If you want to needle Nick Robertson, accuse him of ripping off Lindsay Lohan’s clothes.
The otherwise affable founder and chief executive of Asos, the fast-growing online fashion store, comes as close as he ever does to getting annoyed. “Let’s just get it very clear from the outset – we don’t rip anything off,” he says firmly.
“Fashion is all about ‘inspired by’. That inspiration can come from the catwalk, it can come from celebrities, it can come from wherever. There’s a joke in fashion that there hasn’t been an original fashion item for hundreds of years. I think gladiator sandals were hot last summer. Well, what are we going to say – we ripped off Caesar?”
He has the patter of an advertising man, which is his background. But sitting amid Asos’s sleek new Camden Town offices in London – all showrooms, runways for models, rows of young designers and rails of clothes – Mr Robertson could be the editor of a fashion magazine or a couturier.
In fact, he is, above all, a retailer – selling women’s and men’s fashion “inspired by” the latest celebrity-led trends. And whatever else he may be, he is not easily flustered. Since starting the company with his co-founder Quentin Griffiths in 2000 he has had to contend with the bursting of the dotcom bubble and the direct effects of the largest peacetime fire in the UK, when the Buncefield oil depot exploded.
In the early days, the company was an unabbreviated As Seen on Screen and was closer to Mr Robertson’s roots in advertising. After working as a media buyer at Young & Rubicam and Carat, the advertising agencies, he went into business with Mr Griffiths, a former product placement specialist at Shandwick PR, who has since left Asos to start other internet ventures.
At first, the concept of identifying brands worn in films by the stars and detailing how to obtain them, did not really work. “You type in Mission Impossible, and here would come the brands that appeared in that film. It could be Oakley sunglasses, or whatever it was. We originally thought Oakley might pay us to feature in that website and, of course, they weren’t [willing]. That was the early days of the internet and nobody was willing to pay anything for anybody.”
A breakthrough came when the team decided to sell the products themselves, but the concept blossomed into its current, successful form only thanks to the reluctance of Asos’s first buyer – who formerly worked at Top Shop – to do anything but clothes. “We were telling her to go off and buy Oakley sunglasses and she was saying: ‘No, I want to go down Great Portland Street and buy some trousers and tops, because that’s what I’m used to doing.’ So she actually guided us down the fashion route.”
It was hardly an auspicious time. In May 2000, Boo.com imploded in one of the most infamous dotcom collapses. The online fashion store had burnt its way through $135m in little more than a year, after hiring hundreds of staff and designing a technically complicated – and slow – website at a time before ubiquitous broadband. “We have been too visionary,” said Boo’s co-founder Ernst Malmsten. “We wanted everything to be perfect, and we have not had control of costs.”
Asos, however, navigated its way to a successful business model, and without Boo’s lavish expenditure. “We couldn’t really go bankrupt because there was nothing to go bankrupt with, which was the big difference between us and the Boos of this world,” says Mr Robertson.
Helped by a new generation of popular glossy magazines such as Heat and Now, with their diet of celebrity snaps, Asos grew quickly without breaking the bank. But now, says Mr Robertson, Asos prefers Grazia magazine: “We’ve pulled out of the popular culture magazines and into the more fashion celebrity magazines.”
The company was just getting into its stride when, in the early hours of December 11 2005, everything blew up – literally. The explosion at Buncefield in Hertfordshire, which caused the fiercest fire since the second world war, damaged a warehouse owned by Asos.
“It was a massive blow, it couldn’t not be. Internet peak at Christmas is a little bit earlier than the high street . . . So it really was right in the sweet spot of Christmas for us. It was: are we insured? Yes. How extensive is the insurance? Well, it’s extensive.”
So the phoenix rose from the ashes. It had floated on Aim, London’s junior market, four years before, raising little cash but allowing the original seed capital investors, as well as friends and family who had put in money, to exit with a return. For a long time it was taking on the aspect of a very modest public company.
A share price chart for the first 18 months shows little movement; turnover was £4.1m in 2002 and Asos was making a small loss. Then things started to change. Asos generated pre-tax profits of £3.4m last year on sales of £42.6m. Pre-tax profits this year are expected to be almost £6m, although analysts will revise their forecasts after today’s in-terim results.
But far outstripping the rise in profits is the rise in shareholder return: since listing in 2001, the shares have risen by almost 1,000 per cent, much of that in the past 12 months.
After our interview, Mr Robertson spent part of the day watching his computer screen and speaking to his brokers at Seymour Pierce. The shares had shot up. Takeover rumours were rife: Sir Philip Green wants to add Asos to his fashion empire; Hennes & Mauritz is keen for a piece of it; Zara could use the platform.
For the first time in several years of controlled growth, something unnerving is happening to Asos. Either the stock market has begun to see the potential in this still smallish company, or a much larger beast of the fashion world is preparing an acquisition attempt, or it has belatedly succumbed to a bout of online hype.
Some of the biggest players in the British high street privately argue that it is the last option; that in spite of the evident online retailing skills of Mr Robertson and his team, there is no reason for a larger fashion name to bother buying Asos.
But if someone does come along, Mr Robertson himself – with almost 14 per cent of the company – will have a large say in what happens.
“I’m loath to put up a ‘for sale’ sign yet, because we still think there’s so much potential to be had,” he says, “and the worst thing that can happen to me personally in the business is that we don’t reach that potential and somebody cuts us short in our tracks, which we don’t want.”
He has got his own way so far.
Asos’s co-founder and chief executive Nick Robertson has learnt several dos and don’ts for setting up a business:
● Warn them of the risks first, but family and friends can be the best source of capital.
● Don’t stint on the basics: without comprehensive insurance Asos might have perished in the Buncefield blast.
● Be open to outside ideas: without its first buyer Asos might not have embraced fashion.
● Harness new technology, but do it selectively. Only now that internet speeds are fast enough has Asos introduced a flashy – but still usable – interface.
● Select appropriate premises: Asos’s head office used to be a tatty building littered with clothes rails. It was right for the company then – and its more sleek and functional building
is right for the company now.
● Be vigilant on costs and refrain from dividend pay-outs if cash is needed elsewhere: investors will understand.
● Don’t ignore your core competences: the marketing background of Asos’s team is evident in innovations such as a glossy mini-magazine that is sent to customers and is far superior to that produced by most mainstream retailers.