When Joe Kudla, founder of Encinitas-based sportswear brand Vuori, had the opportunity to sit down with representatives of start-up investor SoftBank, he didn't really want to raise funds. He thinks this is more like an "informal get to know you" meeting.
But the initial gathering led to another gathering, and the initial introduction developed into a business transaction, making Vuori one of the largest investment rounds in San Diego startups in recent memory.
Earlier this month, the company raised $400 million from SoftBank Vision Fund 2. The funding is a huge bet that Vuori can replicate the rich history of Southern California's successful, beach-inspired lifestyle brand launching globally.
The company will use the funds to expand its footprint in the crowded performance sportswear market-opening more than 100 stores in the United States in the next five years, while expanding in Europe and Asia.
"We think now is a good time," said Kudla, a San Diego native and CEO of Vuori. "The market allows us to develop, and we believe this is the right approach."
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According to the company, the transaction valued Vuori at US$4 billion. It currently operates nine of its own stores, mainly in Southern California and Colorado. Its high-end clothing is also available on its website and most REI and Nordstrom stores.
Kudla said the 450-employee company expects to employ more than 1,000 employees by 2024. Since 2017, it has been profitable.
Kudla is a former accountant at Ernst & Young. He co-founded a human resources company. After graduating from university, he worked as a model in Europe for several years, which inspired his interest in the apparel industry.
"I'm the kind of person who always runs a T-shirt business in a garage," he said.
Seven years ago, he launched Vuori. The idea is to provide men with high-quality sportswear that can be worn flexibly outside the gym-similar to Lululemon's female yoga style clothing.
Kudla said: “We hope to create a product that can redefine the look and feel of men’s sportswear, and make it more versatile and wear-resistant.” “So. Whether you are in the gym or cruising in the city on weekends, the product will be You serve."
Although the company initially targeted men, Vuori launched women's clothing in 2018 and now sales are 50/50. Lululemon also produces high-quality sportswear for men, but Kudla believes that Lululemon is still the most famous brand of women's sportswear.
In 2019, Vuori raised US$45 million from Norwest Venture Partners. Kudla said that sales tripled during the pandemic last year and are expected to grow by 140% this year, which helps to prove that it can be profitable on a large scale.
With new funding, Vuori will not only expand its retail stores, but also launch new products and invest in sustainable development. Through cooperation with Climate Neutral and CleanHub, the company aims to offset its carbon and plastic footprint and eliminate 80% of plastic from its transportation and supply chain by 2022.
Nagraj Kashyap, managing partner of SoftBank Investment Advisers, said: "With strong consumer engagement, focus on sustainability and pure growth, we believe that Vuori is a leading brand in the attractive sportswear market." "We It’s great to work with the Joe and Vuori teams as they introduce new products to consumers and expand globally."
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Mike Freeman reports on technology for the San Diego Union Tribune, and his coverage includes Qualcomm, the largest public company in San Diego. Mike joined Union-Tribune in 1999 and is responsible for the golf and extreme sports industries. For many years, Mike has covered commercial real estate, real estate bubbles, banks and defense contractors. He also reported on the Pinnfund Ponzi scheme and several real estate scams. He is one of the few journalists in the country to research and write a special issue on executive compensation. Before joining the United Tribune, Mike was a business editor for a daily newspaper in Bend, Oregon. He graduated from Linfield College in McMinnville, Oregon with a bachelor's degree in communications.
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