Julie Mathers, who sold her online retail business Flora & Fauna in 2021 for $27.9 million, has partnered with growth equity firm Arcus Partners to purchase babywear brand Snuggle Hunny Kids for an undisclosed fee.
Founded in 2016, Sydney-based Snuggle Hunny creates bespoke prints, turning them into contemporary baby swaddles, organic clothing, organic muslin wraps, nursery linen, bibs, milestone cards, and baby accessories made from organic, natural fibres and fabrics.
Mathers says she is proud and honoured to be the new custodian of the brand which is already stocked in more than 2,000 retailers across 60 countries, believing the business has a solid financial base in a market worth upwards of $3 billion a year in Australia alone.
“The marketing is good, the customer proposition is great, and what's important is that we've only just scratched the surface in terms of potential opportunities and growth,” Mathers told Business News Australia.
“We've only just gone into organic clothing, so there's lots more opportunity there with extending the categories. We’re also largely focused on Australia, so there’s an opportunity for growth there as well.
“It's a wonderful category and industry to get your head around. I have to be able to do something I enjoy, and this is an industry and business that I really enjoy, and it probably helps to have a three-year-old baby.”
Having built a relationship with Arcus Partners and its managing director and co-founder Daniel Hong over the last few years, Mathers is excited to partner with the team on the new venture.
“We started chatting when I owned Flora & Fauna, and we both got along very well, so when I looked at acquiring Snuggle Hunny, I reached out to Daniel as he and the team at Arcus are just quite different in terms of their investment approach,” said Mathers, who has been appointed CEO of Snuggle Hunny.
“It's very much a patient investment approach, they look at the long term and not just tomorrow, and I like that style. They're also very good to work with in terms of being very commercial, crazy smart people, and really good at bouncing ideas off.
“There's some retail background and consumer goods background as well within the people who work there, so when I reached out to Daniel and told him this was a great business - a couple of months later and we were doing the deal.”
Arcus Partners managing director and co-founder Daniel Hong said Snuggle Hunny and Mathers underlines its approach to investing in high-quality, profitable businesses with multiple growth opportunities led by an outstanding and entrepreneurial leader.
“Julie is the right person to lead the company in the next phase of growth, given her strong track record of building brands and expanding businesses. We have been long admirers of her leadership of Flora & Fauna and as an industry thought leader and are excited to partner with her in the years to come,” he added.
Mathers founded Flora & Fauna, a retail platform focused on vegan, ethical and sustainable products, in 2014. The initial plan was for her to stay at the business after selling it; however, it soon became apparent that it wouldn’t work.
“I'm massively re-energised actually, I love running businesses, and I love getting into the weeds and finding solutions to problems,” she said.
“We've got a small but incredibly dedicated team here, a very passionate group of experienced people, and it's great fun working with them.
"For me, working with a really good team is what really excites me. We're working together every day, and it’s almost a startup mentality with us – so it's good fun.”
In the short to medium term, Mathers will focus on building the team, strengthening the foundations, enhancing the customer experience, and incorporating sustainability into everything the business does.
She plans to expand the current range for spring and summer and has brought in a buying manager to help with that process. Also joining the executive management is COO Tom Abraham, who has had a great working relationship with Mathers at Flora & Fauna.
Having come in fresh to an established business, Mathers has spent time understanding the culture, which involved listening to staff, retailers and customers.
“I talked to the team and said it's an evolution, not a revolution, and we're evolving the brand. We've been spending quite a bit of time really understanding who we are as a brand, our purpose, and our values,” she said.
“Although it's an established brand, there's still work to be done in terms of nutting it out, which I think happens a lot of the time with small businesses that have started growing quite quickly.
“There's still work to be done there, too, but it's important to take stock and think ‘Who are we’ and ‘Who do we want to be going forward’, and it's been great for us to work through that.”
Snuggle Hunny has published a commitment on its website to sustainability, which chimes with Mathers' belief in building better businesses with better practices.
She is hoping to change all Snuggle Hunny fabrics to be either organic or recycled within the space of a year and is planning to make all packaging plastic free.
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