Monday, August 31, 2015

Kynetic's Fanatics raises $150M from Andreessen, Insight

Will add warehouses; implies $1.5 billion value for growing $800M (yearly sales) firm

Kynetic's Fanatics raises $150M from Andreessen, Insight

0 comments

Fanatics Inc., the $800 million (estimated 2012 sales) sports-apparel arm of Michael G. Rubin's Conshohocken-based online retail holding company Kynetic, says it has raised $150 million from venture investors Insight Venture Partners and Andreessen Horowitz, plus a $75 milllion line of credit for future expansion, in connection with its planned acquisition of Florida-based rival Dreams Inc., which closed today, Fanatics president Jamie Davis told me.

This sale of a 10 percent stake in Fanatics implies a value for the company of $1.5 billion.

Andreessen Horowitz is a venture capital firm created by Netscape co-founder Marc Andreessen and Opsware co-founder Ben Horowitz.

"We've invested a ton in our infrastructure, our technology and our investory," said Davis. Among other planned additions: new "fulfillment and regional distribution centers" in other parts of the U.S., added to Jacksonville-based Fanatics' existing Kentucky warehouse, which employs up to 3,000 during its pre-Christmas peak sales season. 

"Ecommerce is usually disruptive" to retailers, but Fanatics has been able to grow, Davis added, by supplying NFL, Major League Baseball, NBA, Nascar and other team-brand sports clothing, thorugh CBS, ESPN, NBC and other Web sports partners, to fans who have relocated far from their colleges or home-team cities and are typically unable to buy fan items in local shops.

As a result, "licensed sports is the only category that's growing because of the Internet," said Davis, a Chicago native who jonesed for Cubs gear during his years as a Comcast executive. He met Rubin at an NHL playoff game between his beloved Black Hawks and Comcast-Specacor's Flyers, leading him to the Fanatics post after a long, multinational TV management career.

"It's a hard business," Davis added. "We have to have something for everybody. We will keep, in peak times, over 1 million items in stock, with a retail value close to half a billion dollars. The Internet has made that available. And this is still in growth mode." 

0 comments
We encourage respectful comments but reserve the right to delete anything that doesn't contribute to an engaging dialogue.
Help us moderate this thread by flagging comments that violate our guidelines.

Comment policy:

Philly.com comments are intended to be civil, friendly conversations. Please treat other participants with respect and in a way that you would want to be treated. You are responsible for what you say. And please, stay on topic. If you see an objectionable post, please report it to us using the "Report Abuse" option.

Please note that comments are monitored by Philly.com staff. We reserve the right at all times to remove any information or materials that are unlawful, threatening, abusive, libelous, defamatory, obscene, vulgar, pornographic, profane, indecent or otherwise objectionable. Personal attacks, especially on other participants, are not permitted. We reserve the right to permanently block any user who violates these terms and conditions.

Additionally comments that are long, have multiple paragraph breaks, include code, or include hyperlinks may not be posted.

Read 0 comments
 
comments powered by Disqus
About this blog

PhillyDeals posts drafts, transcripts and updates of Joseph N. DiStefano's columns and stories about Philly-area business, which he's been writing since 1989.

DiStefano studied economics, history and a little engineering at Penn and taught writing at St. Joseph's. He has written thousands of columns and articles for the Inquirer, Bloomberg and other media, wrote the book Comcasted, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com, distefano251@gmail.com, 215.854.5194 or 302.652.2004.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
Also on Philly.com:
letter icon Newsletter