Back to Investments Overview

The Rug Company

The Rug Company

Invested:
November 2015

Sector:
Leisure and Retail

Headquarters:
London, United Kingdom

Region:
Global

Business:
Luxury Rug Retailer

< back to portfolio overview

Business at time of investment

The Rug Company is a leading global brand in contemporary designer rugs with an established international sales presence through 10 own showrooms and a number of franchisees and concessions worldwide. The Company is the market leader in the UK, has developed a solid position in the US, and has successfully entered Germany in late 2014.

Founded in 1997 by Christopher and Suzanne Sharp, the Company sells high-quality, contemporary rugs, serving interior designers as well as high-end retail customers.  The Company has built a strong reputation for design, based on its own in-house collection and through ranges developed in collaboration with iconic designers such as Alexander McQueen, Diane von Furstenberg, Kelly Wearstler, Paul Smith and Vivienne Westwood.

Investment rationale

The investment The Rug Company stemmed from Palamon’s ongoing thesis work into the favourable growth dynamics of the affordable luxury retail segment.  There is an opportunity for well-positioned European brands to rapidly accelerate growth in a global market and in particular those which meet the increasing consumer demand for quality and artisanal craftsmanship. The Rug Company is an attractive opportunity to back a high-quality brand and product platform in the £3 billion global luxury and affordable luxury rug market, which grows at 4 – 5%.  Within this segment, design-led contemporary rugs are gaining share from more traditional designs.  The Rug Company is the global leader in this segment, which puts it in a position to significantly outperform competitors.  The luxury rug market today is highly fragmented and TRC can leverage its position to gain market share by displacing smaller local players, as well as to grow the overall market by displacing other types of floor covering.

Value creation

  • Appointed highly experienced team:
    • James Seuss as CEO (ex CEO of Hunter Boot Limited, Tourneau and Stella McCartney)
    • Marty Wikstrom as board member (ex CEO of Harrods and Richemont Fashion)
    • Tord Dyrssen as board member (President Wholesale Ralph Lauren and ex CEO Ermenegildo Zegna)
    • Alessandro Strati as CFO (former CFO of Moleskine)
  • Roll out new showrooms in the US and DACH
  • Build wholesale, retail and franchise partnerships globally