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Tuesday, November 25, 2014

Newport International Runway Group Latest Trends: A Start-Up Incubator With a Fashion Focus

PARIS — The jewelry designer Sara Beltrán owes part of her success to a Jaipur rickshaw taxi driver she met when on a business trip. From helping her find her house, to production and business contacts, he made the introductions. But a local connection can take you only so far. The Council of Fashion Designers of America is helping Ms. Beltrán develop her jet-set beach-vibe brand Dezso into a profitable global enterprise with its in-house incubator program.

The C.F.D.A., known for its charity fund-raising campaigns — particularly for HIV/AIDS research — and scholarships, introduced the incubator for emerging designers in 2009 as part of the initiatives of the mayor of New York at the time, Michael R. Bloomberg, to develop and retain entrepreneurs there.

The original proposal was to partner with the Fashion Institute of Technology, but Lisa Smilor, the council’s executive director, said she did not want to stake her organization’s reputation on students fresh out of school.

Instead, the C.F.D.A. set admission guidelines strictly to American designers who have established businesses at least two years old, and who have received notable press and orders from top-tier retailers. For its current class, the third generation, the council accepted 10 brands out of 35 applicants.

After starting their business with $8,000 of personal funds and growing 30 percent annually over five years, Farah Malik and Dana Arbib, the designers of the jewelry brand A Peace Treaty, hit a wall. They were looking for an opportunity. The designers, who produce in 10 countries, had organized communities of older artisans to train younger generations in order to revitalize dying craftsmanship techniques, such as camel bone carving in Rajasthan. Ms. Malik said the kind of mentoring they had fostered was missing for their own business.

Before the incubator, the C.F.D.A. already had a designer development program in partnership with Vogue magazine, which has been responsible for launching such designers as Rodarte, Proenza Schouler and Alexander Wang. However the organization’s proprietary incubator is more of a slow cooker for young brands rather than the fast-paced cutthroat competition of the C.F.D.A./Vogue Fashion Fund, which is filmed as a Project Runway-like reality show.

Ms. Smilor describes the incubator program as less marketing for the organization and more “nuts and bolts” of supporting emerging designers. “The concept was to create a space where we can help nurture designers,” she said.

After applying to the C.F.D.A./Vogue Fashion Fund and making it through the first round, the designers of A Peace Treaty ultimately decided it was not right for the brand. Ms. Malik said they decided to focus on a “sure shot that would be more lucrative.” A friend and incubator designer Jonathan Simkhai suggested they apply to the two-year program.

The C.F.D.A. underwrites half the cost of a studio in a collective workspace in the heart of New York’s garment district, which Ms. Malik likens to being on a school campus. Before moving into their studio at the incubator, she said, the designers were “isolated” in their Midtown Manhattan office.

 “The excitement and creativity buzzes with us all there,” Ms. Malik said. “It’s nice to know we’re all struggling with the same business issues. That kind of sharing is really reassuring. We crack a lot of codes together.”

Ms. Smilor said that for 10 brands competing for the same investment dollars and editorial attention, the incubator is more of a community than a competition for the fellows. “They really are all for one and one for all,” she said.

In the first part of the two-year program, designers selected for the incubator get an intensive eight-month business finance and marketing education as part of the C.F.D.A.'s partnership with Stern School of Business at New York University. Because the designers have established businesses, their brands also act as a case study project for the M.B.A. students, who work with the designers to develop business plans that include e-commerce and finance strategies.

Having the tough love of aspiring business sharks pick apart and critique her business was sometimes uncomfortable for Ms. Malik. “We’ve been very proud about building our business ourselves from the ground up,” she said. “Sometimes it felt too big and I had to negotiate my feelings around the program. But it was the best treatment we could have gotten.”

Beyond the textbook education of running a business, Ms. Beltrán said the value of the incubator for her was also the introduction of work discipline. “I was dying to have routine,” she said in Paris during the recent fashion season. “I needed to have a more formal business structure.”

Integrating the M.B.A. students and designers has a marked effect on the designers’ language when they talk about their lines now. Ms. Malik refers to her brand’s “DNA” when discussing A Peace Treaty’s identity, which she describes as “global ethnic modern for the contemporary girl.” Ms. Beltrán also uses the same term when talking about Dezso’s look.

Before joining the incubator, Ms. Beltrán knew her company from every angle, but talking about it in a business pitch was stressful for her. That new business language also prepares the designers to present themselves and their brands to potential investors and executives, such as in a recent presentation to Pierre-Yves Roussel, chief executive of LVMH Fashion Group.

Throughout their residency, industry executives are assigned to incubator fellows as mentors to help them identify personal challenges and guide them in developing their businesses.

Shira Sue Carmi, a fashion business consultant, is acting as a mentor and helping Ms. Beltrán streamline Dezso and transition the brand from a casual summer line, which in early designs used materials like leather and sharks’ teeth cast in rose gold, to the high-end luxury market. Mexican bracelets from her first collection retail starting at about $100, and more recent pieces with semi-precious stones retail for up to $95,000.

The C.F.D.A. not only wants to elevate designers’ business operations while in the incubator, but also foster their creativity to continue developing their lines. Through partnerships, designers are granted allowances for travel and funding for business projects. Ms. Beltrán, for example, will shoot a video lookbook in Puerto Rico. A Peace Treaty will travel to Colombia for inspiration for their coming collections.

As the C.F.D.A. prepares to start taking applications in spring for the next generation, Ms. Smilor said it was exploring the possibility of creating a showroom for the designers.

The business development and skills the designers receive in the incubator are fueling more than just their existing brands.

“The idea is that when I leave the incubator everything is under control so that I can take the next step,” Ms. Beltrán said. “But I cannot do just jewelry. My dream is to design a hotel.”

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