“We are really focused on the luxury consumer and anything to do with the luxury lifestyle — not just fashion,” MadaLuxe chairman and cofounder Sandy Sholl told WWD.
Founded by Sholl and her son Adam Freede in 2010, the New York- and Los Angeles-based MadaLuxe started as a distributor of luxury goods to off-price retailers and luxury timepieces from Ferragamo, Versace and other designer brands to casinos, jewelry shops and stores such as Nordstrom, Neiman Marcus and Saks Fifth Avenue. The company opened a couple of its own off-price stores that were permanently closed during the pandemic.
Distribution remains the core of the business. Sholl prefers not to reveal any company financials.
However, in 2020, MadaLuxe formed MLG Ventures to invest in technology firms. MadaLuxe has investments in Psykhe AI, a platform that uses psychology-powered AI to personalize entire product categories by taking the user’s personality into account; Reflaunt, a business-to-business resale platform, and Codeboxx, a “boot camp” teaching coding and technology skills with a focus on women, people of color and veterans.
The company also set up a mergers and acquisitions arm, and two years ago hired Michael Hansen, formerly senior vice president of business development for Luxottica.
Just last month MadaLuxe acquired a majority stake in a six-year-old tequila brand called Enemigo. “We had been searching for two years for a tequila brand because as a family, we love tequila, and everybody in the company loves tequila. It’s a high-end spirit and Tequila Enemigo is really an extraordinary product.”
It’s also one that fits squarely into MadaLuxe’s luxury platform, Sholl added. Enemigo is currently sold in the U.S., Portugal and the U.K., will be available in Mexico and Guatemala by the end of this month, and is targeting other markets for expansion in Europe as well as the Middle East very soon, according to Sholl.
Last April, MadaLuxe struck a deal with Swedish luxury bedding company Hästens to open 20 Hästens stores across the United States in the next five to seven years. MadaLuxe will own the 20 stores as well as the merchandise, similar to franchises, but does not own the brand name.
“Coming out of COVID[-19], wellness was such a big, important priority so we saw this opportunity with Hästens on luxury mattresses and started thinking, if people spent $75,000 to $150,000 on their cars but you spend 33 percent of your time in your bed, why not invest in these handmade, handcrafted mattresses? Their mattresses go from about $25,000 to $500,000. They’re serious. So we took the distribution rights for several states and our first store opened in Dallas. It’s been very successful,” said Sholl.
MadaLuxe’s next move could very well be in retail. “We are looking at an acquisition in retail,” Sholl said, without being specific.
“MadaLuxe has really advanced to a tech-enabled luxury platform. That’s the best way to describe it,” Sholl explained. “And then with that, we have had an investment arm, MLG ventures, which does a lot of investment in technology. But we’ve also built internally a tech-enabled platform for the MadaLuxe Group.”
Regarding the distribution activities, “We represent the most iconic luxury brands in the world as a distribution platform in North America, and we’ve continued to grow that business,” Sholl said. “It’s still a big part of the business.”
Separate from MadaLuxe, Sholl said that this year she and Freede will launch an AI-powered virtual try-on and styling company called Zelig, which utilizes machine learning and computer vision. It’s expected to start operating later this year.
Sholl also discussed philanthropy, noting that the Sholl-Freede family foundation, called CommonTerra, has taken World of Children under its umbrella. World of Children is an organization that through donations awards millions of dollars to dozens of organizations helping vulnerable children around the world for more than 25 years.
“We’re putting a lot of focus on philanthropy,” Sholl said. “By using our success, and our voices for philanthropy, we work to be as impactful as we can.”