Quadrivio Group to launch a 500 million fund

«By the end of the year we will launch the Made in Italy 2 fund. Compared to the first one, we have almost doubled the collection target to 500 million». Alessandro Binello, ceo at Quadrivio group, chose MFF to anticipate the new vision of a private equity firm aiming to speed up the growth of Italian companies with potential for global expansion. «We are acquiring a lot, in the coming months we will enhance two of our brands, listing one of them on the stock exchange». The manager gained relevance with the purchase of Gcds (see MFF of January 7, 2021), taking over, through the Made in Italy fund, the majority of the brand (see MFF of November 13, 2020), founded in 2015 by the brothers Giuliano and Giordano Calza. The Made in Italy 1 fund, with a capital collection target of 300 million, closed in 2021 two years ahead of schedule and with six portfolio companies —among which Dondup is standing out. No comment on a possible interest in Chiara Ferragni collection, for which Binello's name has been called into question (see MFF of January 29).

Do you want to become a new key player for Italian fashion? With Made in Italy Fund 1 did you make six fashion acquisitions?

The idea is to focus on fashion, as well as design and beauty, proved by the fact that, out of 13 acquisitions, six are on fashion and they are the major ones. With Made in Italy 1 the collection target was 300 million and we closed it in 2021, after launching it two and a half years ago, in March 2018. Made in Italy 2 will be launched by the end of the year and we will enhance two companies before the launch, by listing one on the Stock exchange and by looking for a new partner for the other.

Will the IPO be on the Milan Stock exchange or elsewhere?

On the Milan Stock exchange. Moreover, we are still investing. We are looking particularly at two other fashion companies and the portfolio is giving us a lot of satisfaction. What we want to do is to make the companies international. We are doing that with Gcds, which is planning important store openings in Asia every year, in addition to those in Europe. We have opened three stores in this period, two in Shanghai and one in Beijing, and we will open more. Our main goal is still to be industrial partners of the brands we acquire.

Besides Gcds, which other brands of yours are doing well?

Dondup is a company that is doing very well, by recording very important numbers and is proving to be profitable, with 15-17 million EBTDA and 56-57 million euros of revenues. Autry (sneakers brand, ed.) is also recording very similar numbers to Golden Goose in the first round... We are generally satisfied and we expect it to largely increase its revenues this year.

When will you be launching Made in Italy 2?

The launch will certainly happen sometimes during 2022, most likely in the second half of the year or between June and September, and the plan is to develop it immediately. Investors are happy because Made in Italy 1 is doing well, since the value of the fund today is much higher than what they paid in, with values around +30%. However, we still have part of Made in Italy 1 to invest in, closing these acquisitions in the first half of the year and launching the fund, if we are good enough, at the beginning of June.

These are segments that do not overlap. Dondup with denim, Autry with sneakers and Gcds with its great view. For example, it invested in virtual reality two or three years ago, with a Metaverso ante litteram.

Yes, it is true. Now we are working on the unload on the ground. We have created an important structure, thanks to the entry of experienced people coming from important companies. We employed a merchandiser from Moncler, a commercial director from Virgil Abloh's group. Today we have to unload this pioneering communication by the Calza brothers, Giuliano and Giordano, on the ground.

What kind of response is coming from the market? And what vision do you cultivate?

Certainly, the reason we are increasing Fund 2 to half a billion is that we have grown in visibility. We want to focus on companies that already have an excellent brand, or a product linked to a brand, for which it is worth developing it internationally, or that have a very clear lifestyle and are characterized by an Italian taste.

What added value do you bring to it?

What emerges in most of the realities that we acquire is the lack of structure. This is why we are strengthening our competencies at a strategic level. The areas in which our brands are currently weakest are internationalization and digital. In Italy, digital is not yet so widespread, while abroad there are companies whose digital revenues are already at 30-40%.

How have these two years of pandemic changed the market? In your opinion, have they favoured the focus and acquisitions in the Made-in-Italy brand?

In these last years, three phenomena have accelerated: international presence, digital transformation and management. In our opinion, financing is not enough, but it is also necessary to encourage concrete aspects, being able to count on an important support network. The first move to make is to increase a company’s turnover from 20-30 million to 100, and it is precisely what we are focusing on for many of the realities in our portfolio. This is as important a step as it is time-consuming in terms of the time you spend at the company but, in the end, it makes all the difference. This is the real advantage of private equity, if you do it in an industrial way. (All rights reserved)