Opening Ceremony possibility: A store in every big city

If there is one store that has shaped fashion retail in the 21st century, it’s Opening Ceremony.

Founded by California natives Carol Lim and Humberto Leon in New York’s SoHo in 2002, Opening Ceremony was conceived as a shopping version of the Olympics, featuring emerging designers from a different country each year — beginning with Hong Kong — alongside up-and-coming American labels such as Proenza Schouler, Rodarte and Alexander Wang.

The plan was to bring the magic of travel and discovery to customers at home. But what Lim and Leon did was much more. With stores in New York, L.A., London and Tokyo, they can be credited with fueling collaboration fever in fashion, helping a younger generation discover heritage brands such as Pendleton and Levi’s, and creating a new social shopping hub for the cool crowd.

And soon, an Opening Ceremony could be coming to every major city in the land, thanks to a new investor, Boston-based private equity firm Berkshire Partners, which hopes to grow the brand’s retail presence as well as its namesake women’s, men’s and accessories collections, already sold at stores such as Barneys New York.

“Carol and I always envisioned Opening Ceremony as a mom-and-pop store,” Leon, 39, said during an interview at the brand’s New York showroom. “But we never had funding for it. We started with $5,000, then it became $10,000, and that’s what we used to open the first store on Howard Street. When we opened L.A. [on La Cienega Boulevard], we tried to take out a loan and were denied by the banks. So we had to do it all on our own. Then, following our 10th anniversary, we felt like it was time to take things to another level. We’ve always been such huge supporters of other brands, but we never reflected back on ourselves.”

“Overall, U.S. retail has been lacking creativity and newness. With Opening Ceremony, you have creativity and newness,” said retail analyst Dana Telsey, chief executive and chief research officer for New York-based Telsey Advisory Group. “They are constantly reinventing, they have brands doing exclusives for them, they are creating environments where people spend a lot of time, and they have global appeal now.”

“We’re in a time of tremendous change in the industry, and they are the future,” said Glen Senk, a former chief executive of David Yurman and Urban Outfitters, who formed his own investment firm, Front Row Partners, and is partnering with Berkshire on retail investments. Senk will serve as nonexecutive chairman of Opening Ceremony’s new board of directors. “So many people are of a mind that brick-and-mortar is dead. If anything, it’s in need of reinvention. And if anyone can do that, it’s Carol and Humberto.”

The two friends met at UC Berkeley; Lim was studying economics and Leon art history. They had been SoCal mall rats in their youth and shared a love of shopping, a nostalgia for brands, including Benetton and Esprit, and a fascination with fashion’s ability to create identity.

After graduation, Lim went into investment banking, eventually landing a job in strategic planning at luxury brand Bally. Leon ascended the ranks at Gap, Old Navy and Burberry, where he worked in visual merchandising and brand positioning.

When they decided to open a store together in New York, they thought it would be a hobby — something they did on the side while continuing their “real” jobs. Inspired by a trip to Hong Kong, where they shopped “like crazy people 24 hours a day,” they wanted to recapture that excitement in a store. So they returned for several buying trips. And because their new store concept reminded them of the Olympics, they chose the name Opening Ceremony.

From Day One, Opening Ceremony was a fashion discovery zone, with a merchandise mix of high and low, local and international, nostalgic and cutting edge, where everyone from punks to preppies was welcome. Michael Stipe was the first customer. Spike Jonze, Ryan McGinley, Chloe Sevigny and Terence Koh followed. In 2003, when Leon and Lim featured brands from Brazil, Opening Ceremony became the first store in the U.S. to carry the now-ubiquitous Havaianas flip-flops.

Industry heavyweights began to take notice of the little shop on Howard Street. In 2004, Leon and Lim joined forces with Nike to create Souvenir, a collection that tapped Opening Ceremony artists and designers such as Mary Ping and Alexandre Herchcovitch to reimagine Nike products, including Air Max sneakers dipped in rubber.

“They saw the value of partnering with us to reach a different audience because of the way we told the story of how Nike was relevant in our world,” Lim said. The collaboration, which gave Nike a new cool factor, became a model for big brands in search of new audiences.

In 2005, when Britain was the featured country at the store, British cheap chic emporium Topshop decided to test the U.S. market by selling its collection at Opening Ceremony, which became the sole U.S. retailer for Topshop until it opened its New York flagship in 2009. “When we approached brands in the beginning, a lot of them had never heard of us,” said Leon. “So we’d just tell them the story of how we discovered them. For Topshop, we explained that any time one of our friends was traveling to London, we’d ask them to bring back something, anything from Topshop.”

In 2007, Opening Ceremony was turned into a pop-up for Target’s Proenza Schouler collection during New York Fashion Week, and a line formed around the block, giving the big-box retailer serious street cred. Then in 2011, LVMH came calling, hiring Lim and Leon as creative directors to resuscitate the Japanese street luxe brand Kenzo.

With their power to transform a brand from old to gold, Lim and Leon are the alchemists of modern-day shopping. Over the years, they have designed collaborative collections with Vans, Adidas, Candie’s, Timberland, Stetson, Reyn Spooner, Teva and even fusty men’s wear brand Hickey Freeman, which raises the question: Is there any moribund brand they can’t turn?

“I don’t know if we can make anything cool,” Lim, 39, said.

Added Leon: “The truth about Tevas and all the rest of it is that it’s all stuff we never stopped being into. We have the original Birkenstocks with the closed toe from our Berkeley days, which we put René Magritte images on for a collection we did this spring with the Magritte Foundation. And we still have our Tevas from the late 1990s. I have saved everything since I was 16 years old.” (He has storage spaces in L.A. and New York.)

More than just fashion, they understand shopping as entertainment. They have tapped into the art, music and film worlds, starting in 2008 with the Chloe Sevigny for Opening Ceremony collection, which is still going strong. Opening Ceremony teamed with the Mike Kelley Foundation for the Arts to sell T-shirts and tote bags pegged to the late artist’s Museum of Contemporary Art exhibition that closed at the end of July, with director Jonze on a capsule collection inspired by the 2013 film “Her,” with Elvis Presley Enterprises on merchandise featuring images of the King and with Yoko Ono on racy clothing inspired by late husband John Lennon.

They also design their own branded products. What began in 2002 with hooded sweat shirts has grown into the full-fledged Opening Ceremony collection shown on the runway during New York Fashion Week and sold in 200 stores worldwide. It’s that segment of the business that they seem eager to focus on.

“There are categories we’re expanding so the collection can stand on its own,” said Leon. “We’re doing sunglasses and denim and relaunching kids. And down the line, there’s beauty. We’d also love a hotel partner and for someone to work with us on a food project.”

“We think about doing groceries with Trader Joe’s all the time,” Lim said.

“Don’t think we haven’t put in a call,” Leon added. “They are like Ft. Knox.”

“The strength of [the Opening Ceremony] brand presents a tremendous platform for growth across products, geographies and channels,” said Marni F. Payne, senior director at Berkshire Partners.

But the first priority will be to open stores in Boston, Chicago and San Francisco, Leon and Lim said, adding that those locations will likely showcase only the Opening Ceremony collection rather than being multi-brand stores.

They are also working on relaunching their website to better showcase merchandise as well as content produced by staffers on topics such as fashion, food, art and travel. “We’re really excited to create more videos and perhaps extend the site into print twice a year,” Leon said.

Even with the added responsibility of having to be in Paris to work on the Kenzo collection, their enthusiasm for fashion and retail hasn’t waned. “When we have a day off, all we think about is, ‘Where can we go shopping?’” Leon said. (Heath Ceramics in L.A., Ted Muehling jewelry, John Derian home accessories and C.O. Bigelow Apothecary in New York are favorites because they are “specialists in what they do,” Lim said.)

“It’s a time to be flexible,” Lim said. “Millennials look at things differently. Where we grew up with brands, now it’s so much more about an item. You download one song, not the whole album. But that’s where content becomes important. A story makes you want something so much more. It creates value.”

“We’re really good about next. We’ve never looked back and said we need to protect what was done before,” Leon said. “Everyone who works in our stores is part of a new generation that’s about movement. We’ve always been able to stay on top of that.”

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