6PM | CASE STUDY
SALE OF A MINORITY STAKE TO AND RAISE OF GROWTH CAPITAL FROM ABOUT YOU
An analysis of the successful sale of a minority stake of 6PM to About You. Avalon Advisory (formerly Lange Family Office) advised the founder Achraf Ait Bouzalim and his investors throughout the entire process. In December 2021, 6PM welcomed About You - a leading global e-commerce platform – as a new investor to accelerate the growth of 6PM and bring its operations to the next level.
INTRODUCTION
6PM has quickly risen to fame by establishing itself as one of the most exclusive streetwear brands, representing a cultural movement and offering an authentic experience that customers identify with, proudly carrying the brand into the World and setting 6PM apart from competitors.
6PM is the perfect symbiosis of exclusive streetwear and luxury fashion, combining the best of both Worlds perfectly tailored to Generation Z. 6PM’s drop model is especially conducive to creating hype, with items functioning as tickets to a community, enabling to build momentum and to actively steer demand to exceed supply.
Founded in 2017 and headquartered in Frankfurt am Main, Germany, 6PM follows a direct-to-consumer strategy, generating 100% of its sales through its online store at high sell-through rate with 0% returns. 6PM is devoted to the pursuit of creating individual styles with unisex fits, serving the current trend and state of the customers’ mind. The product portfolio comprises a mix of exclusive fashion pieces and accessories.
6PM has proven to create marketing campaigns with viral potential and immense reach, hence companies choose 6PM as a collaboration partner to increase awareness for their top-tier products and create credibility among their customers. Globally well-known athletes and personalities across the entertainment industry identify with 6PM’s authentic image, choosing to purchase products and promote the brand for free. Thus, generating a high level of customer retention and loyalty through successful brand-building initiatives, combined with the direct engagement led by Acharf with its loyal community across social media.
MARKET
The global apparel market is currently worth USD 1,591 billion, growing at a CAGR of around 3%. The adoption of streetwear culture and its rising popularity have greatly impacted the overall growth of the industry.
The community aspect of streetwear has infused itself into the luxury World, where brands have started to focus on the next generation of customers by adopting designs shifted towards a highly influential young audience. Established streetwear labels have the power to cultivate a community and loyal following, turning limited product releases into social status symbols, where people identify with the brands’ logos.
“Old luxury” synonymous with exclusivity, aspiration, and allure, was being superseded by a movement built on inclusivity, access, and knowledge, yet underlined by the individuals’ desire to stand out – this is called the “new luxury”.
GROWTH POTENTIAL
6PM and its founder Achraf Ait Bouzalim have been integral parts of forming the latest cultural movement within the fashion industry, relying on its reach and outstanding engagement with its community.
Despite the powerful direct-to-consumer sales approach, the brand is looking to partner with selected retailers as well as host pop-up stores to further increase its reach and drive the growth of the Company.
In addition, Achraf’s aim is to vertically expand its portfolio, launching a more diverse product range, and building the foundation for upcoming never-out-of-stock (“NOS”) product lines that are available for purchase at any given time via 6PM’s online shop.
To continue and accelerate the development of 6PM, the management team was seeking a strong partner, in order to enter the next growth phase.
KEY TO SUCCESS
Avalon’s outstanding market expertise and deep sector know-how, especially within the streetwear and sneaker market, have been the key to perfectly position 6PM. Crafting an equity story that clearly distinguishes the brand from its competitors and outlines the magic factors of Achraf led to outstanding valuation.
Avalon’s unrivalled global investor network and personal relationships played a crucial role in structuring and executing this project and find the perfect partner in an efficient manner.
As the lead advisor, Avalon has been responsible for drafting all necessary investor documents, navigate stakeholder communication as well as driving the negotiations across the entire project and manage the due diligence process swiftly.
After a competitive bidding process, About You has been able to come through as the perfect partner, offering the most holistic deal structure that perfectly serve Achraf Ait Bouzalim and his team.
Since December 2021, About You has acquired a minority stake and provided growth capital to 6PM, leveraging existing synergies and offering a perfect set-up to globally scale the Company.
CONTACT INFORMATION
Nicki Lange
Managing Partner
nicki@avalonadvisory.cc
+49 (0) 2054 87 357 94
