Reformation has been let loose in the wilds of Wall Street — and chief executive officer Hali Borenstein said the brand is more than ready.
The newbie held its own in a tricky market, where investors are worried over war, interest rates, inflation and more.
Shares of Reformation rose 0.5 percent to $15.08 during the company’s first day of trading at the New York Stock Exchange on Thursday. That left it with a market capitalization of nearly $891 million.
The initial public offering was priced at $15 a share — the low end of its range — and raised nearly $211 million, including $142 million for the company and $69 million for investors, including Permira, its private equity backer since 2019.
It’s a grueling process to prepare for an IPO.
The company needs to be brought up to snuff, a mammoth registration statement laying all the intimate details of the business needs to be prepared and the questions of many, many would-be investors need to be answered.
“It’s been a long journey,” Borenstein told WWD, within an hour of when the company started trading.
“This process really has given me a lot of confidence in the mission we have,” she said. “From Day One, we set out to do retail differently, to modernize how a brand really shows up for a customer. And we spoke to a lot of different really high-quality investors along the way, many of whom today I’m really proud to call my shareholders.”
Borenstein argued that Reformation is different because of:
- The strength of its brand. “We’re brand obsessed, and this brand is incredibly resonant with our customer base. It’s a wide customer base, both mom and daughter shop Reformation. Twenty percent of new customers are under the age of 25, 20 percent are over the age of 50.” The two-year customer retention rate stands at 98 percent.
- And how the brand brings its looks to the market. “We’re leveraging data and our very fast supply chain to make sure we have the right product at the right time. And so we’re bringing 50 percent of our product to market in 60 days or less. And at our quality level with our mission, it’s pretty unheard of.”
Hali Borenstein
Courtesy of Reformation
Now that Borenstein and Reformation have made the sprint to the IPO, they need to run the marathon of being a public company, demonstrating to investors that the business doesn’t just have a nice brand, but one that is a growth machine.
Reformation has 1.1 million active customers and saw its revenues increase 15.7 percent to $507.1 million last year.
And Borenstein said the company is pursuing growth along a number of fronts — from more than doubling the store count to over 140 over the next five years to expanding in more categories and growing the business abroad.
“Today is the first day of a very long journey. We have gone out there, we’ve told our story, and we’ve had a great result,” she said. “We’re really pleased with the feedback we got, but we also know it’s time to get back to work, to put our heads down and to execute on this strategy.”
Borenstein is stepping into a very particular spotlight. Only 230 of the Russell 3000 companies were led by women last year, according to The Conference Board.
“Being a woman in retail is still less common,” Borenstein said. “But I think the real question we should be asking ourselves is, as a business that sells product to women, why is that? Why aren’t more women leading companies that sell to women?
“The fact that I actually wear our clothing, I understand our consumer just makes us so much more connected to the consumer,” she said. “And frankly, I think it’s going to be a competitive advantage for us as we stay deeply focused on a consumer on everything we do.”
Borenstein has arrived.
