Moneybags: humble British satchel conquers the world
Julie Deane set up her business at home with £600. Now she has raised $21m to help sell her bags worldwide
Friday 24 January 2014
The Cambridge Satchel Company has raised $21m (£12.7m) to break into China and “train up the next generation” of British craftsmen – only five years after it was founded by a mother of two in her kitchen.
Julie Deane and her mother Freda Thomas founded the company in their Cambridgeshire home in 2008 with a budget of only £600. Deane, a former chartered accountant, was reading her children the Harry Potter books at the time and couldn’t find good quality satchels like the one owned by Harry.
Cambridge Satchel Company has grown rapidly since its modest start thanks to its popularity among celebrities and fashion designers. Model Alexa Chung and singer Rita Ora are fans of the company’s colourful signature leather bags, which sell for £108.
The satchels have also appeared in hit TV shows, including Girls and Gossip Girl. The brand has collaborated with fashion label Comme des Garçons and last October brought out a line designed by Vivienne Westwood.
The explosive growth means the company is on track to turn over more than £15m this year and London-based venture capital firm Index Ventures is investing $21m (£12.7m) to help fuel the expansion.
Deane, 47, said the investment would allow the firm to double the staff at its Leicester factory from 50 to 100 within the next 12 months, as well as expand the company’s apprenticeship programme.
“The most skilled people are approaching retirement so before those skills are lost we need to train up the next generation,” Deane said.
All the company’s bags are handmade in the UK and Deane was involved in finishing products during the Christmas rush.
Deane, who has been in talks with potential investors for two years, said Index Ventures’ digital expertise was a key to the deal. Index traditionally backs technology businesses and is an investor in online fashion retailers ASOS and Net-a-Porter.
“Online growth is the backbone of the business. I started this with just a website,” Deane said. The minority stake Index has taken is the first outside investment in the bag maker.
As well as growing its manufacturing base, the business plans to expand its presence overseas, targeting the US and China. “Customers from China come when they visit London. They know the brand and they seek the stores out – I know the demand is there,” Deane said.
David Cameron invited Deane to accompany him on a trade mission to China last month alongside representatives from firms such as Rolls-Royce and BP. She credits the trip with giving her the confidence to tackle the market. “Before that visit, the Chinese market seemed so complicated. I feel now we understand how to do it properly.”
The company’s bags are already stocked in the New York department stores Bloomingdale’s and Saks Fifth Avenue.
Giuseppe Zocco, co-founder and partner at Index Ventures, called Cambridge Satchel Company “one of Europe’s most exciting entrepreneurial stories”.
He said: “With vision and determination, Julie turned a boot-strapped company, born without resources or support, into one that is so fearlessly taking on the world.”
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