Taking a New Tack
Nautica founder David Chu embarks on a more upscale fashion voyage
David Chu is hoisting his sail again. The founder of Nautica, a fashion brand that rivaled Ralph Lauren's Polo and Tommy Hilfiger for pre-eminence in the 1980s and 1990s, has a new company and line of menswear. The eponymous collection has just gone on sale at Saks's flagship Manhattan store, occupying privileged sixth-floor retail space nestled alongside the likes of Giorgio Armani and Ermenegildo Zegna.
This time around, though, Chu says he is offering the clothes he himself would like to wear and that reflect his own successful, global lifestyle. "I just turned 50, I travel a lot, I work out, my mind is active," he says. "It's a young mind and attitude, an aspirational lifestyle."
Translated, that means the elegant look of a pinstripe suit made of an Italian fabric that is pulled a little closer to the body than a traditional suit. It might be paired with a French-cuff cotton shirt, a lavender silk tie, all topped off with a pocket handkerchief. Or a cashmere blazer or leather sailing jacket atop a cotton corduroy shirt. Whatever the ensemble, it won't appeal to a mass-market wallet. Suits will fetch $1,000 to $2,000, shirts $185, and sweaters $400. "We're expecting our average sale to be about $3,500," says Steven Toia, vice president of sales.
"He's taken a very different approach to this from Nautica and at a much higher price point," says Robert Bryan, men's fashion director for the New York Times magazine, who viewed the spring collection at a faux photo shoot in Chu's Chelsea headquarters. "He's doing it in a fairly classic, elegant way."
Accidental designer. Chu backed into the fashion business. A student of architecture, he took a design class at the Fashion Institute of Technology, where his drawing skills caught the eye of a professor who suggested he try his hand at clothing. Starting out as a women's wear clothing designer, as he was trained, was hardly a popular choice for a prototypical Asian immigrant who might have been expected to become an engineer or a doctor. His family had emigrated from Taiwan to the United States in the 1960s and opened a restaurant. Though the entrepreneurial fire obviously burned bright in the younger Chu, he says, "I didn't want to work in a small Chinese restaurant."
Chu grew up in New York and Connecticut before deciding to return home to Taipei, where he started an export business with some friends. "A year and a half later, we had blown all the capital we had," Chu recalls. "I said, 'You know what, maybe I should go back to the United States.'"
His timing was propitious. After a stint working for a division of a large conglomerate, Chu began peddling some designs of jackets inspired by coats worn by sailors. They were a hit with Barneys and Bloomingdale's, and Nautica was born. The first year, the company's sales were $700,000, but a year later, those had more than tripled to $2.5 million. From there, the rise was meteoric. The rugged, casual designs proved popular, but the business needed capital, so Chu partnered with State-O-Maine, which made pajamas and other sleepwear. Nautica eventually became a $1 billion worldwide brand and was bought in 2003 by vf Corp., a huge apparel maker whose brands include Lee, Wrangler, and North Face. Chu, who reaped more than $100 million from the sale, remained as Nautica's CEO and creative head until severing his ties last summer.
Then, as he tells it, "I played golf for eight, nine days," before deciding it felt too much like work. Next stop: Italy, where he hooked up with old contacts in the apparel game and began working on the new collection.
Chu's success has not gone unnoticed outside the clubby world of New York fashion. He was honored in May by the Asia Society for his success as an Asian-American entrepreneur.
Hands-on boss. Chu has gathered a small handful of trusted associates at his dc Designs International offices and is financing the venture himself. He is keenly involved in all aspects of the operation. "I remember the early days of Nautica, when I started in 1983." But as the company grew, Chu found himself distanced from the hands-on operation. "I missed the early part. Some of the drawings you really can't delegate to somebody else."
But he credits working within a large corporation for making him a more disciplined businessman, and he thinks this time around he can expand the business even more quickly. "I didn't learn business, I didn't study business, but after a couple of years of experience I learned the business. Design is not just drawing beautiful pictures."
He is scouring the globe for suppliers, drawing on the relationships he built up while at Nautica. "This is a start-up, but it doesn't feel like a start-up. After 20 years, I think I can do it a little faster," he says. "I am coming in with a little more of a rifle approach."
Ironically, Chu says, Nautica was not really about sailing per se. "When I was in college, I used to go down to the islands a lot. I loved the blue sea, being on a boat and the ocean; it's about freedom."
He brushes off questions about how big his new venture will become, although he is already working on the spring 2007 collection and traveling to set up distribution networks and arrangements with textile and fabric suppliers. For now, Chu is focusing solely on menswear, but he was trained as a ladies' clothing designer and he acknowledges, "I think eventually I will go there."
It's the connections he made while running Nautica that have served him well this time, earning him coveted floor space inside Saks that is normally reserved for a proven draw. But the chain's executives don't think they've made a rash decision to give Chu 1,300 square feet of the most expensive retail space in America. "David's a great designer," gushes Saks Chairman Fred Wilson, who had stopped by to check on how preparations are going. "We're very pleased."
Oh, and about that architecture training? Well, he's putting it to good use. He's working with his brother, who is an architect, to refurbish a six-story, 19,000-square-foot Manhattan brownstone, a few blocks from his current office. The building will be a showcase for his fashions as well as home to a custom tailoring shop. He bought the townhouse and is restoring it to its original condition. "I think what's driving me is the stimulation. It's not about the destination; it's about the journey."
The same might be said of sailing.
AT A GLANCE
Clothing designer David Chu , founder of the highly successful Nautica brand, has launched a new menswear line.
Who: Chu, 50, an immigrant from Taiwan, started as an architecture student but moved into fashion. His designs of jackets inspired by sailors' coats led to the creation of Nautica.
How: The designer, who pocketed over $100 million from the sale of Nautica, is bankrolling the fledgling venture and working on it with a handful of close associates.
How much: In Chu's upscale new line, suits start at about $1,000, a shirt goes for $185, and a sweater will set you back $400.
This story appears in the October 3, 2005 print edition of U.S. News & World Report.