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Gen Alpha-geared Brand Subdued Gets Investment

MILAN — Gen Zers may have been a boon for the fashion business in recent years, but a new acquisition suggests that Gen Alpha is also coming under the spotlight.

Rome-based Subdued, a contemporary brand geared at teenagers, said Tuesday that Nuo SpA, backed by one of Italy’s major investors, Exor, and The World-Wide Investment Company Ltd., of the Hong Kong Pao family, has acquired a 30 percent stake in the company.

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Financial terms of the deal were not disclosed, but the two companies said the investment is aimed at strengthening Subdued’s footprint in Europe and its digital capabilities, as well as expanding its reach overseas.

Founded in Rome in the early 1990s by Enrico Maria Sconciaforni and Alessandro Orsini, Subdued has built its unique selling proposition on offering trend-driven gear to teenagers at a fairly accessible price point. In the 2000s the brand was synonymous with the preppy look and built its reputation on unfussy ready-to-wear, including graphic T-shirts with tongue-in-cheek taglines, denim and even beachwear, as well as accessories.

“We are actively looking for companies which for different reasons have the opportunity to become global leaders in their niches,” Nuo SpA chief executive officer Tommaso Paoli told WWD.

The executive touted the cofounders’ leadership skills and business acumen. “Over 30 years Enrico and Alessandro have managed to attract a group of people who can swiftly interpret the taste of teenagers and take [it] to market. It speaks volumes about their ability to come up with the right product, open the right stores in the right locations and leverage a supply chain that can fuel this business model,” Paoli said. Subdued’s current time to market spans seven days, from designing to in-store delivery, thanks to suppliers located in Italy and Turkey.

In 2023 Subdued logged 120 million euros in consolidated sales, up 30 percent year-over-year. About half of revenues were generated abroad. The brand currently operates 85 flagships across Italy, Spain, France, the U.K. and the DACH (Germany-Austria-Switzerland) and Benelux areas and it’s strictly direct-to-consumer, with a dedicated proprietary e-commerce site.

International expansion started in 2013, Sconciaforni explained, after Subdued had amassed a cult following in Italy.

“This company was built brick after brick, always fine-tuning the strategy,” he said. “The main reasons [for success] which have remained core until today are the creation of a house brand, perfectly identifying our target customer — a teenage girl aged 12 to 20 and likely coming from an affluent family — and the opening of monobrand stores at a time [the 1990s] when wholesale was still ruling the retail game,” he said.

Between 2022 and 2023 Subdued exported its formula to the U.K., opening three stores in the country, with a fourth on its way before the end of April. Success in England triggered Subdued’s cofounders to pursue further expansion.

The company is to open its first physical store in China and go live with a dedicated e-commerce site in the U.S. by the early fall. A brick-and-mortar debut in the U.S. is planned for early 2025.

Sconciaforni touted Nuo’s structure, which he views as pivotal in advancing business operations increasingly relevant to Subdued’s growing business, such as human resources and logistics, among other aspects.

A look from Subdued.
A look from Subdued.

“This marks an opportunity to show that there are companies in their respective niches which can win on a global scale, creating value not just for us, but also for Italy and all stakeholders,” said Paoli.

Subdued was advised by Rothschild & Co. as its financial adviser and Legance as its legal adviser, while Nuo SpA was assisted by Chiomenti and Gitti & Partners, for legal and fiscal matters, respectively, and by Deloitte for due diligence.

Established in 2016, Nuo SpA focuses on long-term private equity investments in Italian mid-sized companies with the potential to grow globally, and especially in the Asian market.

The investment vehicle has made other acquisitions in the fashion space, including of sportswear brand Montura and ready-to-wear company Slowear. Other investments include those in food company Venchi, personal care company Ludovico Martelli, parent to men’s grooming brand Proraso, and digital firm Bending Spoons, among others.

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