American boutique chain Francesca’s has acquired Richer Poorer, a 13-year-old basics and loungewear brand, the companies told BoF Monday.
As a subsidiary under Francesca’s, which operates more than 450 stores in the US, Richer Poorer will continue its digital and wholesale channels. Next year, the brand will relaunch with new categories, such as knitwear, according to Iva Pawling, co-founder of Richer Poorer.
Francesca’s-owner TerraMar Capital, a private equity firm, said the sale marks the beginning of its M&A ambitions. “We look forward to continuing to evaluate other potential acquisitions in the space,” TerraMar Capital managing partner Joshua Phillips said in a statement Monday. The financial terms of the deal were not disclosed.
Francesca’s had been struggling ahead of the pandemic, filing for bankruptcy in December 2020. The following year, the retailer was acquired by TerraMar Capital, who together with Tiger Capital Group and SB360 Capital Group formed the entity that now owns the retailer, Francesca’s Acquisition LLC.
The sale of Richer Poorer will allow the smaller business, which began as a wholesale brand but pivoted toward e-commerce when the pandemic struck, to continue scaling and reach profitability, Pawling told BoF. This includes potentially opening Richer Poorer standalone stores down the road, she added.
“DTC brands are getting hammered right now,” Pawling said. “We wanted to attach ourselves to a larger mothership in order to share resources to allow us to grow profitable.”
Pawling and most of her team will maintain their operations as they previously had, including Richer Poorer’s creative director and head of sales. Its supply chain will also largely remain intact, except for its fulfilment capabilities, which are now integrated with that of Francesca’s. Under the retail chain, Pawling’s new title is president of wholesale, Richer Poorer, and Franki, Francesca’s girls and tweens vertical.
Francesca’s, known for affordably priced apparel and miscellaneous gifting products targeting young women, said the sale demonstrates its strength and financial growth after the bankruptcy. The retailer is planning to open around five new stores this year, while Franki, the tween concept, is slated to double its digital sales.
“Unlocking a wholesale channel is a huge opportunity for them,” said Pawling, pointing to Francesca’s stable of private label brands. “Us lending our hands to the Franki development too and overseeing brand development on that side is something we know how to do.”
