Private equity firm Brentwood Associates has acquired a majority stake in Sundance Catalog and plans to scale the luxury retailer, long overshadowed by its sister resort and festival, into an e-commerce powerhouse, the investment firm told TheWrap.
The move came as Los Angeles-based Brentwood sold off stock in some of its niche brands -- French equestrian shoemaker Ariat International and clothier Filson Holdings -- to purchase what partner Eric Reiter called "a gem."
"It was a perfect fit for us," Reiter told TheWrap. "We've been tracking the business for probably half a decade."
Selling shareholders, including ACI Capital and Webster Capital, will retain a minority ownership stake and president and CEO Matey Erdos, along with his team, will remain.
"We're making no changes, keeping some existing team," Reiter said.
The Catalog was founded in 1989, when Sundance festival-goers began writing to the resort gift shop, asking to buy items of clothing, furniture or jewelry the store had stocked. Soon, the Robert Redford-owned shop began publishing a circular, solidifying its mail-order business.
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Now, Reiter said he and his associates will sit on the company's board and advise them on how to increase their ecommerce business. According to its Quantcast scores, web traffic to SundanceCatalog.com peaked in late December -- likely driven by the lead-up to January's Sundance Film Festival -- and declines sharply the next month.
"The reality is that, while the Sundance brand is attached to the Sundance Catalog, it's still only a piece of the overall brand and it's still in its infancy in awareness," Reiter said. "We think ecommerce will be a big part of the growth strategy."
He said the company's website will soon feature more social sharing tools -- namely, the image pinboard social network Pinterest, which has a large following in the women's apparel industry -- allowing a customer-driven expansion of the brand.
Reiter dismissed fears that rebranding itself from a niche boutique for Sundance goers and film industry elites to a larger consumer product could go the route of Nantucket Nectars beverages, once sold to the Massachusetts island bigwigs and now as common as Snapple.
"We did a lot of work to understand how big the market is and how much runway is left," he said. "And the answer is significant -- a significant amount of runway left."
- Brentwood Associates