Searching the supply chain for investment

When it came to finding an investor, lingerie brand Lively looked close to home – shifting the dynamic between company and manufacturer.
searching supply chain hero
Pop quiz:
How many suppliers does it take to make a single bra?
Anywhere between 25 and 40.

For Michelle Cordeiro Grant, founder and CEO of Lively, finding a manufacturing partner would be crucial to the launch and subsequent success of her lingerie brand.

She took the strategic decision to partner with intimates manufacturing supplier Gelmart to set up a strong supply chain and deliver on her goals of product differentiation, price and scale. ‘It can take up to 40 suppliers, each supplying a component, to make one bra, so finding a partner in Gelmart made getting off the ground and continuous growth much easier,’ explains Michelle, who launched Lively in 2016.

But manufacturing wasn’t the only way Gelmart would be involved with the US DTC brand – it also became an investor.

Lively received its first investment from Gelmart and has received investment from it in every round since.

Gelmart also built the brand’s factory to help streamline operational efforts. ‘I consider myself very lucky to have met Yossi Nasser, the third-generation CEO of Gelmart, who has been an amazing supplier and investor for us,’ says Michelle.

There have been significant benefits to this strategy. Michelle notes the brand has never had to do a single markdown. ‘Building the brand and manufacturing the product are both huge tasks, and it can be impossible to do both well. Working with Gelmart has allowed me to focus on brand, and also lets us have a really flexible inventory,’ she says. ‘As a result of the relationship, the sampling and production process are both more seamless and changes can be made faster.’

The relationship between brand and supplier was also a key differentiator for investors further down the line.

‘We did go on to raise money from angel investors and then VCs, and those first investments came through Yossi and me showing a differentiated dynamic between a supplier and an entrepreneur that hadn’t been traditionally seen,’ says Michelle.

Partnering with a manufacturer made sense for Lively because Michelle’s biggest obstacle to launch was the supply chain. ‘You have to think about what your biggest hurdles are, and whether there is an investor that can help you achieve that hurdle out the gate,’ she says. ‘At the end of the day, I like to think of investors like getting into a marriage; you want to make sure all parties share the same values and vision for the brand.’

This article was first published in Courier Issue 34, April/May 2020. To purchase the issue or become a subscriber, head to our webshop.

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