FUBU Founder Daymond John Stages His Next Act
Daymond John, the founder, president and CEO of sportswear company FUBU "For Us, By Us" and one of the "sharks" on ABC's reality show Shark Tank, believes in the power of reinvention. And now he says it's time for FUBU to be reborn.
In October, FUBU will relaunch in the U.S. as FB Legacy. It's motto: "trend is short, style is forever." The clothing line, which the company describes as classic, rugged and powerful will include men's and women's sportswear and will eventually expand to include footwear, boys wear, suits and tuxedos, says John.
While John is seeking to replicate the success that he had with FUBU with the new line, he will also have to do his best to avoid making the same mistakes.
FUBU, Part One
This fall's launch will occur close to two decades after the company first unofficially began in 1992. That's when John and a friend began selling hats on the streets of Queens. They soon expanded their business, sewing the distinctive FUBU logo on hockey jerseys, sweatshirts and t-shirts. John asked his Queens neighborhood friend L.L. Cool J., to wear a t-shirt in a photograph for a FUBU promotional campaign in 1993. The trick worked and John eventually and soon his clothes were being featured in videos for Mariah Carey, Biggie Smalls and Busta Rhymes. The brand started to gain so much momentum that John and his mother mortgaged the home they jointly owned for $100,000 in start-up capital to pay for a factory and office space.
In 1994, when FUBU showed up at an industry trade show, buyers were so impressed by the line that John returned to Queens with $300,000 worth of orders. Soon they had a contract with Macy's and expanded their line to include jeans and outerwear. A distribution deal with Samsung allowed their designs to be manufactured and delivered on a massive scale. FUBU had become a must-have for hip hop artists, celebrities and anybody looking to up their cool factor. At its peak in 1998, sales topped $350 million.
Yet, quick success can be complicated. "We got so carried away with our early rush of success that we were busting at the seams, racing to get the goods out there, getting ahead of ourselves," writes John in the new book he co-authored, The Brand Within. FUBU's excess inventory landed in discount stores. "Once you hit mark-down bins, it's tough to climb out, because you've lost the sense that your clothes are fresh and vibrant," he writes.
With the exception of its footwear, FUBU left the U.S. market in 2003 and built business in Europe and Asia. But it still offered customized clothes for celebrities, and deepened its foray overseas. It also went on a buying spree, acquiring up and coming brands Heatherette, Drunkn Munky, Kappa USA, Coogi and Crown Holder. Yet, even with the lineup of brands being sold in over 20 countries, it has been hard to recreate the success FUBU saw in 1998. In 2009, worldwide revenues reached $200 million.
"We never view anyone as competition until they replace us," says John. At first, price will likely differentiate the competition. FB Legacy will be mid-priced to affordable, sold initially in specialty stores and then perhaps department stores. "The legacy of FUBU will distinguish it. The old generation will say I know and remember FUBU, and the kids will say this is not my dad's FUBU, but my FB," says John.
When it comes to marketing the new line, John will be turning to a tried and true strategy. Already, Soulja Boy, Roscoe Dash and Young Money have been flashing his clothes in their videos. Having FUBU on the backs of celebrities and stars, in videos and reality shows worked. Why fix what's not broke?
FB Legacy, the Sequel
While much about FB Legacy is the same, it's a different game. "It's like releasing a new brand," says John. There are variables -- what will the kids like, what price is best? It takes four or five seasons to get into the rhythm. This time, he's not going for the big, high-end logo, "It's about workmanship in the brand."
But he plans to take the marketing a step further. Among other things, there will be a radio tour, where people will get a chance to win $10,000 to start a business. Mostly, he's mum about what to expect. Viral campaigns are ramping up on Facebook, Twitter and on YouTube. Yet, despite all of the buzz, John is fairly sober. "I like to celebrate when there's a reason. Right now, I don't want to lose focus."
A Pioneer in an Underserved Market
When FUBU launched, it was a point of pride for African Americans. Back then, clothing companies like Timberland were just dipping a toe into the urbanwear market. When FUBU came onto the scene, customers appreciated that the line was owned by young black men and the designs were fresh and unique. John has been widely celebrated, including Brandweek Marketer of the Year (1999) and the NAACP Entrepreneur of the Year (1999).
Throughout the FUBU movie, as he calls it, there are guiding principles, one favorite: "I do today what people won't, so I achieve tomorrow what other people can't." He credits his discipline, focus and drive as an inheritance from his mother.
The world has changed immensely for John since he first launched FUBU. Twenty-five years ago, he used to breakdance on the corner of 42nd Street. Last January, John returned to that same corner where he rang the closing bell at the NASDAQ, pushing the button that controls $40 billion worth of trading daily.
"I always used my access and knowledge for my own well being, but since Shark Tank, I'm considering partnering with agencies and offering myself to corporations under what I will call 'Shark Branding'. I want to help them talk to our culture, to see if I can change how companies handle our culture, make them some money, that hopefully they will give back a portion to the community. Ultimately, I want to be a blessing to others."