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Let's talk about Lawrence Stroll who made a fortune in fashion by backing two iconic brands.
His race to success included finding strong partners and backing creative underdogs. His latest bet is about his other passion: luxury sports cars.
His race to success included finding strong partners and backing creative underdogs. His latest bet is about his other passion: luxury sports cars.
1/
Stroll was born in 1959 and grew up in Montreal.
His father was in the textile business with the license for Pierre Cardin Canada.
Lawrence joined the business, adding licenses for Ralph Lauren in Canada and later Europe.
Stroll was born in 1959 and grew up in Montreal.
His father was in the textile business with the license for Pierre Cardin Canada.
Lawrence joined the business, adding licenses for Ralph Lauren in Canada and later Europe.
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While sourcing clothing in Hong Kong he met Silas Chou, the rising scion of a Hong Kong textile family.
Chou was expanding the family business which made sweaters for big brands.
The two would become lifelong friends and partners.
While sourcing clothing in Hong Kong he met Silas Chou, the rising scion of a Hong Kong textile family.
Chou was expanding the family business which made sweaters for big brands.
The two would become lifelong friends and partners.
3/
Chou was thinking ahead:
“I may be the last generation of the traditional manufacturing family in the Far East. The comparative advantage is gone. Hong Kong is too expensive. That's why I looked to brand names. This is a great business for my children an grandchildren.”
Chou was thinking ahead:
“I may be the last generation of the traditional manufacturing family in the Far East. The comparative advantage is gone. Hong Kong is too expensive. That's why I looked to brand names. This is a great business for my children an grandchildren.”
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Stroll and Chou's first deal was Tommy Hilfiger.
Hilfiger's first backer, the Murjani family, was struggling and wanted out.
Hilfiger traveled to Hong Kong to try and get his latest collection delivered on credit. Chou saw potential for a deal and brought Stroll in.
Stroll and Chou's first deal was Tommy Hilfiger.
Hilfiger's first backer, the Murjani family, was struggling and wanted out.
Hilfiger traveled to Hong Kong to try and get his latest collection delivered on credit. Chou saw potential for a deal and brought Stroll in.
5/
Stroll was skeptical: "Look, this has to be big or I don't want to be involved.”
Hilfiger: “Well, how do we make it big, Lawrence?”
Stroll: “We build shops in department stores, we build them in the right locations and put a lot of investment into it and make them happen.”
Stroll was skeptical: "Look, this has to be big or I don't want to be involved.”
Hilfiger: “Well, how do we make it big, Lawrence?”
Stroll: “We build shops in department stores, we build them in the right locations and put a lot of investment into it and make them happen.”
6/
In 1988 Chou and Stroll formed Sportswear Ltd and bought out Murjani.
Chou was the financial strategist, Hilfiger the creative brain, Stroll responsible for marketing and growth.
They pushed aggressively into department stores and expanded internationally with licenses.
In 1988 Chou and Stroll formed Sportswear Ltd and bought out Murjani.
Chou was the financial strategist, Hilfiger the creative brain, Stroll responsible for marketing and growth.
They pushed aggressively into department stores and expanded internationally with licenses.
Hilfiger: "So he went with me to all the major department stores in the world … and walked up to the CEO or chairman and say, “We want that space right off the escalator.”
7/
In the 90's the brand exploded when it was adopted by hip hop and pop artists.
Snoop Dogg famously performed in a Tommy Hilfiger outfit on SNL in '94
https://www.complex.com/style/2016/08/tommy-hilfiger-hiphop-oral-historytsn
In the 90's the brand exploded when it was adopted by hip hop and pop artists.
Snoop Dogg famously performed in a Tommy Hilfiger outfit on SNL in '94
https://www.complex.com/style/2016/08/tommy-hilfiger-hiphop-oral-historytsn
8/
Stroll and Chou sold their stake after the IPO, turning ~$20mm into hundreds of millions.
In 2000 the brand became overextended. After a period of restructuring the company was taken private by Apax for $1.6bn in 2006 and in 2010 sold to PVH for $3bn.
Stroll and Chou sold their stake after the IPO, turning ~$20mm into hundreds of millions.
In 2000 the brand became overextended. After a period of restructuring the company was taken private by Apax for $1.6bn in 2006 and in 2010 sold to PVH for $3bn.
9/
“When a baby is three years old, you can see if it is smart or not smart, healthy or not healthy. We do not wait until adulthood, because then there is no growth. We sell at puberty, so there is still growth in the market. There is no risk.” Silas Chou
“When a baby is three years old, you can see if it is smart or not smart, healthy or not healthy. We do not wait until adulthood, because then there is no growth. We sell at puberty, so there is still growth in the market. There is no risk.” Silas Chou
10/
Their second hit was Michael Kors.
After his first business failed, Kors was designing for LVMH. But he didn't fit in: “If you're a nice kid, no one pays attention to you.”
Hilfiger saw potential and introduced him to Stroll and Chou.
Their second hit was Michael Kors.
After his first business failed, Kors was designing for LVMH. But he didn't fit in: “If you're a nice kid, no one pays attention to you.”
Hilfiger saw potential and introduced him to Stroll and Chou.
11/
“Designers at forty have energy, but their experience means they have had some financial trouble. At twenty or thirty years old, they may still be dreamers. At forty, they are not dreamers anymore. They are still full of energy, but they are more realistic.” Silas Chou
“Designers at forty have energy, but their experience means they have had some financial trouble. At twenty or thirty years old, they may still be dreamers. At forty, they are not dreamers anymore. They are still full of energy, but they are more realistic.” Silas Chou
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"It was time for him to become the next great American designer. We wanted to invest in someone who is American, whose style is aspirational and who is seasoned but not too old. With these criteria, there were surprisingly few names to choose from." Lawrence Stroll
"It was time for him to become the next great American designer. We wanted to invest in someone who is American, whose style is aspirational and who is seasoned but not too old. With these criteria, there were surprisingly few names to choose from." Lawrence Stroll
13/
Stroll and Chou bought Kors at a $100mm valuation. They hired an experienced CEO, introduced lower priced clothing lines, and focused on adding accessories. Again they first made a push into department stores.
Stroll and Chou bought Kors at a $100mm valuation. They hired an experienced CEO, introduced lower priced clothing lines, and focused on adding accessories. Again they first made a push into department stores.
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The financial crisis provided an opportunity to open up stores in malls. The company grew rapidly right through the recession and went public in 2011.
Stroll and Chou exited when growth was still strong. This time they made $3 billion on their $100 million investment.
The financial crisis provided an opportunity to open up stores in malls. The company grew rapidly right through the recession and went public in 2011.
Stroll and Chou exited when growth was still strong. This time they made $3 billion on their $100 million investment.
15/
Stroll collects Ferraris, owns his own race track, Le Circuit Mont Tremblant in Quebec, and bought an F1 team in 2018 (where his son Lance is a driver).
Stroll collects Ferraris, owns his own race track, Le Circuit Mont Tremblant in Quebec, and bought an F1 team in 2018 (where his son Lance is a driver).
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In 2020, 107-year old Aston Martin stared into the abyss. The company had produced too many cars, the dealer lots were full. The balance sheet was heavily leveraged.
Then COVID happened.
In 2020, 107-year old Aston Martin stared into the abyss. The company had produced too many cars, the dealer lots were full. The balance sheet was heavily leveraged.
Then COVID happened.
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This was a deal at the intersection of Stroll's passions: luxury and race cars.
He stepped in with a rescue deal, brought on a new CEO from Mercedes AMG, raised more capital, and tied up Aston Martin with his F1 team.
This was a deal at the intersection of Stroll's passions: luxury and race cars.
He stepped in with a rescue deal, brought on a new CEO from Mercedes AMG, raised more capital, and tied up Aston Martin with his F1 team.
18/
This will be his greatest challenge yet. Like in the F1, he is competing for the championship in a race with little margin for error.
For my detailed breakdown of his journey and ambitions check out my substack: https://neckar.substack.com/p/thinking-big-lawrence-strolls-race
This will be his greatest challenge yet. Like in the F1, he is competing for the championship in a race with little margin for error.
For my detailed breakdown of his journey and ambitions check out my substack: https://neckar.substack.com/p/thinking-big-lawrence-strolls-race
More reading by the Times https://www.thetimes.co.uk/article/lawrence-stroll-the-canadian-petrolhead-leaving-aston-martin-shaken-and-stirred-0pxtqf36x
