When Golden Gate Capital started its catalog acquisition binge about three years ago, the joke around the office was that very soon the private equity player would own all the women’s apparel books. Well, that hasn’t quite happened yet. Three years later, it only owns most of the clothing catalogs in the U.S. Now, at least through its Orchard Brands division, Golden Gate is going after hard-goods catalogers.
As Orchard Brands CEO Neal Attenborough tells Mark Del Franco in our cover story “Golden boy,” the multititle mailer just bought senior gifts and accessories catalog Gold Violin in September. And hard-goods acquisitions is “probably where we’ll focus for now,” Attenborough says.
Orchard Brands’ acquisition of a small niche player such as Gold Violin is starting to remind me of the rollup firms of the 1990s — Genesis Direct, Fulrum Direct, et al. Genesis, for instance, built up of a stable of more than 30 catalogs in three years before filing for bankruptcy, reorganizing, and eventually disappearing.
Gold Violin’s concept ties in with Orchard Brands’ quest to dominate the mature market. But the merchant — founded in 1999 by an entrepreneur who couldn’t find a suitable birthday gift for her 87-year-old grandmother — is a far smaller, specialty marketer compared to Orchard’s key holdings such as Appleseed’s, Blair, and Norm Thompson. How is it going to fit in?
It’s a good sign that Orchard Brands aims to keep the management of the catalogs it acquires in place, and Gold Violin will certainly benefit from its new parent company’s economies of scale. Plus, the success of Cornerstone Brands shows that catalog consolidators can work.
Still, I’m not sure how big the $1.1 billion Orchard Brands can get and how far it can expand its merchandise niche while keeping the spirit of its individual titles intact. I would hate this to be the genesis of another Genesis.