Why One LA-Based Denim Brand Is Inviting Fans to Be Investors

Yahoo Style Staff
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Have you ever dreamed of becoming a fashion mogul?

Denim brand DSTLD wants to make it possible. Sort of. The Los Angeles-based company, which launched in 2014, previously raised $4 million via traditional avenues: friends and family and venture capitalists. But this month, DSTLD signed on to SeedInvest, a platform that lets any “normal” person invest in a company.

The type of investment is called equity crowdfunding, and it was only made legal in the US in June 2015 after the implementation of Regulation A+, which allows private companies to raise up to $50 million from the public. In the past, only individuals who made more than $200,000 a year or had $1 million in assets—not including the house they live in—could invest in companies. Now, anyone can.

Currently, you can log onto SeedInvest to “indicate” that you’re interested in investing $1,000 or more in DSTLD. “Indicating interest” means that no firm commitment is being made and no money is being exchanged. It’s just a “Hey, I would be up for this” statement. “An indication of interest is non-binding and involves no obligation or commitment of any kind,” the website explains.

As of the morning of September 28, 2015, DSTLD had received more than $7.6 million in indicated interest. If the company does indeed decide to raise money from the general public, the transaction will have to be approved by the Securities and Exchange Commission (SEC), which could take a while. However, DSTLD co-founder Mark Lynn says he’s excited by the prospect of regular folk having a stake in the label. “This allows your customers to participate in your brand story in a profound way,” he explains. And unlike crowdfunding platforms such as Kickstarter, those who participate aren’t just receiving good will or a product in exchange for their money. If DSTLD is someday sold, individuals could actually see a return on their investment.

So, what makes this particular brand worthy of your cash? DSTLD’s elevator pitch is that it delivers luxury basics and jeans for a fraction of the price you’d pay at a traditional retailer. Because DSTLD sells directly to the consumer through its e-commerce website, it can keep costs down. For example, a pair of the line’s $65, high-waisted skinny jeans would typically retail for $180. If you like DSTLD and what it stands for, it might be worth checking out SeedInvest.