As students in the entrepreneur program at USC, Dee Murthy and Andres Izquieta couldn’t wait to start their men’s clothing company. Before the semester even began, they silk-screened 20 sweatshirts as a promotional gimmick for their nonexistent company.
“We had no design experience. We overpaid for the whole process. But the sweatshirts cost us $30 to make and we sold them for $40,” recalled Murthy, now co-chief executive of Five Four Clothing Co.
As the semester progressed, the partners wrote their business plan while developing the company. The unconventional approach not only won them $25,000 in a business plan competition, it proved its worth in the marketplace.
“Every part of our business plan was pretty accurate even until this day,” said Murthy. “The only part where we were off was finances. We figured we needed a few hundred grand, but we’ve blown $5 million to $6 million to get where we are today.”
To obtain that kind of money, Five Four has progressed from its original bank loan (co-signed by Murthy’s parents) to angel investors to private equity groups. Murthy cites money as the biggest obstacle for his company, but “if you have passion and people see it, it’s easy to overcome.”
The company, which recently reached profitability, sells menswear in more than 1,000 retail stores. The fashions aim for typical U.S. males ages 25 to 50 who want to move up from the basic jeans-and-T-shirt look. A pair of Five Four jeans retails for about $135; a button-up shirt goes for $80.
“They have a good aesthetic that understands the L.A. lifestyle,” said Thai Pham, a buyer for Macy’s in San Francisco who picked up the line last fall. “They offer a good value for the price a good midtier denim brand and most of their success has come from their denim.”
Izquieta, who serves as creative director, seeks to design clothes with an American aesthetic that also fits the American body type. Most high-fashion apparel fits the skinnier European body.
“In general, American men are fuller sized,” said Murthy. “In pants they need wider sides, a more generous waist and wider legs; and in tops, bigger arm holes.”
The partners plan to launch a women’s line of clothing and in the future extend their design sense into home d & #233;cor, restaurants and even hotels.
“We see ourselves as evolving as a brand that touches all parts of your life,” Murthy concluded.
Joel Russell
Dee Murthy
, 27, and
Andres Izquieta
, 27, Founders and co-chief executive officers, Five Four Clothing Co., downtown Los Angeles
Business: Maker of
fashionable clothes for typical males
Employees: 24
2007 Revenues: More than $15 million
Fact: The partners got $25,000 in working
capital by winning the Marcia Israel Award for outstanding business plan at USC
Quote: “We said, ‘Why wait till the semester starts? Let’s get this business going.’ ”
(Murthy)
