Michael Kors’ parent company announced this week it was acquiring Versace in a multibillion-dollar deal. It’s just the latest big move for Michael Kors himself, who went from college dropout to fashion world multi-billionaire. Here’s how he did it.
From FIT to Bergdorf’s
In 1977, Kors enrolled at the Fashion Institute of Technology in New York, but dropped out nine months later when given the opportunity to sell his designs at New York shop Lothar’s. Eventually, after a buyer saw his collections in the shop window, he was able to sell his designs at Bergdorf Goodman, and his career took off from there.
Kors started his namesake collection in 1981, and had his first runway show in 1984. He gained a group of celebrity fans, ranging from Aretha Franklin to Sharon Stone to Courtney Love.
A Downturn in the 1990s
Kors looks back at the 1990s as a down point in his career, because of a combination of financial issues and an economic downturn. “It was a domino effect….And then the next thing you knew, it was all about nose rings and ugly. I mean, it was a trifecta of a nightmare for me,” he told ABC News, adding he learned to be true to himself during this slump. “The customer will appreciate that,” he said, “and they will stick through thick or thin with you if you do that.”
He ended up filing for bankruptcy protection in 1993, when an Italian company declined to continue producing his lower-priced licensed collection, KORS Michael Kors. “Because of the loss of licensing income,” he told The New York Times at the time, “we had no choice but to do this. Quite frankly, it was a combination of many things, including the loss in volume as a lot of stores, especially small boutiques, went out of business. In the last two years, we lost a good 15 to 20 stores nationwide.”
Bouncing Back, With Help From Céline
Kors restructured in 1997 when LVMH invested in his company and he launched a lower-priced line. That same year, he was hired as the designer of LVMH-owned Céline, and became the brand’s creative director the following year. At Céline, he was credited with turning the brand around with well-received ready-to-wear collections and accessories. He stayed until 2004, when he decided to leave to focus on his own brand.
A lot happened very quickly around that time. In 2003, Sportswear Holdings Ltd. bought an 85 percent stake in the company. In 2004, he launched MICHAEL Michael Kors, a diffusion line that performed well during the recession, and expanded into perfume, watches, and handbags, while also opening “lifestyle” stores across the country. He also signed up for Project Runway, where he’d become a mainstream household name beyond the fashion world as a judge. He stayed on the judges’ panel until 2012.
Going Public, and Making Bank
In 2011, Michael Kors Holdings went public. By 2014, Kors became a billionaire after shares of the company went up by 18 percent. Forbes reported he had a $360 million stake of the company, plus more money from the value of the stock he sold over the previous few years. Two people with controlling stakes in his company, Silas Chou and Lawrence Stroll of Sportswear Holdings Ltd., became billionaires before he did thanks to the company’s success.
In 2015, his company raked in more than $4.5 billion in net sales. Even still, the company announced in 2017 they would close up to 125 stores because of low sales. Nevertheless, in 2017, Michael Kors Holdings bought Jimmy Choo in a deal worth $1.2 billion.
What’s Ahead for Michael Kors and Versace
Michael Kors Holdings is changing its name to Capri Holdings Ltd. after purchasing Versace for about $2.2 billion. And Bloomberg reports the company has big plans for Versace, like doubling the brand’s sales. It plans to do so by boosting e-commerce, opening new stores, and expanding to markets in Asia. It also plans to sell more shoes and accessories.
“If you look at some of the other Italian luxury brands—which will remain nameless—they are doing in the billions of euros today,” Kors CEO John Idol said on a conference call announcing the acquisition. “So Versace is terribly underdeveloped and that’s really going to change now that they’ll have the resources of Capri behind them.”
This article originally appeared on Harper’s BAZAAR US.