International sock brand
Happy Socks AB was a leading international brand of design socks. Founded in 2008 in Sweden by Mikael Söderlindh and Victor Tell, the Company’s mission is to spread happiness by turning an everyday essential into a colourful design piece with a high standard of quality, craftsmanship and creativity. Happy Socks has grown rapidly through a strategy based on high-impact displays at point-of-sale to as well as influencer marketing and user-generated content to drive consumer engagement, reinforced by collaborations with high profile designers and celebrity endorsements. It is today a globally recognised brand selling more than 20 million pairs of socks per year in 90 countries through more than 10,000 points of sale, supported by a fast-growing online channel and an expanding portfolio of mono-brand retail stores.
The investment builds upon Palamon’s ongoing thesis work in the specialty retail sector, identifying well-positioned European brands, in the affordable luxury segment, with proven global appeal. The global socks market is large and growing at c.4% per annum and is dominated by plain products. Happy Socks has disrupted the category with a “fun” product with a unique value proposition. Its differentiated product and attractive economics (margin, velocity and high replenishment) generates a high return on floor space for department and speciality apparel stores. Consequently, the company has sustained annual growth rates of 50% per year for the past 5 years as distributors have incrementally pulled more stock through their systems.
The company has the clear potential to continue its trajectory of sales growth of the core socks product line in underpenetrated and large markets such as Germany, UK, Japan and China. There is also the opportunity to drive growth across all markets through the introduction of new product lines and brand extensions.