domestic sports technology company Keep received a US$360 million Series F financing led by SoftBank Vision Fund;
· In April 2021, home fitness startup Tempo received US$100 million from SoftBank;
· In July 2021, Japanese sports shoes second-hand trading company SODA received a US$56.7 million Series C financing led by SoftBank;
· In August 2021, wearable technology company Whoop received a US$200 million Series F financing led by SoftBank Vision Fund;
· In August 2021, sports e-commerce platform Fanatics received US$325 million in financing, with SoftBank participating in the investment;
· In September 2021, Fantsey football game platform Sorare announced that it had completed a US$680 million Series B financing led by SoftBank;
· In October 2021, American functional sportswear brand Vuori announced that it had received US$400 million in investment from SoftBank Vision Fund.
Among them, Keep, Tempo and Vuori are all located in the big fitness track, and Whoop is also related to fitness monitoring. In 2019, SoftBank also invested $300 million in Brazilian fitness startup Gympass.
Early this year, an investor mentioned to " Daily Economic News " that in the current investment portfolio, the number of fitness technology brands is increasing. In the next 10 years, food technology and health technology will become areas of focus for capital.
Lazy Bear Sports combined with public information and information statistics from its own source, from January 1 to December 31, 2020, there were 53 investment and financing incidents by domestic sports-related companies, of which 40 were disclosed, with a total of approximately RMB 3.0344 billion. According to incomplete statistics, there were 70 financing incidents of foreign sports-related startups, of which 66 were disclosed in total investment and financing amounts, with a total of 21.4553 billion yuan.
Compared with the same period in 2019, the domestic investment and financing events and amounts in 2020 decreased by 54.02% and 23.54% respectively, but foreign countries did not decline but rose. During the same period in 2019, there were only 56 financing events of foreign sports-related startups, of which 44 were disclosed, with a total of 14.924 billion yuan. In the future, SoftBank should continue to pay attention to international sports and fitness brands.
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