(ZH) Who Made The Most US Unicorn Acquisitions Since 1997?

Who Made The Most US Unicorn Acquisitions Since 1997?
The elusive unicorn is no longer a myth in the U.S. startup world, with over a thousand private startups reaching a $1 billion valuation in the last 25 years.

While some of these startups eventually go public and go on to become household names, it’s also common for founders to exit through mergers and acquisitions (M&A), by selling their startup to another organization. In fact, over half of the 1,110 unicorns in the U.S. have made some sort of an exit—either through an IPO, a direct listing, a SPAC or an acquisition—since 1997.

Ilya Strebulaev, professor of finance and private equity at the Stanford Graduate School of Business, brings us this visualization featuring the companies that acquired the most unicorns over the last 25 years.

Strebulaev’s database lists 137 private and public companies along with PE firms who’ve acquired at least one unicorn since 1997, totaling 177 acquisitions.

The Biggest U.S. Unicorn Acquirers
In total, 27 companies have acquired two or more unicorns, accounting for nearly 38% of all acquisitions. 110 companies have acquired just one unicorn.
Company/ PE Group Acquired
Meta 5
Cisco 4
Alphabet 4
Amazon 3
Nortel Networks 3
Bristol-Myers Squibb 3
Johnson & Johnson 3
Merck & Co. 3
AT&T 3
Recruit Holdings 2
IBM 2
Microsoft 2
Thoma Bravo 2
Headspace Health 2
Allergan 2
Qualcomm 2
Rakuten 2
Adobe Systems 2
Eli Lilly 2
Vista Equity 2
Dell 2
Uber 2
Oracle 2
Nestle 2
Lucent Technologies 2
Broadcom Corporation 2
GlaxoSmithKline 2
BlackBerry 2
Searchlight Capital Partners 1
Singtel 1
Vmware 1
Internet Capital Group 1
Hellman & Friedman 1
AppLovin 1
Ciena Corporation 1
Redback Networks 1
Aether Systems 1
Fresenius Medical Care 1
Electronic Arts 1
Genentech 1
Inktomi 1
VistaJet 1
Ariba 1
Keurig Dr Pepper 1
Fullscreen 1
Sycamore Networks 1
Novartis 1
TP ICAP 1
eBay 1
DoveBid 1
McKesson 1
IG Group 1
Empower Retirement 1
Dentsply Sirona 1
Novo Nordisk 1
Centocor 1
Bausch Health 1
Dainippon Sumitomo Pharma 1
Medtronic 1
Mubadala Investment Company 1
Cint Group 1
Qualtrics 1
Rocket Companies 1
Saudi Arabia's PIF 1
Prosus 1
Cigna 1
One Medical 1
Exact Sciences 1
Teladoc Health 1
Ericsson 1
SoFi 1
PayPal Holdings 1
Bayer 1
Monsanto 1
AMD 1
Aurora 1
Marvell International 1
Bill.com 1
ADC 1
Dealertrack 1
Cox Enterprises 1
L'Oreal 1
AstraZeneca 1
Workday 1
Iron Mountain 1
Splunk 1
Stonepeak 1
American Express 1
OfferUp 1
VMware 1
Ontario Teachers' Pension Plan 1
Groupon 1
Allstate Corporation 1
LinkedIn 1
SAP 1
Mindbody 1
Mallinckrodt 1
Walmart 1
GMT Communications 1
Brightstar Capital 1
Enterprise Holdings 1
Healtheon Corporation 1
Apple 1
PetSmart 1
Epiphany 1
Rice Energy 1
Unilever 1
SBA Communications 1
Bridgepoint Advisers 1
Aurea 1
Vector Capital 1
FireEye 1
Littlejohn & Co 1
Alexion 1
SoftBank Investment Advisers 1
Francisco Partners 1
Betfair Group 1
Shift Technologies 1
Hudson's Bay 1
Illumina 1
Hewlett Packard Enterprise 1
AbbVie 1
Salesforce 1
Hanergy 1
Teleflex 1
Twilio 1
Okta 1
Celgene 1
NantCell 1
VMware & EMC Corp 1
Intuit 1
Yahoo! 1
Netmarble Games 1
F5 Networks 1
Roche 1
Centerbridge Partners 1
Total 177
Meta, the parent company of Facebook, leads the pack with the most unicorn acquisitions in the U.S., purchasing five unicorns since its founding in 2008, including: Kustomer, WhatsApp, Instagram, CTRL-Labs, and Oculus VR.

Notably, WhatsApp—which closed at a purchase price of $19 billion—was Meta’s most expensive acquisition yet, over nine times their next most expensive purchase, Oculus VR.
Meanwhile, Alphabet (now the parent company of Google) and Cisco are tied in second place with four U.S. unicorn acquisitions each.
  • Alphabet: YouTube, Actifio, Nest Labs, Looker Data Sciences
  • Cisco: Cerent, Duo Security, AppDynamics, Jasper
Unlike its Big Tech peers, Apple has only made the one U.S. unicorn acquisition: navigation company HopStop that helped bring public transit features to Apple Maps.
Meanwhile, 56% of acquirers received venture capital funding of their own when they were private companies. This includes pack leaders like Meta, Cisco, Alphabet, and Amazon.

Are Unicorn Acquisitions Slowing Down?
Unicorn acquisitions are driven by two factors: the rate at which new unicorns are minted, and the climate for M&A transactions more broadly.

To begin with, the minting of new unicorns is largely influenced by the venture funding environment. Funding opportunities increase when interest rates go down, which makes riskier, venture-scale ideas more enticing. During the last decade of persistently low interest rates up until 2022, unicorns flourished more than ever.

Meanwhile, as tech companies like Apple, Microsoft, Alphabet, and Meta began seeing outsized profits in the 2010s, venture investors and their LPs looked to get in on the ground floor of tech startups that could emulate their success, often paying premium valuations for the chance. Simultaneously, big tech looked to acquire unicorns themselves, both to augment their business lines and to squash potential competitors.

However, the era of “easy money” may have come to an end, and privately-held startups have seen valuations drop in recent years. This means that for the next little while—at least until monetary policy stops tightening—unicorns could become a rarer sight.

Unicorn acquisitions may also see a similar fate. Persistent inflation and the government anti-trust push are just some of the other factors that have led to VC-backed startup acquisitions falling to their lowest quarterly levels in a decade. The more expensive the valuation, the harder to find a buyer, which means that some unicorns may even lose their $1 billion tag even when they do get acquired.

(ZH) Antibiotic-Resistant Bugs Will Kill As Many As Cancer By 2050; UN Report

Antibiotic-Resistant Bugs Will Kill As Many As Cancer By 2050; UN Report

Deaths from drug-resistant infections are set to skyrocket by 2050, according to the UN 2023 report ‘Bracing for Superbugs: Strengthening environmental action in the One Health response to antimicrobial resistance.’
Unless drastic action is taken to tackle the problem, it could also lead to a GDP shortfall of $3.4 trillion annually in the next decade and push 24 more people into extreme poverty.
As Statista's Anna Fleck reports, according to recent estimates, in 2019, 1.27 million deaths were directly attributed to drug-resistant infections globally, while 4.95 million deaths were linked with bacterial AMR. That’s now well above the death counts of major killers HIV/AIDS and malaria, which were estimated to have claimed the lives of 860,000 and 640,000, respectively, that year. As the following chart shows, antibiotic-resistant infections could kill as many as 10 million people in just three decades - on par with the 2020 death toll from cancer.
You will find more infographics at Statista
Although the risks of AMR will impact people worldwide, Low-Income Countries (LICs) and Lower-Middle-Income Countries (LMICs) are expected to see the highest death tolls. By region, Asia is predicted to see the highest number of AMR-related deaths per 10,000 population in 2050 (4,730,000), followed by Africa (4,150,000), Latin America (392,000), Europe (390,000), North America (317,000) and Oceania (22,000).
According to the report, AMR also exacerbates inequalities within societies and so groups including women, children, migrants, refugees, people employed in sectors such as agriculture or healthcare, as well as those living in poverty will be particularly vulnerable to drug-resistant infections.

Business Of Fashion : At Unilever Prestige, An Acquisition Model Focused on the

At Unilever Prestige, An Acquisition Model Focused on the Future of Beauty
Unilever Prestige’s brand portfolio, including Dermalogica, Ren and Tatcha, generated €1.2 billion in revenue in 2022, with ambitions to grow through acquisitions, innovation and digital commerce. BoF meets CEO Vasiliki Petrou to learn her acquisition criteria and how quick decisions, R&D capabilities, a founder mindset and brand-centric strategy are driving the portfolio’s growth.

Unilever Prestige — Unilever’s arm for premium beauty brands, which includes brands such as Dermalogica, Ren and Tatcha — contributed €1.2 billion to the beauty multinational’s reported revenues in 2022, in excess of $63 billion.

Having launched the Prestige category in 2014, CEO Vasiliki Petrou describes the brand portfolio as a collection of “gems,” with every brand maintaining a distinct identity and a founder’s mindset. However, they share core identifying factors: a clear, meaningful purpose; an engaged brand leader; and a willingness to utilise tech and innovation to drive growth.

Growing revenues by $500 million in 2021, the category continues to perform despite challenging market conditions due to its “disciplined and selective approach to capital allocation.” The US Unilever Prestige beauty, skincare and colour cosmetics portfolio grew at twice the market rate, and digital commerce accounts for approximately 50 percent of all Prestige Beauty portfolio sales. China is now the category’s third biggest market.

The company plans to scale Unilever Prestige to a €3 billion business by acquiring best-in-category brands and investing in innovation. Unilever Prestige brands can leverage Unilever’s mighty research and development (R&D) capabilities. For example, Hourglass’ Red 0 Lipstick was created with the aim to remove carmine, an ingredient used across the industry to achieve red pigmentation that is derived from crushed female beetles. This innovation took three years, 17 formulations and 170 colour experimentations.

Now, BoF sits down with CEO Vasiliki Petrou to learn how purpose and innovation inform its decision making on acquisitions and act as the foundation of their strategy to scale the business to €3 billion.

What criteria does Unilever Prestige use when analysing potential acquisitions?

Unilever believes in the power of purpose. We believe in the positive social impact and we know that that this translates into strong advocacy within our communities. The Prestige brands all have their own authentic approach to social impact: Dermalogica support female entrepreneurs; Tatcha champion the right for girls’ access to education; REN have an embedded planet initiative through all that they do. I assess how well a brand fits with the purpose-driven mission of Unilever Prestige, and then we look at whether a brand has high growth potential with longevity — I’m always thinking 20, 30 years into the future.

My responsibility is to determine those brands that have long-lasting glide versus the quick viral wonders that could come and go. I’m looking for brands that operate in a unique benefit space, and also that behave or do things a little bit differently because I believe in whitespace thinking. If brands were doing the same things again and again, it wouldn’t be interesting for us.

Why is the leadership of a brand so important in your assessment?

In my experience, there is usually a team of two co-pilots successfully leading a company — the visionary founder and the business genius. Founders will always stay to continue to shape the vision and innovation and we then look to hire CEOs that take on the day-to-day of the global management of the P&L and the end-to-end management of the business.

When hiring CEOs, I’m looking for people that have a founder’s mindset, which means an entrepreneurial spirit, the hunger of making a difference, a passion to leave a legacy, and high integrity, high morals. We are managing big businesses and we always want to do the right thing, whether it is for the world, for our employees or for consumers’ rights — at all times.

Obviously, expertise is important — people who have done it before, that are demonstrably highly skilled. But I think the people who have made a huge difference are the people who have the thirst and passion to win, to succeed, to make a difference. They don’t take no for an answer, which is very much a founder’s mindset.

How do you approach the group’s retail strategy?

We are proud to say that more than 50 percent of the business is now through e-commerce. I have created a centre of excellence across the globe so that leaders from each brand get to share their data day-to-day. It is no overstatement to say the shared learnings are extremely powerful. By sharing intelligence across them, you achieve this exponential learning curve where people don’t learn from scratch every time, but they learn exponentially from it.

By sharing intelligence across brands, you achieve this exponential learning curve where people don’t learn from scratch every time, but they learn exponentially from it.

However, in terms of retail channels, we manage a decentralised business for a reason. People are looking for authentic brands that have depth and have a soul. A consumer will often feel a connection with that soul of the brand. So I am not a big proponent of flattening brands to something that looks and feels cookie-cutter. I want people to experience differentiated brands that deliver distinct benefits — different people have different needs after all.

When we represent a sizeable chunk of business with our retail customers, whether it is Sephora or Ulta, you have a joint partnership, a business relationship, where you can talk about where we are going as a group — that is our North Star.

How are you using technology to innovate the connection between brands and consumers?

We have maintained the freedom of individual brands to experiment and play within their differentiating genres and lead the way in the areas they excel. So Dermalogica are continually using advanced technology initiatives to strengthen their global education programmes for their professional skincare therapists and medi-spa services.

Tatcha uses technology in a different way as an enabler to connect with their consumers through virtual immersive experiences — they have just done this with a forest bathing immersion that brought to life my dream of how to take our global consumers to Japan and bring our heritage to life. How to make people experience, digitally at least, a sense of forest bathing — both the inspiration and the benefits.

This year, Paula’s Choice also launched a Beautypedia ingredient checker. Paula wrote a famous beauty ingredient-focused book — Don’t Go To The Counter Without Me — that became something of an industry and consumer bible. Now you can scan any ingredients list on any product with your phone and it will give you an analysis of the quality of ingredients measured against specific, transparent principles. That is another example of a brand that is anchored to their DNA and make it accessible to consumers around the world.

How does Unilever Prestige help the brands it acquires leverage Unilever’s R&D capabilities?

Whether it is epigenetics, or expertise on vitamin C, retinol, skin pigmentation, melanin-rich skin, Unilever has outstanding R&D capabilities. All businesses have the opportunity to tap into this rich resource which when combined with our own brand research, and scientists can work in a way that one plus one can sometimes equal ten — and that’s exciting.

One powerful example — Unilever R&D worked for three years in the search for a vegan alternative to [the red pigment] carmine. To achieve a true deep red lip colour in colour cosmetics, traditionally the industry used crushed female beetles. However, Hourglass is a cruelty-free brand and we were obsessed with finding a vegan alternative to carmine.

After three years of research and testing, I believe we are the first premium brand that has delivered an alternative to carmine, which is something we are very proud of. This is the beauty of tapping into the best of the best that R&D has.

What do you believe will define success for beauty brands in the near to mid-term?

If we don’t serve the consumer, what do we do? What makes me get out of bed is to make an impact every day. The emotional letters of gratitude we receive due to the transformation our products can achieve are extremely inspiring. For example, we get a lot of letters from women dealing with chemotherapy that are using scalp and hair care products. This is what gives me the fuel for continuing to make a difference in people’s lives. This is much bigger than simply skin or hair care.

What do you believe will drive the growth of the group to $3 billion in revenue?

To win, we have to be fast. So quick decision-making from me, but also from the CEOs, is a critical ingredient and I think key to what we have done well so far. We are often the first to market with a lot of breakthrough innovation — both in product, technology and experiences. We have been able to quickly turnaround superior diagnostics, personalised advocacy and immersive experiences and our consumer wants that.

Positive social impact will continue to be an important part of our business model because, even now, it is still rare to see truly authentic purpose-driven brands.

Positive social impact will continue to be an important part of our business model and that has helped us to stand out because even now, it is still rare to see truly authentic purpose-driven brands. Typically, some brands like ticking boxes. But for us, it’s part of who we are, and that’s difficult to do. You have to believe it and then you have to make it part of the DNA of the brands, the business model, everything. Our business model is based on a brand-centric approach versus more of a synergistic commercial approach because I don’t think that’s a good long-term strategy.

The priorities are always there, but we have only just started from my perspective. In the US, in 2022, in the skincare premium market, we grew double the market growth rate. We are substantially present in the UK market and growing. We have launched a successful business in China — there is a big business to build there. So, I believe we have billions of lives to impact and I can’t wait for more people to experience the brands and their values. The impact is magical and I want everybody to experience that magic.

FT : Wim Dejonghe: the Belgian rainmaker sealing Allen & Overy’s deal with Shear

Wim Dejonghe: the Belgian rainmaker sealing Allen & Overy’s deal with Shearman
The magic circle law firm’s senior partner has long held ambitions for a transatlantic merger

When troubled New York law firm Shearman & Sterling’s merger talks with its transatlantic rival, Hogan Lovells, collapsed in March, Shearman’s Adam Hakki knew who to call.

Days into his role as senior partner last month, Hakki picked up the phone to ring Wim Dejonghe, the long-serving leader of Allen & Overy, one of London’s elite magic circle law firms. In a matter of weeks, the two were cloistered in a Manhattan office hashing out a $3.4bn merger, which — if voted through — will be one of the biggest the industry has ever seen. 

For Belgian-born Dejonghe — A&O’s first foreign senior partner and before that, managing partner — a tie-up with a Wall Street firm will be the fruition of a two-decade-long project to crack the most lucrative legal market in the world, leaving its British rivals in the dust. For Shearman, it offers a route out of a torrid period of partner exits and difficult restructuring.

“I’ve known Shearman for a long time. [Hakki] got into the role [and] he knew we were interested,” Dejonghe, 62, told the Financial Times. “The initial conversation was between me and him. After a number of meetings between the two of us, we thought: ‘this might work, actually’.”

Shearman, a storied 150-year-old firm that once advised the cream of corporate America, is the far smaller entity, with $907mn in revenues last year and about half of A&O’s more than 40 offices. But it has long been on Dejonghe’s dance card as a potential suitor because of crossovers in banking and finance.

Both firms had also learned lessons from previous failed mergers: in A&O’s case, collapsed talks with California-headquartered O’Melveny & Myers, which ground to a halt in 2019 after 18 months of negotiation.

“We knew [if] this leaks before we go to our partners, we’re dead,” said Dejonghe. “So we agreed the only way we could deliver something to [partners] was to sit together in a room for weeks and hammer out all the details.”

Shearman declined to comment.

With a small core team — including advisers from heavyweight Wall Street law firms Simpson Thacher & Bartlett, and Davis Polk & Wardwell — Hakki and Dejonghe decamped to investment bank Lazard’s offices in Manhattan to pull together what would land on Sunday as a slick announcement, complete with website, client FAQs and video. 

Dejonghe’s predecessor, David Morley, credits him for the speed of the Shearman talks, which were executed within weeks. “Very few people could have done this, but Wim has had this clear strategic vision for a long time.” 

Morley, who led the firm alongside then-managing partner Dejonghe for eight years to 2016 says: “Wim didn’t wake up yesterday and say: ‘it’d be great to do a merger’…. The firm has been thinking about and debating it for at least two decades, and looking at options . . . So they were ready to move really quickly when this came up.”

Morley and Dejonghe, viewed as a modernising force at A&O, spent years pounding the pavements in New York and on the US west coast in the wake of the financial crisis, dining with law firm leaders in powerbroker hotspot Estiatorio Milos in Manhattan.

“Some people would see us,” says Morley. “Others were frightened of even being seen in a restaurant with us in case their partners saw us or it got into the press . . . We weren’t asking people: ‘do you want a merger?’ — just building relationships and gaining insight.” He said this meant Dejonghe had built up a “pretty good Rolodex of American firms”.

A&O has long had offices in the US. But growing there has not been plain sailing. Like its international rivals, A&O has struggled to break into a market dominated by a pack of highly profitable domestic firms with greater firepower to pay star partners. Wall Street’s top firms tend to be tightly focused, with only a handful of international offices and a pipeline of lucrative private equity and finance work.

By contrast, A&O and its magic circle peers in the UK have sprawling global networks, offering clients a far wider variety of work. That has made them one-stop shops for many corporations, but less profitable than their US peers. Partners at Wall Street firms such as Simpson Thacher and Davis Polk took home more than $5mn on average last year, for example, while M&A powerhouse Wachtell Lipton Rosen & Katz partners pocketed more than $7mn. In contrast, A&O’s partners took home £1.9mn ($2.3mn) on average last year.


Tony Williams, a consultant who was managing partner at Clifford Chance when it merged with American firm Rogers & Wells in 2000, said: “The magic circle have been challenged in the last decade by the strength of the US economy . . . And Brexit didn’t help: sterling is now at $1.23.”

One former high-ranking A&O partner said: “Every magic circle firm has been looking to come into the US market for the last 30 years, and a merger has always been the most logical way but it’s extremely difficult to do. The top American firms have always been much more profitable, which for them is a proxy for excellence.”

He added, “Shearman has had some difficulties over the past few years, and suddenly they were available and there’s an opportunity for a match.”

Vast differences in partner pay made it difficult for UK firms to compete in the US, a problem compounded by the stronger dollar. As a result, under Dejonghe, A&O has gradually chipped away at its so-called lockstep pay structure, where partners are paid according to time served, to pay star performers more.

Dejonghe, who another former partner described as “charismatic and entrepreneurial”, is no stranger to overseas mergers, where marrying two different cultures is vital to success. The corporate lawyer, who has five sons, joined A&O when it tied up with part of Loeff Claeys Verbeke — a Brussels-based firm Dejonghe led as managing partner.

He said the Shearman merger is a “merger of equals” in the same way as that deal. “You can’t say to your future colleagues, we’re acquiring you,” he said. “That’s not the mindset . . . It doesn’t work like that.” 

Becoming managing partner at A&O meant leaving Belgium’s cobblestoned streets and its many cycling races. Dejonghe, who cycles to A&O’s Spitalfields office each day, is a veteran of amateur events including the Etape du Tour and the Tour of Flanders.

“I’ve sat in his slipstream going up and down mountains for many years,” said Morley. “We used to tease him that he was good on the flat . . . He used to retort that in Belgium you’re always cycling against the wind. We were always joking with each other; it was kind of a metaphor for the way we worked together.”

“Hills are not my favourite to be honest,” Dejonghe conceded. “Give me the Tour of Flanders anytime.” 

The Shearman deal ahead of him is likely to be a challenge of a very different kind, and potentially the pinnacle of his 15 years at the top. But Dejonghe is sanguine: “I’ve always had a forward-thinking mindset. I’m probably a bit more optimistic than some lawyers.”

FT : Why EU cuts to red tape could hamper environmental ambitions

Why EU cuts to red tape could hamper environmental ambitions

Green tape
Some EU officials worry that a push to cut red tape could let companies off the hook regarding their efforts to reach the Paris climate goals.

New draft rules seen by the Financial Times would make reporting on climate impacts voluntary rather than mandatory for EU companies, writes Alice Hancock.

Context: this year, an update of the bloc’s corporate reporting standards came into force, increasing the number of companies covered by the rules. It sets out that businesses have to report to a set of standards, which will be laid out in further legislation this year.

According to the draft of that legislation, companies won’t have to disclose efforts to come in line with the Paris climate agreement unless the company deems them “material” to its activities.

A specialist advisory group, EFRAG, had advised making reporting climate impacts mandatory, while others, such as employment conditions, could be submitted according to an assessment of their importance done by the company itself.

But the European Commission seems to have disregarded that advice and wants to make all areas, including climate, subject to a “materiality assessment”.

The change has prompted disquiet among more environmentally-minded officials. They argue that it will be more difficult to track the effect of businesses’ activities on the climate. Finance institutions would also have a harder time keeping tabs on businesses they invest in for their own financial reporting.

It also means that companies can set their own terms when it comes to decarbonisation, one EU official said, as seen at the ExxonMobil annual meeting last week.

The move is part of Brussels’ wider effort to cut red tape, after commission president Ursula von der Leyen promised to reduce reporting requirements for businesses by a quarter.

A document circulated this week by Denmark and Estonia showed that there was support among member states for the anti-bureaucracy push.

But in an ironic twist, the changes mean the work for companies might not actually decrease. An executive at a major multinational firm said that while there might be less actual reporting, “it will still take the same amount of work for us because we need to do the assessment for all”.

The commission declined to comment on the change. It said that the standards “will be published for public consultation as soon as possible”.

WWD : Printemps Teases NY Flagship With New Deauville Concept Store

Printemps Teases NY Flagship With New Deauville Concept Store
The French retailer has scrapped brand counters in favor of a cross-merchandising approach.


DEAUVILLE, France — Department store chain Printemps has transformed its smallest store in France into a colorful concept store aimed at wealthy holiday-makers, in a preview of the new format it will roll out on a larger scale at its New York flagship, set to open next year.

The 12,900-square-foot store in the seaside town of Deauville is set to reopen on Friday after a five-month renovation that involved knocking down walls and opening windows to give the neo-Norman style building, originally constructed in 1912, the feel of a lush private home.

“It’s a store that will become a memorable and essential destination in Deauville,” said Printemps chief executive officer Jean-Marc Bellaiche. “It’s our first store of this kind. It’s really a unique concept.”

Printemps has scrapped brand counters in favor of a cross-merchandising approach, eliminating any labels that are available elsewhere in town and replacing them with a selection of 300 brands, of which 85 percent are exclusive to the store and 85 percent are new.

It has a sales staff of 40, including six personal shoppers, all of whom are directly employed by the retailer and trained to sell across categories including womenswear, menswear, watches and jewelry, shoes, beauty, gifts and homewares.

Bellaiche touted it as the latest example of Printemps’ strategy of rolling out unique concepts, such as the temporary rooftop café it opened recently in partnership with jeweler Messika at its Boulevard Haussmann flagship in Paris.

“There is always a more intimate side, a more human side to what we do compared with our competitors, who are sometimes too big or too diverse,” he said.

“This store is also taking a risk,” Bellaiche added. “Deauville will give you a foretaste of what New York will be like. New York will represent an even bigger investment, particularly in terms of architecture, but in terms of offer, in terms of rationale, it will also be a very large concept store rather than a department store.”
The atrium of the Printemps store in Deauville.
ROMAIN RICARD/COURTESY OF PRINTEMPS

Spread over two floors, rooms are decked out in bright hues inspired by local landscapes, with mosaic floors set off with carpets in oversized motifs drawn from the Printemps archives.

The curved outline of the clothing racks is inspired by traditional local furniture, and shelves are dotted with thrift store finds, including a battered brown hat box and a yellow sewing machine.

New features include an atrium with 33-foot-high suspended sculpture consisting of 1,500 brass leaves, 80 ceramic magnolia flowers and LED lights.

Sophie Bocquet, chief network officer of Printemps and its urban apparel chain Citadium, said the Deauville store caters to an affluent crowd made up of 43 percent tourists, 22 percent people with second homes in the area, and 35 percent local residents.

Its average basket of 250 euros was already the highest of its regional network in France, and Bocquet expects the renovation to boost annual sales by at least 25 percent.

“This store is a real game-changer. It’s something that’s never been done, either at Printemps or elsewhere. We practically started from a blank page, as if we were opening a store and not reopening it,” she said.

With products ranging from hostess gifts such as 95-euro Guerlain candles, to a giant ceramic urn that retails for 1,050 euros, the store is an impulse shopper’s delight. “Deauville is synonymous with pleasure, so when you come to Deauville, you really want to treat yourself or someone close to you,” Bocquet said.
The Printemps store in Deauville.
ROMAIN RICARD/COURTESY OF PRINTEMPS

When the location originally bowed in 1912, it marked the first time any French department store had opened a branch outside Paris, noted Stéphane Roth, chief marketing and communication officer at Printemps.

It was built at the same time as the Normandy hotel across the street to cater to a growing leisure class, drawn by attractions including a casino and a racetrack.

Printemps renovated the facade of the listed building between 2017 and 2019, and has replicated its timber structure in the décor of the watches and jewelry department on the first floor, which is now flooded with natural light. The floor is also home to shoes and beauty, including a treatment room offering FaceKult facials.

On the ground floor, clothing and accessories from labels including Burberry, Céline, Chloé, Courrèges, Jacquemus, Khaite, Loewe, Miu Miu, Prada and Valentino sits alongside items like Cire Trudon candles, Baccarat crystal objects and a porcelain edition of Jeff Koons’ Ballon Dog (Blue) sculpture by Bernardaud that retails for a cool 50,400 euros.

There is also plenty of casual fashion on offer, from Carhartt, Diesel and Levi’s, to Erès and Atalaye swimwear, embroidered beach dresses from Benaras by Citrus, and summer-ready footwear from K. Jacques, Ancient Greek Sandals and Alohas, among others.

Among the selection of vintage clothing and accessories in the Second Printemps room is a hard-to-find black Hermès Kelly bag, while the retailer’s own Saison 1865 label offers accessibly priced contemporary styles with a sustainable bent. “It’s a selection worthy of a world capital, both in terms of quality and creativity,” Roth remarked.

Already France’s second most popular destination for conferences, Deauville should receive a visitor boost next year when the region marks the 80th anniversary of the D-Day landings. And next September, Printemps will partner for the first time with the Deauville American Film Festival.

“We are betting on the fact that Deauville will continue to see strong international growth. It already has a very high visibility,” said Bellaiche.

He said Printemps is considering opening similar stores in other French cities, although the offer might be tweaked in line with the location’s potential. “We believe that a smaller format brings us closer to the customer,” he said.

Group comparable sales at Printemps were up 25 percent year-on-year in the fiscal year ended in March 2023, according to Bellaiche, and remain down 2 percent versus the year before the outbreak of the coronavirus pandemic.
Printemps has 16 department stores, including one overseas branch in Doha, Qatar; nine Citadium stores, and four e-commerce sites: printemps.com, citadium.com, fashion e-commerce site Place des Tendances and online homewares retailer Made in Design.
The Printemps store in Deauville.
ROMAIN RICARD/COURTESY OF PRINTEMPS

WWD : Chanel to Ramp Up Investments to Bolster Brand Equity

Chanel to Ramp Up Investments to Bolster Brand Equity
The French brand plans to double capital expenditures this year after 2022 revenues vaulted 17 percent.
PARIS — Who knew the term “big spender” has two Cs in it?

Emboldened by a strong performance in 2022, Chanel — with the famed double C logo — plans to double capital expenditures this year to $1.3 billion, keep investing in communications and events, and add more than 5,000 employees as it seeks to further fan desirability and pursue the “ultimate luxury experience” for its diverse, worldwide clientele.

“Our philosophy is always to stay focused on building our brand equity in each of the markets we operate in,” Leena Nair, Chanel’s global chief executive officer, said in an interview Thursday after the company reported revenues gained 17 percent last year to $17.22 billion, while operating profits rose 5.8 percent to $5.78 billion. “We genuinely keep a long-term perspective in the investments we make.

“We want to ensure that our 100-year-old iconic house continues to thrive and stay a beacon of inspiration for the next 100 years. And we want to do that by staying focused on the transformative power of creation and innovation,” she added, highlighting the appointment of heartthrob actor Timothée Chalamet as the new ambassador of its Bleu de Chanel fragrance as one example.

“We’re continually reinventing our heritage, and reinterpreting our codes to stay future-proofed and to stay ahead of the curve,” she explained.

Chanel’s investments in “brand-support activities” shot up 14.3 percent last year to $2.05 billion, underscoring how luxury’s biggest players are gaining mind share and gobbling up market share via hefty advertising, splashy global events and client-centric activities galore.

In addition to its lavish ready-to-wear and haute couture displays in Paris, Chanel unveiled its cruise 2023 collection last year in Monte-Carlo, and repeated that display in Miami later in the year. It also made history as the first European luxury brand to stage a fashion show in sub-Saharan Africa, unveiling its Métiers d’Art collection in the Senegalese capital of Dakar, following it up with exhibitions there and in Paris.

According to Philippe Blondiaux, Chanel’s group chief financial officer, the impact of its varied activities is plain.

“If you look at the numbers, I’m sure you will agree with me that the return on investment, what we’ve done over the last many years, has been very positive,” he said.

For full-year 2022, the French fashion house trumpeted double-digit growth across all product lines and in all regions, noting its retail teams “nurtured local clienteles” during pandemic restrictions, alluding to lockdowns in China that dented luxury growth last year.

Revenues in Asia Pacific gained 14.3 percent to $8.65 billion on a comparable basis, stripping out the impact of currency fluctuations and changes in company structure. Revenues improved 29.6 percent in Europe to $4.72 billion and 9.5 percent in the Americas to $3.86 billion.

Blondiaux told WWD that 2022’s momentum has carried over into 2023 and it’s currently tracking double-digit gains in mainland China.

He also noted “we are increasing very significantly our business with Chinese consumers outside of China,”

For example, in France last year, the brand’s business with Chinese consumers was down 90 percent versus the pre-pandemic year 2019. By contract, spending by Chinese consumers in France last month, April, was down by only 14 percent. “This shows the speed at which the return of international travel of Chinese consumers is happening,” Blondiaux marveled.

The executive acknowledged that business has “softened” in the U.S. since November, and it continues to do so. “We are still growing single digits in the U.S.,” he said.

Stressing that Chanel “continues to believe strongly in the U.S.,” he pointed to its massive new Beverly Hills boutique and sponsorship of the Karl Lagerfeld retrospective at the Costume Institute at the Metropolitan Museum of Art in New York. Among other key projects in 2023 is a flagship watches and jewelry boutique on Fifth Avenue in Manhattan.

Capital expenditures last year totaled $668 million, representing 3.9 percent of sales, with the lion’s share of the money poured into Chanel’s global retail network. Key openings in 2022 included a revamped and enlarged watches and fine jewelry boutique at 18 Place Vendôme in Paris, and a new Ginza Namiki flagship in Tokyo.

Expanding Chanel’s network of stand-alone fragrance and beauty boutiques was another priority, with 39 such locations added in 2022, Blondiaux noted.

“We believe in an environment where the client has a chance to discover across all of Chanel’s fragrance, beauty and skin care categories,” Nair said, noting these showcases allow for storytelling and “let the consumer understand what we’re doing with our products.”

Chanel ended the year with 565 boutiques worldwide, of which 262 were dedicated to fashion.

Nair also pointed to significant investments in digital initiatives and IT systems to support the customer journey, business operations and e-commerce capabilities.

“The investments are about ensuring the experience we create for our clients is the embodiment of ultimate luxury,” she said, noting that Chanel has invested some $200 million in about 33 start-ups in the last few years, many of them focused on adding “immersive capabilities” to the in-store experience, such as Mira and Perfect Corp. “We continue to make the investments necessary to future-proof us. Technology should be a big focus area for everyone, including us.”

To wit: While in Los Angeles earlier this month for Chanel’s cruise fashion show, Nair and her leadership team spent time in Silicon Valley “to see what’s coming — metaverse, generative AI, augmented reality, interactive gaming communities. It’s important that we stay nourished.”

She cited estimates that 30 percent of luxury consumers by 2030 will be young people so “we want to make sure we understand what they need, how they engage with our brand….All our clients are important. We want to make sure we’re catering to differing needs across different client segments.”

Roughly half of Chanel’s revenue gains in 2022 can be attributed to price increases, and the rest volume, according to Blondiaux.

He characterized price increases as “very much in line” with inflation numbers seen in the U.S., U.K. and Western Europe. “And for 2023, I think we’ll continue to apply the same pricing strategy,” with inflation and cost of raw materials the two main factors.

Chanel’s 2022 sales results represent a slowdown from 2021, when its revenues shot up 22.9 percent at comparable rates to $15.6 billion.

Its numbers also came in below luxury conglomerate LVMH Moët Hennessy Louis Vuitton, which saw revenues jump 23 percent in 2022 as a whole, while its flagship brand Louis Vuitton shot well past 20 billion euros in revenues, maintaining its stature as the industry’s largest player in fashion and leather goods.

Overall sales at Hermès International also grew by 23 percent in comparable terms in 2022. Meanwhile Kering, saddled by problems at Gucci and Balenciaga, saw full-year 2022 revenues rise only 9 percent.

In its results statement, Nair said Chanel’s strong financials “reflect the strength of our brand, our client relationships, and the freedom of creation that defines everything we do.”

“Our fundamental belief is that when we focus on building our brand’s strength, engaging with our clients, taking care of our people and integrating a long-term perspective in everything we do, our financial performance will follow,” she added.

The company does not break down sales by product category. In fashion, it flagged “exceptional growth across all categories, particularly in leather goods and shoes.”

Chanel described “sustained momentum” in watches and fine jewerly, driven in particular by Coco Crush collections and the relaunch of the Première watch.

“Fragrance and beauty benefited from the steady return of travel retail, as well as sustained demand from local clientele,” the company said. Key launches last year include the eco range No. 1 de Chanel, and the makeup products Rouge Allure L’Extrait and Les 4 Ombres Tweed makeup.

Chanel ended 2022 with a net cash position of $2.37 billion, up 322.3 percent versus the prior year, while free cash flow decreased 22.2 percent to $3.53 billion.

Profit after taxes amounted to $4.6 billion euros, up 14.2 percent versus the prior year.

Chanel grew its headcount by 12 percent last year — about 3,600 people — and counted 32,116 employees worldwide at the end of 2022. Hirings were focused particularly on digital, IT and sustainability roles, with the number of the latter experts vaulting 60 percent.

Alongside its financial results, Chanel highlighted efforts to respect the environment and support its employees, a reflection of the expertise of Nair, who joined the French fashion and beauty house in January 2022 from Unilever, where she was chief human resources officer.

“With our expanding international footprint, we are determined to contribute positively to the environment and our communities,” Nair said, noting the company would significantly increase funding of Fondation Chanel, a philanthropic organization focused on gender equality. In 2022, funding was raised to $100 million annually.

Blondiaux noted the company last year took steps “to support our people through inflationary pressures and continued periods of uncertainty, with tailored training, commitment to pay equity and access to flexible working.”

Separately on Thursday, Chanel unveiled plans to expand its global headquarters in London and move its teams to a new building at 38 Berkeley Square by the end of 2025.

Designed by architects Piercy and Co. and to be constructed “to the highest standards of sustainability and accessibility,” the new building is more than double the size of the current Chanel headquarters in the Time & Life Building at 1 Bruton Street.

Chanel moved its global headquarters to London from New York in 2018.

Its tenancy agreement at the new building is for 20 years, with an option to extend to 30 years, demonstrating “Chanel’s intention to continue to grow its global community in one of the most creative, international and diverse cities in the world,” the company said.

Nair and Blondiaux expressed a positive outlook despite broad macroeconomic challenges and market uncertainties.

“We remain confident in our ability to deliver sustainable and healthy growth,” Blondiaux said.

“This is a time to focus on our fundamentals, our brand, our clients, and our people,” Nair added.

>>> US After Hours Summary: MRVL +17.8%, GPS +14.4%, WDAY +7.9% higher on earnin

After Hours Summary: MRVL +17.8%, GPS +14.4%, WDAY +7.9% higher on earnings; ULTA -7.3%, DECK -2.7%, RH -2.2%, COST -0.2% lower on earnings

After Hours Gainers:

Companies trading higher in after hours in reaction to earnings/guidance: MRVL +17.8%, GPS +14.4%, WDAY +7.9% (also names new CFO), ARCE +3.1%, ME +2.9%, LGF.A +2.5%, DOMO +1.8%

Companies trading higher in after hours in reaction to news: PDSB +13.1% (announces interim data on PDS0101), GNLX +6.4% (announces publication of topline data from Phase 2 VIRO-15 Trial), CUE +6.3% (presents data from phase 1 trials of CUE-101), PARA +5.7% (controlling shareholder secures $125 mln investment), CGEM +5.6% (to present first monotherapy clinical data for CLN-619), TALO +3.5% (Zamajal to acquire a 49.9% interest in Talos's Mexican subsidiary), GPCR +2% (initiates Phase 2a study of GSBR-1290), BOH +2% (to move to S&P SmallCap 600 from S&P MidCap 400), THRX +1.9% (reports data from ongoing Phase 1/2 trial of THE-630), GERN +0.6% (NDA submission on track for June 2023), REGN +0.3% (announces data evaluating combo of fianlimab and Libtayo), TEVA +0.3% (exploring options for bowel inflammation drug, including a potential sale, according to Bloomberg), F +0.3% (reaches agreement with TSLA providing Ford EV customers access to Tesla Superchargers), WTM +0.2% (names new chairman), VMW +0.1% (names new CFO)

After Hours Losers:

Companies trading lower in after hours in reaction to earnings/guidance: ULTA -7.3%, DECK -2.7%, RH -2.2%, ADSK -0.4%, COST -0.2%

Companies trading lower in after hours in reaction to news: TLRY -19.1% (commences $150 convertible notes offering), HMST -4.2% (to be removed from S&P Small Cap 600), RLAY -1.9% (announces full dose escalation data for RLY-4008), EXAS -1.3% (files mixed shelf securities offering), HLI -1.2% (reports certain revised financial info), MDU -0.4% (KNF to join S&P MidCap 400 after spin-off), IMAB -0.3% (announces phase 1b/2 study results of patients with advanced NSCLC), MRK -0.2% (announces data from pivotal Phase 3 CLEAR study 307), PFE -0.1% (presents scientific advancements from its leading oncology portfolio), BMY -0.1% (announces results from pivotal TRANSCEND CLL 004 study)