Good afternoon everyone.
I spent an extended Labour Day weekend away from my devices and with friends in the backcountry of Algonquin Park, bouncing between lakes and generally roughing it in the woods. I think the kids call it touching grass and I can’t recommend it enough.
In today’s newsletter: Who will control the future of SSENSE, the most anticipated movies premiering at TIFF today, people are taking beta blockers before first dates.
I couldn’t tell you how many hours I’ve spent scrolling the SSENSE site over the last few years. I’m rarely looking for anything specific, and I hardly ever buy anything, but I’ve always enjoyed the dichotomy between their surprising selection and predictable imagery. I’m hardly alone: in 2021, the site saw more than 1 billion page views, mostly driven by a new generation of shoppers that other retailers were struggling to engage.
All that is to say is that when SSENSE started aggressively marking down products, people noticed. At first the sales were good, then they were constant. You didn’t have to be a retail expert to see there was a problem: the company had too much inventory on hand (as many as 4,000 items were uploaded to the site every week), and started relying on sales to fuel growth after taking on investment from Sequoia, also in 2021.
The next four years saw some ups and downs: SSENSE became the most influential retailer online, with a knack for both mirroring and driving the cultural conversation. But demand for luxury was waning. Hundreds of employees were let go. The brand was accused of selling counterfeit goods and promoting a toxic work culture. In June, the company’s liabilities outweighed its assets by about $100 million, and the end of the de minimis exemption was set to impact sales into the U.S., it’s biggest market.
So what are you, at this point, to do if you are one of the several lenders owed $145 million but to publicly declare lost confidence in the company’s leadership and try to force a sale? That’s what happened, but what’s highly unusual, according to some high-ranking corporate lawyers I’ve spoken to this week, is the misalignment between the lenders and leadership that places a big question mark over the company’s future.
A few things on how this is playing out legally that I think are interesting: lenders who are looking to recoup their money would typically place a company into receivership, which takes a sledgehammer to day-to-day operations and solely prioritizes them getting paid. That would scare customers and destroy the brand, so a move to file for creditor protection instead tells you they’re trying to preserve the value of company.
The standoff between lenders, who want to sell SSENSE, and leadership, who want to retain control and restructure, have resulted in both filing for creditor protection. Two competing applications leaves it to a judge to decide which one to accept, or which aspects of each to accept. Only once that decision is made will we have an answer to the biggest question facing the county’s most influential retailer: Who’s in control?
It’s film festival time in Toronto: TIFF’s 50th year will light up the entertainment district from today until September 14. The films that people seem to be excited about tonight include John Candy: I Like Me, a documentary produced by Ryan Reynolds, and Erupcja, a movie that Charlie XCX secretly starred in. I am not the audience for all the celebrity coverage that comes out of these two weeks but it is very cool that Dua Lipa went to my fifth-favourite restaurant Giulietta last night.
People are supposedly popping beta blockers before first dates now. There seems to be a link between prescriptions and those who listen to Giggly Squad.
Sheertex is bringing on BonLook co-founder Sophie Boulanger to replace Katherine Homuth as CEO. The company raised more money from existing investors earlier this year (Homuth’s departure was reportedly part of the deal, and she was asked to cool it on social media) in an effort to get to profitability.
A very real debate facing restaurants is how friendly they should be with influencers. We’ve all seen the power of virality when it getting a restaurant off the ground, but I’m seeing more operators speak out against ring light carrying guests and outlets like Eater and Toronto Life saying enough’s enough. Jen Agg, who’s behind restaurants like General Public and Grey Gardens, had this to say:
RTO is turning parking lots (and city bike stations) into a battlegrounds.
Old Navy says that 70% of surveyed customers say they would buy beauty products from the brand. The company is now launching make up in the fall.
Would you pay $2,000 for a 20 minute call with Reddit co-founder Alexis Ohanian? I found Intro after Paul English, the founder of Kayak, announced he’d made an account yesterday. Some interesting profiles include Drybar founder Ali Webb and Casper co-founder Neil Parikh. The Hustle wrote a great explainer on the company a few years back and I’m interested to see if it sticks around.
SNL’s new cast members include Canadian actor Veronika Slowikowska.
The owners of Paris Texas are opening a jazz bar on the Ossinton strip.
“These numbers make me want to vomit.” Low ridership and Eglinton LRT delays have left Toronto’s transit agency with a $36.5 million shortfall this year.
The removal of the de minimis exemption will cost Lululemon $240 million.
If you read anything today it should be Angelina Chapin’s investigation into Selena Gomez’s mental health start up Wondermind. Before I took my last job I had interviewed for an editor role with The Newsette, a media company founded by Daniella Pierson, one of Wondermind’s co-founders. I was never able to square my weird gut feeling with all the positive press I was reading about that company.
The only coverage I needed to read about Chloe Malle’s Vogue appointment.
Mon Review has an uncomplicated, insider view of the week’s big fashion story.