He was also headstrong, often fighting with faculty members who looked to conventional Seventh Avenue brands — Calvin Klein, Donna Karan, Ralph Lauren — for inspiration. Jacobs wasn't interested in tradition, instead committing himself to streetwear that was at once casual and luxurious. He was on to something. Upon graduation in 1984, Jacobs began to rack up awards, including several from the Council of Fashion Designers of America, who named him the youngest-ever recipient of the Perry Ellis Award for New Fashion Talent.
Three decades later, the reign of Marc Jacobs is far from over. He has become the most influential American designer of his generation, responsible for dusting off an old heritage brand (Louis Vuitton) and turning his namesake label into a global powerhouse (Marc Jacobs's revenue reached $950 million last year, according to financial intelligence group PrivCo).
Next week, the Marc Jacobs brand will launch a new website as it officially merges its high-end Collection line with the cheaper Marc by Marc Jacobs, which announced it would be folding into the flagship label in March. This signals a crossroads for the company and is seen as the next step toward its ultimate goal: going public.
Ever since Jacobs left his post at Louis Vuitton in October of 2013 to focus on his own brand, it has been widely reported that Marc Jacobs is looking to file for IPO. This is a move that could take place in as soon as a few months, although sources close to the company say it will more likely happen within the next year and a half. Regardless of the timeline, one thing is clear: Marc Jacobs is well on its way to becoming the next billion-dollar fashion brand.
The first Marc Jacobs pieces were oversized sweaters with polka dots and cartoons hand-knit by Jacobs's grandmother. The sweaters were part of Jacobs's senior thesis at Parsons and were first sold at the Upper West Side's famed Charivari boutique, where he had worked as a teenager. They became a retail hit.
"He was one of the early designers to bridge the gap between what was happening on the streets and what could happen on the runway."
The sweaters also caught the attention of Robert Duffy, an executive at sportswear company Reuben Thomas who would go on to become Jacobs's longtime business partner. Jacobs worked with Duffy at Reuben Thomas for two collections until he was fired in 1985, due to behavior related to his drug use (Jacobs suffered from addiction for many years, but has been sober since a 2007 rehab stint). But by then, Paper, Details, and the Village Voice had all already hailed Jacobs as a promising fashion talent; he was even called the industry's "golden boy" by WWD.
According to Harper's Bazaar, Marc Jacobs was "anti-attitude, anti-establishment, anti-marketing, anti-slick, anti-materialistic, anti-adult. The Marc Jacobs girl looked like she'd stayed out all night — tousled hair and visibly dark circles under her eyes; a Marc Jacobs [coat] is like a college girl's great army-surplus-store find — except that it costs almost $2,900 and is made from incredibly sumptuous cashmere."
"In terms of aesthetic, he was one of the early designers to bridge the gap between what was happening on the streets and what could happen on the runway," says Washington Post fashion critic Robin Givhan. "He wanted to take everyday clothing and elevate it into something rare and special."
Shortly after he left Reuben Thomas, Jacobs started his Marc Jacobs label with Duffy. The two worked from a small space in the garment district while Jacobs took consulting jobs at brands like Iceberg and Kashiyama to support the project.
Times were tough for the pair, notes Fern Mallis, the former executive director of the CFDA and creator of New York Fashion Week: "It was remarkable to see someone so passionate and dedicated, even amidst money troubles." The business filed for bankruptcy several times, she adds, before it eventually found stable financing.
Wanting to capitalize on Jacobs's buzz, Perry Ellis brought the designer on as its vice president of women's design (and Duffy as its president, responsible for the business end) in 1989. "They wanted me to do more commercial, ladylike clothes," he told the Independent. "I tried to do what they wanted. And I was miserable. I didn't sleep at night." He designed a few on-brand collections for Ellis before debuting his groundbreaking grunge collection in 1992. Dressing models in layered flannel shirts, cashmere thermals, and Dr. Martens, Jacobs was met with both admiration from fans and horror from the establishment.
The collection caused Jacobs and Duffy's contracts to be terminated, though it left its mark on fashion history and Jacobs's career. "Unquestionably, the grunge collection that Marc Jacobs designed for Perry Ellis was a defining moment," says Tom Kalenderian, an executive vice president at Barneys. "Marc Jacobs forced the intersection of pop culture and high society. Always a maverick, he took a risk to make this statement."
For the next five years, Duffy and Jacobs focused on growing Marc Jacobs.
"The Marc Jacobs brand defined cool," says Eric Wilson, InStyle's fashion news director and a former fashion critic for the New York Times. "It was all about his attitude, his friends, the type of models he used, the indie music scene he was involved with, the young models and actresses like Kate Moss and Naomi Campbell that surrounded him. He defined New York fashion in the nineties."
"The Marc Jacobs brand defined cool. It was all about his attitude, his friends, the type of models he used."
Mallis says the brand's fashion shows, which to this day close out NYFW, drew an unprecedented amount of "excitement and anticipation because it was one of the few shows that had a European scale of set — most American designers chose minimalist presentations."
"You never really knew what to expect at Marc Jacobs fashion shows," Givhan adds. "You'd see the same trends all week, and then something new would come out of the clear blue sky from Marc, and it would change what everyone thought. I think his designs resonated with people because it was clear he wasn't in it to obtain this enormous commercial footprint, unlike other New York designers. Marc Jacobs wasn't about being an advertising juggernaut. He drew people in and made them listen because of the sheer creativity that came down the runway."
All this acclaim did not translate to profit, however. In 1996, sales totalled just $2.5 million, according to the Wall Street Journal. At the time, Duffy admitted the brand was living "day to day, season to season," and that he'd taken out a second mortgage on his country home so that the Marc Jacobs line could continue to barely survive.
That year, salvation came in the form of French fashion conglomerate LVMH. CEO Bernard Arnault offered Jacobs the creative director position at Louis Vuitton; his task would be to establish ready-to-wear for the accessories-only heritage brand. In return for Jacobs's work at Vuitton, LVMH agreed to financially back Marc Jacobs — although the deal did acknowledge that the brand would not be an LVMH priority, a clause that would cause strife later on.
Jacobs took the offer, and for a decade and half "poured his heart out," as Mallis puts it: "No one can appreciate or understand what he went through: the type of numbers he was responsible for, living on planes, overseeing collections, ads. It was all relentless, and people who are no longer with us, like Alexander McQueen, prove that not everyone can handle similar pressures."
Under Jacobs's auspices, Vuitton saw explosive growth. Sales doubled from $1.2 billion in 1997 to $2.4 billion by 2001. When Jacobs left the brand in 2013, sales were reported to be $9.4 billion. Part of Jacobs's strategy was to elevate Vuitton by collaborating with contemporary artists like Stephen Sprouse, Takashi Murakami, Richard Prince, and Yayoi Kusama.
Under Jacobs's auspices, Vuitton saw explosive growth. Sales doubled from $1.2 billion in 1997 to $2.4 billion by 2001.
"Before Marc Jacobs, there was always a divide between fashion and art because one was seen as verified art, and the other as commerce" says Givhan. "Designers couldn't figure out how to reciprocate art as part of their collection, but Marc created a bridge so that there'd be a partnership between the two categories as opposed to suspicion."
The Vuitton years helped build the profile of Marc Jacobs the man and Marc Jacobs the brand. When Jacobs renewed his contract with LVMH in 2001, the company formalized its stake in his company, taking 96 percent and leaving Duffy and Jacobs with 4 (they still retained a two-thirds ownership of the brand's trademark).
That was also the year that Marc by Marc Jacobs, the company's lower-priced line, was launched in an attempt to grab more of the market. MBMJ became known for affordable T-shirts, quirky dresses, casual handbags, and kitschy knickknacks that appealed to younger shoppers.
"It was a reasonable business decision," says Givhan. "Rare is the brand that becomes profitable and moves ahead selling $4,000 dresses. A lot of brands were introducing lower-priced lines that were more commercial in order to gain power in producing larger quantities."
"I remember running to the stores when he launched MBMJ," adds Wilson. "It was an amazing opportunity for everyday customers to tap into that division of coolness, to get a taste of those $900 cashmere sweaters most of us coveted but couldn't touch. The line came with a younger vision that was more fun, with denim, smocks, and play clothes."
MBMJ proved to be immensely successful, giving Marc Jacobs a much-needed profit boost. By 2005, the brand's sales had soared to $400 million, according to PrivCo. But all was not well at the house.
In a 2004 interview with Wall Street Journal reporter Teri Agins, Duffy and Jacobs complained that LVMH did not support their brand enough financially. They recalled being furious that LVMH bought Donna Karan for $643 million in 2002 and invested $219 million in Fendi in 2004, but had not increased its investment in Marc Jacobs during that time. They also told Agins they were each getting paid less than $1 million by their parent company and felt poorly treated.
LVMH's Arnault told the Journal he was keen on keeping Jacobs happy; Jacobs and Duffy eventually renegotiated their contracts. In 2013, it was time to leave Vuitton behind, though LVMH remains a majority stakeholder in the Marc Jacobs brand. "The more famous the designer becomes, the harder it is to pour his identity, and ego, into a brand without his name on it," Agins wrote in the piece. "It's a predicament that neither Giorgio Armani nor Ralph Lauren ever had to face. They spent their entire careers devoted to their own namesake brands."
Wilson believes that in the short time Jacobs has spent zeroing in on his own label, the brand's collections have been "more re-energized than ever" and that consumers should expect more noteworthy movement to come.
"The past two shows were easily the best of his career," says Wilson. "It's great that he's back to focusing on his collection full-time, and you can tell he's fully embraced it in what he's presented. The long, exotic skirts and beaded tops from last season were all about embracing his passion, and the military collection demonstrated he really knows how to turn anything into a luxury version. It's so exciting to watch."
Then there's MBMJ: As of last year, the line accounted for 70 percent of Marc Jacobs's revenue, proving that the majority of Marc Jacobs devotees aren't willing to shell out wads of cash for Collection items. But 10 years after the line was created, notes Wilson, MBMJ has become a distraction for the brand: "It turned into something else, and stopped getting the attention it needed from a design and manufacturing standpoint."
Amy Larocca, New York's fashion director, agrees: "He was allocating his fancy ideas to Louis Vuitton, and the Collection was becoming rarified — you expected the great stuff to come out of Collection."
Even Duffy admitted to WWD in 2013 that the contemporary line "was getting a bit stale." In turn, British designers Katie Hillier and Luella Bartley were hired to take over creative control of the label. But this past March, the brand announced it was folding MBMJ into Marc Jacobs so it could "encompass a range of merchandise and price points" to "unify all products with a clarity of voice and aesthetic, and ultimately, to expand the product offerings."
"The brand eventually realized that if they want to be the next big design story, they need to have one big, clear vision."
Judith Russell, apparel analyst with The Robin Report, posits that fast-fashion brands like Zara and mid-level labels like Rag & Bone crept into MBMJ's territory to the point that it was no longer offering anything new.
"Their diffusion line was confusing to shoppers because they were attempting to be a luxury brand, and then some," she explains. "The brand eventually realized that if they want to be the next big design story, they need to have one big, clear vision."
Marc Jacobs is certainly at a turning point. Amidst the consolidation of its two lines, there have been massive layoffs (the most recent occurring in just the last two weeks), as well as store closings and stallings. The company has been tightlipped with the press in regards to all these changes; Marc Jacobs declined any involvement with this story.
Perhaps the most public, and telling, shift occurred in March, when Duffy stepped down from his position as CEO, remaining deputy chairman of the company's board. Sebastian Suhl stepped in in his place, and it's no coincidence that the executive has a track record for growing brands. He led Prada to its IPO in 2011, and during his two years as CEO of Givenchy, he helped significantly increase the fashion house's revenue. According to PrivCo analyst Radek Jagielski, it's obvious that LVMH has tasked Suhl with taking the Marc Jacobs brand public.
There's still plenty of work to be done, though. For starters, Jagielski believes Marc Jacobs needs to work on its brand recognition and reach. The company has 280 stores in 35 countries worldwide, with just 21 stores in the US. This is far less than other American designers with growing businesses: Michael Kors has 264 stores in the States alone, and Tory Burch has 62.
According to Agins, if Marc Jacobs wants to perform on a blockbuster level, it must up its accessories game — its handbag game, specifically. She argues that the only way the brand will be able to successfully go public is if it makes bags a cornerstone of its business.
"Every fashion company has a strong handbag line, and every major public fashion company has a huge footprint in accessories — Prada, Louis Vuitton, Michael Kors. And he doesn't have one," says Agins. "You don't hear shoppers talking about Marc Jacobs bags the way they talk about other designer brands. Marc by Marc had cool and revolutionary bags, but it's all since been knocked off by fast-fashion. These days, you can't make money selling clothes. The big business has to be in accessories."
Will it compete with luxury labels or mid-range brands? Does it belong with the Pradas or the Tory Burches?
Russell adds that as Marc Jacobs restructures, it must also decide where it belongs on the retail spectrum. Only 30 percent of its business comes from the Collection line, even though Jacobs has said it's where he focuses most of his attention. With MBMJ being combined with the pricey flagship label, it's unclear what the new, streamlined Marc Jacobs will look like. Will it compete with luxury labels or mid-range brands? Does it belong with the Pradas or the Tory Burches?
On a recent visit to the Marc Jacobs store in New York City's Soho neighborhood, much of the spring/summer military collection hung in the back marked down 50 percent (to be fair, it was the tail-end of the season). The store was quiet for most of the morning, save for several packs of tourists who browsed racks of $3,800 pleated skirts and $695 silk blouses before asking sales associates where they could find more affordable MBMJ products (they were directed to a different store, 20 minutes away).
There's also a larger question to consider: Is filing for IPO even a good move for Marc Jacobs? While Duffy and Jacobs have outsized ambitions — Duffy told the Journal that they "want to be big, like Ralph Lauren" — many believe we live in an era where fashion brands can no longer sustain themselves after going public.
Retail analyst Brian Sozzi points to Michael Kors as a primary example. The company's sales have been slipping since joining the New York Stock Exchange: "The problem with fashion IPOs is they have to hold excitement season after season to appeal to shoppers. Eventually though, the brand becomes overexposed. They start launching into every which category and the company loses its sex appeal."
"Michael Kors was initially a noteworthy brand because it was small and unique," he continues. "But once it expanded to meet the high expectations of shareholders, it just became all over the place and dropped its price point to appeal more to shoppers. That's basically where a luxury brand ends."
"Pumping out product to keep up with numbers might make some people wealthy, but it could eventually shorten the life of the Marc Jacobs brand."
Adds Agins, "Fashion by its very nature allows constant change, quirky experimentation. Once a company becomes public, it's the end of fashion." Russell notes that unlike Michael Kors, Marc Jacobs has "yet to be dragged through the mud and become cheapened with overexposure." It has, however, began expanding into other categories, launching beauty in 2013.
"Filing for IPO means the company will eventually have to make short-term decisions that will not necessarily benefit the company long-term," says Russell. "Pumping out product to keep up with numbers might make some people wealthy, but it could eventually shorten the life of the Marc Jacobs brand."
Givhan emphasizes that Marc Jacobs is known for its unpredictability — as Wilson puts it, "part of the Marc Jacobs brilliance is that there's no other way to describe the aesthetic than to say it's cool: you can't put your finger on what exactly it is" — and while this translates to Fashion Week excitement, it might not hold up when the company has to explain itself to shareholders.
"The Marc Jacobs brand is known to constantly change," says Givhan. "The past brands that have had successful IPOs have generally had brand iconography that is instantly recognizable, which doesn't change season after season. Ralph Lauren, Michael Kors, DKNY, Gucci — these are not brands that completely shift gears one season to the next. They have certain reassuring qualities to them and that's not how I would describe Marc Jacobs."
While there might be skeptics, longtime brand cheerleaders like Wilson believe that if there's anyone that can do it, it's Jacobs: "He's got the the credibility, the celebrity, and the brand to do it, and to do it reasonably well."
Editor: Julia Rubin