When Joe Kudla, founder of Encinitas-based sportswear brand Vuori, got a chance to sit down with a representative from startup investor SoftBank, he wasn’t really looking to raise funds. He saw it more as a ‘get-to-know-it-yourself’ meeting.
But that initial meeting led to another, and what started as an introduction turned into a business deal that made Vuori one of the biggest investment rounds for a San Diego startup in memory. recent.
Earlier this month, the company raised $ 400 million from SoftBank Vision Fund 2. The funding is a massive bet that Vuori can replicate Southern California’s rich history by launching successful lifestyle brands inspired by of the beach in the world.
The company will use the funding to expand its presence in the busy performance sportswear market – opening more than 100 stores in the United States over the next five years, while simultaneously expanding into Europe and Asia.
“We think now is the perfect time,” said Kudla, a San Diego native and general manager of Vuori. “The market gives us permission to grow, and we think it’s the right thing to do. “
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The deal values Vuori at $ 4 billion, according to the company. It currently operates nine of its own stores, primarily in Southern California and Colorado. Her high-end clothing is also available on her website, as well as in most REI and Nordstrom stores.
The company of 450 employees plans to employ more than 1,000 by 2024, Kudla said. It has been profitable since 2017.
A former accountant for Ernst & Young who co-founded a recruiting firm, Kudla worked for a few years as a model in Europe after college, which sparked her interest in the garment industry.
“I was the guy who always ran a t-shirt business in his garage,” he said.
He started Vuori seven years ago. The idea was to provide high quality workout clothes for men with the flexibility to be worn beyond the gym – similar to Lululemon’s niche with yoga inspired clothing for women.
“We wanted to create a product that redefined the look and feel of men’s sportswear and made it much more versatile and much more wearable,” Kudla said. “So whether you’re at the gym or walking around town on the weekend, the product will work for you.
While the company originally targeted men, Vuori launched women’s clothing in 2018, and sales are now split 50/50. Lululemon also makes premium sportswear for men, although Kudla believes Lululemon remains best known as a brand of sportswear for women.
In 2019, Vuori raised $ 45 million from Norwest Venture Partners. Sales tripled last year amid the pandemic and are set to increase 140% this year, Kudla said, proving it can be profitable on a large scale.
With the new funding, Vuori will not only expand its retail stores, but also roll out new products and invest in sustainability. Through partnerships with Climate Neutral and CleanHub, the company aims to offset its carbon and plastic footprints, eliminating 80% of plastics from its shipping and supply chain by 2022.
“With its strong commitment to consumers, its focus on sustainability and pure growth, we believe Vuori is a leading brand in the attractive sportswear market,” said Nagraj Kashyap, Managing Partner at SoftBank Investment Advisers. “We are excited to partner with Joe and the Vuori team as they introduce new products to consumers and expand globally. “