LONDON — Black is the color of year for Victoria Beckham, whose brand has hit a long-awaited milestone and turned profitable for the first time, according to the company’s private equity investor, NEO Investment Partners

In an exclusive interview ahead of Victoria Beckham’s fall 2023 runway show in Paris, David Belhassen, founder and managing partner of NEO, confirmed that 2022 EBITDA, or earnings before interest, taxes, depreciation and amortization, was positive.  

He did not give the specific EBITDA figure for Victoria Beckham Holdings Ltd., but the full profit and loss account will be published later this year when the brand posts its 2022 results on Companies House, the register of U.K. businesses.

In fiscal 2021, the company reported that losses before interest, taxes, depreciation and amortization more than halved to 2 million pounds compared with the previous year.

Belhassen said that, had it not been for the COVID-19-related lockdowns, the business would have reported a positive EBITDA two years ago. 

He added that in 2022 revenues were up 42 percent to around 58 million pounds, and that he’s expecting further, strong double-digit growth in 2023.  

Belhassen described the business as “healthy” with 3.2 million pounds in bank debt, mostly for working capital. 

During an interview at NEO’s London offices, Belhassen also talked about the myriad changes that helped make Beckham’s brand profitable, and about his medium-term projections, and aspirations, for the business.

NEO, which specializes in high-end lifestyle brands such as Ami Paris, Vuarnet, Valextra, Pierre Marcolini and Ladurée, purchased a minority stake in Beckham’s business for approximately 30 million pounds in 2017.

The deal valued the business at around 100 million pounds, and NEO became a shareholder alongside David and Victoria Beckham.

Belhassen described NEO as “a very long-term investor. I like to build businesses over time.” Entrepreneurs, he said, “put their soul into their company and then they invite you into their work and their life. Partnering with them is like marriage.”

He invests in small businesses with revenues ranging between 5 million pounds and 20 million pounds, and said he enjoys working with entrepreneurs who have ideas that stir desire in the minds of consumers.  

These entrepreneurs, he added, conjure “something totally intangible that creates an impulse, a desire,” said Belhassen, who is as enthusiastic about Ladurée macarons as he is about Marcolini’s chocolate bunnies and Beckham’s bestselling watch chain clutch.

The clutch style, part of a major accessories push, will enable Beckham’s business to achieve “more than” 100 million pounds in revenue in the next couple of years, Belhassen said.  

Around half of that will come from fashion, with the other half generated by the beauty and skin care business which Belhassen helped Beckham to launch in 2019. 

Victoria Beckham Beauty, which is mainly an online, direct-to-consumer business, has since expanded its footprint by opening a U.K. warehouse and striking a deal with Bergdorf Goodman in fall 2021. The website has added storefronts in Australia and Canada, two of its top-performing markets.

Going forward, profits are set to grow further due to a number of changes at the company.  

As reported in 2021, Beckham consolidated her fashion offer under a single Victoria Beckham label, and slashed the average price point to around 550 pounds. 

Encouraged by demand for her beauty products and growing brand recognition, Beckham also lowered the entry price points of the collection to around 100 pounds.   

In a 2021 interview, Beckham told WWD she loves to see her beauty and fashion products work together as part of a full lifestyle offer, “and we’ve done a lot of mixing between beauty and fashion. We want to support our customers, facilitate their lives, produce a curation where you find these [beauty and fashion] products together.” 

The company has also refined its sourcing, supply chain, manufacturing and distribution to ensure that deliveries land on time. Beckham showcases four collections a year, following the seasonal calendar, and has reduced stock keeping units by about 30 to 35 percent, compared with past years.

The strategy wasn’t all about subtraction.

Beckham also relaunched footwear and leather goods under the new brand and pricing structure and introduced the VB Body collection last spring.  

Belhassen said that, in addition to those changes, work has been going on in the back end of the business. They’ve added a finance team and upgraded the IT and digital planning systems for the day-to-day operation of the wholesale and retail businesses. 

Belhassen said that Beckham and her design and product teams now have full visibility on sales “every day, and every week. There is a constant flow of information which the creative team can use. It means they can work with freedom and with confidence.”

The U.K., Europe and the U.S. are currently Beckham’s top three markets, and Belhassen said the U.S. is fast becoming number one. Worldwide, e-commerce is growing in the double digits. The next push will be in Japan, China and Korea, he added. 

Belhassen said Beckham has embraced the changes with vigor, positivity and a ferocious work ethic. “Victoria has been unbelievable — on fire — and taking on every single challenge,” said Belhassen, adding that showing in Paris was a “massive” move for her.

Beckham staged her first runway show in Paris last September. On Friday, Beckham’s second Paris show will take place once again at the 17th-century church and monastery of Val-de-Grâce in the 5th arrondissement.  

Belhassen said he invested in Beckham’s business because her approach is authentic, and because she wants to offer best-in-market products, which she’d be proud to wear herself, he said. “She wants to create a legacy,” said Belhassen, who confirmed that NEO is partnering with her for the long term.  

“I’ve never made an investment for the sake of investing. I have to love the product and the people, and it has to be an amazing adventure. It has to be genuine,” he said. 

While many private equity firms would look to exit in three to five years, Belhassen stays in the game for longer.

He remains invested in Ami Paris even after selling shares to Sequoia Capital China in 2021, and has held stakes in the Belgian chocolatier Pierre Marcolini and Vuarnet for nine years and eight years, respectively. 

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