Hong Kong money to help online fashion disrupter Moda Operandi break into the Asian market
Straight-from-the-catwalks e-tailer that brought emerging labels such as Delpozo to fashion lovers’ attention wins backing of entrepreneur Adrian Cheng to bring its curated collections to Asia. Founder Lauren Santo Domingo tells us what to expect
Last year, Hong Kong entrepreneur and art patron Adrian Cheng made an undisclosed but significant investment in online retail platform Moda Operandi through K11 Investment and C Ventures, two investment funds. It was a sign that the New York-based luxury retailer, co-founded seven years ago by former US Vogue editor Lauren Santo Domingo, is getting serious about its push into Asia.
The announcement surfaced at the end of a year filled with “breaking news” from e-tailers such as Farfetch, matchesfashion.com and Yoox Net-a-Porter Group. At times, it felt that not a day went by without one of them trumpeting a new round of fundraising, an acquisition or a partnership with a publisher or a fashion brand.
Moda Operandi has built a loyal client base in the United States, Europe and the Middle East but still lacks the brand awareness of its competitors in Asia, in spite of strong sales in Hong Kong.
“We were seeing organic growth and an uptick in sales without having a single ad or any feet on the ground, so it was a natural progression to come [here],” says Santo Domingo when we meet her during Art Basel Hong Kong.
“While we can access the customer anywhere, we offer a hi-tech, high-touch experience, and to be able to serve her in both ways we needed a physical presence. Also with Adrian [Cheng], you can’t underestimate his influence in this region.”
A well-connected New Yorker, Santo Domingo founded Moda Operandi, or Moda, as most aficionados refer to it, to fill a gap that not many had seen in the market: the desire of fashion-loving, high-net-worth women to buy looks fresh off the catwalk and not to be at the mercy of department store buyers.
“The most interesting for us is access to the full collection, straight from the runway,” Santo Domingo says when asked to explain what makes Moda stand out from its competitors.
“When a designer has a runway collection, they would put 30 to 40 looks down the runway. But a retailer would buy a very small selection, so the customer is not being well served in understanding a designer and their entire offerings. We have the full collection and our client can access it as if she was sitting in the front row. That is our differentiator.”
With power having shifted into the hands of consumers, the business model of a platform such as Moda makes sense. Whereas in the past editors and buyers would dictate what women bought, things are different now. With a plethora of choices, both online and in real life, shoppers are in control.
“To expect a buyer to be able to make a selection that is going to appeal to a broad group of women is old fashioned,” Santo Domingo says.
Access to hard-to-find catwalk looks and made-to-order couture gowns, however, is not enough in an age when customers, especially the high-flying ones that Moda targets, are becoming ever more demanding. Offering a well-curated selection is also important, and this is hands down one of Moda’s key strengths.
While the website offers a breadth of brands, from new players to stalwarts such as Prada, it’s built a niche for its selection of emerging labels – brands that make you feel in the know and offer investment pieces.
Santo Domingo explains what Moda provides is something feminine and playful, but also a place to take calculated risks.
“Women are willing to take a risk but also don’t want to look foolish and spend unnecessarily buying things they don’t need. We want to push people a bit and to have fun with fashion without taking it too seriously,” Santo Domingo says.
“To be able to get things you couldn’t get elsewhere in the same way a magazine editor is seeking out those special items of the season that perhaps would be considered an inventory risk for a traditional retailer. But since we have a no-inventory model we can push things that we really believe in.”
Always on the lookout for new discoveries, Santo Domingo is the person to thank for the rise of previously unheard-of names such as Spanish brand Delpozo or Colombian designer Johanna Ortiz. “I love newness, things that nobody else has and I love the excitement and point of view of new designers,” she says.
Exposing Hongkongers to emerging brands is one of her goals. “It’s a more sophisticated audience here and there’s a better appreciation for quality and much more knowledge about the construction of clothes or designers,” she says.
“The American woman doesn’t really understand the fashion cycle and how fashion week is six months in advance. Here they know all that or the difference between ready-to-wear and haute couture. But when it comes to emerging brands only the women who travel know them, because small brands don’t have the resources to come, so we want to introduce them.”
Moda’s focus will be on emerging brands, because of the trusted relationships here between sales assistants and women at luxury brands. “So for us it’s about the new designers,” she says.
Santo Domingo’s enthusiasm, both for her job and the talent she supports on Moda, is palpable and has been the driving force helping her grow a female-led company into a force to be reckoned with in just a matter of years.
“I’ve never felt held back as a woman in anything I’ve ever done. And I think that being the customer gives me more insight. Our customer is so unique that it has to be someone who understands her and her lifestyle. So when I pitch to investors they see that,” she says.
“Our partners want us to have a successful business, so it doesn’t matter whether it’s a man or a woman. I recently found out that our most recent fundraiser was US$165 million and was the highest fundraiser ever led by a female-run company.
“To give you the stark contrast, the highest raised by men is more than a billion dollars.”
Cheng’s involvement in Moda Operandi comes on the heels of a series of savvy investments in fashion start-ups that he has made in recent months, cementing his role as a fashion mogul in the making. “What Lauren has created is a disruption in the fashion industry,” he says. “The uniqueness of the fashion pieces and the speed at which they can be bought, straight from the runway, answer to the changing needs of today’s consumers – they wants things new and now.
“So the global growth potential for Moda Operandi is immense, especially with the networks that K11 can provide – it’s a complete ecosystem K11 can offer. What’s more is the bespoke experience Lauren and her team are providing, is perfectly in line with K11’s museum-retail concept that curates a true online-to-offline experience.”
While Santo Domingo won’t confirm whether she is planning to open outposts of the famous Moda showrooms in Hong Kong (the company already has beautiful spaces in New York and London), it is probably going to happen sooner or later. She herself plans to spend more time in the city and to bring young talent to Hong Kong.
Given her impeccable taste and eye for spotting what is cool, Moda could be the right platform to inject a much-needed dose of energy into Hong Kong’s somewhat moribund retail scene, saturated as it is with the same old names.