Badgley Mischka: Back to Business

NEW YORK — Mark Badgley and James Mischka spent last September's fashion week squirreled away in their Hamptons house, fielding phone calls from prospective buyers.

"We left New York. It was too depressing," Badgley said during an interview at the designers' temporary showroom space at 215 West 40th Street. "It was a very strange feeling not having a show. We didn't want to be around."

Fast-forward to today and it's clear the pair is now running on all cylinders. More than 700 Badgley Mischka followers are expected at its Wednesday night runway show at The Waterfront. The company is tripling its show budget compared with previous shows and hopes to show off the major star who will appear in the brand's first national ad campaign next season. No one would ever describe their frocks as understated and this spring is no exception. Marion Davies and William Randolph Hearst's high-flying days at the 115-room Hearst Castle in San Simeon, Calif., provided a healthy dollop of inspiration.

Clearly the company has weathered its share of changes since Candie's Inc., which has since switched its name to the Iconix Brand Group, acquired it in November.

Badgley said, "We wanted to do a small typical fashion show during the day, and [Iconix chairman and chief executive officer] Neil [Cole] said, 'No, this should be a celebration. Let's do a big, gorgeous fashion show at night and have a party afterwards.'"

Say no more.

Badgley Mischka was forced to sit out the spring 2005 season, after its former parent company, Escada USA, was saddled with financial problems and put the U.S. designer house on the block. But Badgley Mischka made good on its vow to be back in business with a fall 2005 collection. Candie's made that happen, by buying B.E.M. Enterprises Ltd., the holding company for the Badgley Mischka business, last year from Escada USA, which had owned the brand since 1992. This fall Candie's changed its name to Iconix.

Looking back, something the designers only do when asked to, Badgley said, "Perhaps we should have made this change earlier than we did. That is something that we all would agree on."

In a telephone interview, Cole said, "I always thought they made the most beautiful dresses out there. I looked at it like an uncut diamond. They didn't have anything beyond their couture dress business. This was the perfect opportunity to build a phenomenal luxury business and to diversify Iconix, which until then had been largely thought of as a junior business."

Badgley Mischka is on its way to becoming a $100 million annual business by 2009. With eight licenses in place, the company expects to generate $30 million in sales in 2006 — well above the $20 million business it was at its peak with Escada, Cole said.

Under the old regime, Escada was priority number one, and as a result, Badgley Mischka fell short of its plans to line up a licensing portfolio. "The focus really was on Escada. At the time, they were in such financial difficulties themselves," Mischka said.

Badgley finished the thought, as they often instinctively do for each other without interrupting or the slightest gesture for help. "We had a nice long run with them, but we needed a parent company where we would be the focus and priority," he said.

As soon as Candie's stepped in to the rescue, some eyebrows were raised that a company known for its racy Jenny McCarthy ads was buying a well-known designer brand. But the designers said they were drawn to Cole's enthusiasm, entrepreneurial spirit and non-Seventh Avenue mentality. Instead of "Sell, sell, sell," he advised them to reposition the company as a licensing and marketing one instead of a manufacturing entity. "It wasn't a matter of doing the same old thing with someone else's money," Mischka said.

Cole has also been instrumental in helping them "sniff out" strong licensing partners. First up was Groupe JS International, the manufacturer that is producing Badgley Mischka couture and eveningwear. Bridge and designer sportswear collections are planned for spring 2007, but details are still being ironed out.

Next month, Badgley Mischka relocates to a showroom at 550 Seventh Avenue, the only address on Seventh Avenue they were interested in occupying. That's a real milestone for their 17-year-old business, so much so that it is hard to imagine them as the struggling Parsons School of Design students they once were. Before going out on their own, Badgley spent two years at Donna Karan and Mischka did the same at Willy Smith, where the designer's limo was always at the ready parked at the loading dock.

At the new showroom at 550 Seventh Avenue, there will be plenty of Badgley Mischka designs to fill the space. The duo also has licenses for daytime and evening handbags, eyewear, furs, bridal, fragrance and accessories. Eyewear will hit the stores in December and fragrance will follow for spring. Freestanding stores are also in the works through a licensing deal with Pristine Fashion Group.

Badgley Mischka has reopened its Beverly Hills boutique and plans to unveil another in Palm Desert in late November or early December. There is also an aggressive search for sites in Manhattan, Bal Harbour, Palm Beach, Houston, Washington, D.C. and Las Vegas. The designers are eager to put forward the whole Badgley Mischka aesthetic, which extends beyond their easily identified, elegant evening dresses. Lining up a smattering of stores across the country should do just that, Badgley said. "Stores can be much more successful, when they have more lifestyle products."

There should be even more products to choose from before too long. Talks are under way to secure licenses for diamond jewelry, lingerie, home and shoes before the end of the year, they said.

Rehiring 35 employees, who lost their jobs when the company disbanded last year, and returning to factories that produced previous collections were crucial elements of re-creating the brand's authenticity, they said.

More than anything, the Iconix deal has freed them up from number-crunching and other business tasks to allow them to be more creative. "Just having the support and backup makes us not have to worry about watching our backs so much. Plus, I can watch Mark's and he can watch mine," Mischka said.

The truth is that work is always a top priority for them. "It's all we talk about morning, noon and night. I would like to tell you something different," Badgley said.

No surprise most of their conversation these days centers on Wednesday night's show, which will be held in the renovated space that used to be the nightclub The Tunnel.

"They call it The Waterfront now. It sounds better. A lot of people have a history with The Tunnel, which they do or do not remember," Mischka mused.

Regardless of their memory capacity, guests will enter through the site's back door. "The front entrance was too fancy for us," Badgley said.

For now, Iconix is busy readying for the first national Badgley Mischka advertising campaign, which makes its debut this coming spring. Details about the in-house multimillion-dollar effort are still being sorted out, but print, outdoor and multimedia components are expected to be included. "We like outdoor. We had a billboard in Hollywood once that we loved," Mischka said.

Apparently, Hollywood starlets share that admiration. In recent months, a steady stream of celebrities and stylists have come knocking, but the designers declined to name any due to the surprise factor and competitiveness of suiting up stars for red-carpet events. But when Badgley demurred with, "Everyone is being really supportive," Iconix's public relations director, Maria Dolgetta, interjected. "They're being modest. We have had so many requests from celebrities," rolling her eyes at the thought.

Their friend Cornelia Guest is another one of their biggest supporters and is eager to see their daytime clothes. She met them at their first fashion show at the Bel Air Hotel years ago, quickly befriended them and rides horses regularly with Badgley, an accomplished equestrian. (He finished third in this year's Hamptons Classic.)

"They make really beautiful classic clothes. There aren't many people left who really do that. They are also so consistent — they never go off on a tangent. And you don't have to be a coat hanger to wear their clothes."

Even with their show a week away, the designers are low-key to the point of seeming downright calm. "We're nervous," Mischka allowed.

Whatever the task at hand, they said they relish any comic relief. "There's a lot of anxiety. But we try to have fun throughout the process, because at the end of the day, this is what we do," Badgley said.