Norwest helped to professionalize our organization without a heavy hand. That is a real art.
Joe Kudla, founder and CEO, Vuori
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Company info

Company: Vuori
Industry: Apparel
Website: vuoriclothing.com
Founded: 2015
Headquarters: Encinitas, CA
Funding stage: Growth equity
Norwest investment: 2019

Investors
  • Jon Kossow photo Jon Kossow
  • Stew Campbell photo Stew Campbell
  • Connor Pike photo Connor Pike
Growth Equity Consumer

Vuori: Growth fueled by a passion for quality and the Southern California vibe

Throughout his life, Joe Kudla has pursued excellence in everything he has done, even when that drive required extra effort and raised the kind of doubts that inevitably come from trying new things. A self-described jock in high school and college, he admits he was never the most gifted player, “but I always worked the hardest.”

After a stint as a model for top apparel brands in Italy, he became a CPA and then started a successful financial and IT consulting firm. The discipline and dedication required in sports led him toward entrepreneurship, where he felt confident in his ability to build teams and plot winning strategies. But despite achieving plenty of business success, he felt something was missing. “It just wasn’t my passion; my creative side wasn’t being expressed.”

A light-bulb moment came during a yoga class where he saw other men who shared his passion for a lifestyle that paired intense physical activity with a positive view of the world. “I wanted to create a brand that aligned with guys into like-minded interests and outlooks.”

The result was Vuori. Vuori is the Finnish word for “mountain” – reflecting yet another of Kudla’s passions, mountain climbing.

A Change of Heart About Outside Investors

The company enjoyed immediate success through a combination of sales through its flagship retail store in Encinitas, CA (famed for its surfing and laid-back lifestyle), direct-to-consumer sales, and limited wholesaling. Funding came from Kudla’s savings and help from friends. Institutional investors were never on the founder’s radar, until he finally accepted an invitation to meet with Jon Kossow, a managing partner at Norwest.

Kossow’s growth equity team focuses on private, profitable, fast-growing companies that don’t lack for capital. He jokes, “we try to sell money to people who don’t need it.”

Kossow’s message to Kudla was simple: continued growth will bring more and different challenges, and a collaborative partner like Norwest can help you anticipate and mitigate those challenges. In addition, an infusion of capital could provide some liquidity to early angel investors.

“Founders want investors who can be helpful, but not overbearing. Norwest’s invited-guest mentality means they know when to be a thought partner, and when to stand in silent support.”
Joe Kudla, founder and CEO, Vuori

After Norwest purchased a minority interest in Vuori in late 2019, Kossow joined the board as the first outsider and pursued Norwest’s signature “invited guest” approach to supporting portfolio companies: “We want to be both a proactive and a reactive partner to help with any challenges the management team may have. When you have an issue, reach out to us. Otherwise, concentrate on running your business.”

Norwest has helped Vuori with pressing issues such as recruitment and compensation and was actively involved in determining a strategy to deal with the COVID-19 pandemic, which included early closure of retail stores and a pivot to large (and successful) online efforts to attract customers. Norwest also helped refine the company’s omnichannel distribution strategy, which includes calibrated allotments of products to wholesale partners as well as firm guidelines on pricing.

Kossow is impressed by what Kudla and his team have achieved – but not surprised. “The biggest element that attracted us to Vuori was Joe’s background. I doubt there’s any leader in the apparel industry who has the combination of skills and experience he has: a CPA, a fashion model, and an entrepreneur. Plus, he’s a very competitive guy. You don’t want to bet against him.”

Kossow says the success of Vuori is based on three factors: the people (Joe and his team), the product (“a maniacal focus on quality”), and the brand (“the Southern California lifestyle that’s aspirational for so many people”).

Kudla returns the compliment to Norwest. “Founders want investors who can be helpful, but not overbearing. Norwest’s invited-guest mentality means they know when to be a thought partner, and when to stand in silent support.”

He added, “Norwest helped to professionalize our organization without a heavy hand. That is a real art.”

Investment Snapshot
Vuori Investment Opportunity
  • Build a brand that uniquely captures consumer passion for an active, outdoors lifestyle
  • Offer products that are superior in quality, sustainability, and ethical development
Market Trends/Drivers
  • Rise of “athleisure” apparel
  • Success of omnichannel sales strategies
  • Aspirations for the SoCal lifestyle
Norwest Investment
  • $45 million
Portfolio Services Utilized
  • Capital Markets/M&A
  • HR & People Advisory
  • PR & Marketing
  • Talent & Retention
Outcome
  • Rapid growth in revenue and profitability
  • Stable balance of retail, wholesale, and DTC channels
  • Superior sales-per-sq. ft in retail stores
  • Subsequent investments value company at $4 billion