High design is going digital.
(Bloomberg) — A day after furniture fair Design Miami/ opened its first Paris edition to VIPs, organizers announced that the fair has been acquired by Basic.Space, a digital marketplace best known as a space where notable creatives sell everything from vintage clothes to limited-edition collectibles. The transaction is an all-stock deal; the fair’s valuation wasn’t disclosed.
“What attracted me to this deal was that we’re going more and more into the design space,” says Basic Space Inc. founder and Chief Executive Officer Jesse Lee.
Started in 2019 as a place to sell preowned lifestyle products, the site, Lee says, quickly added new releases and brand collaborations to its roster. Today users can buy clothes from fashion consultant Nick Wooster’s closet (a white Comme des Garcons blazer: $480), a new rose-gold-plated doorstop from the tiny cult brand Secret of Manna ($1,060) or an (also new) 50-gram jar of exfoliator from Isla Beauty ($58.) “It felt like the right synergistic partnership, where then we can leverage their name and reputation in the design space, and then leverage that for us to capture more supply, more partnership opportunities with the design brands, and expand our offering to our customers,” Lee says.
Basic.Space, in other words, has the e-commerce platform and the users; Design Miami/, which also has annual events in Basel, Switzerland, and Miami that coincide with the Art Basel art fairs, has the cachet. Currently, the fair is a showcase for super-high-end design. Major dealers including Carpenters Workshop Gallery, Galerie Mitterrand, Adrian Sassoon and Friedman Benda have exhibited at the fair, showcasing new and used couches, desks, chairs and objet d’art that can easily cost more than $100,000 apiece.
On the VIP day of Design Miami/’s inaugural Paris edition (Oct. 17-22), a well-behaved crowd of attendees draped in quiet luxury, many of whom spoke English with an American accent, threaded their way through tableaus of contemporary and historical design. The fair is located in the exquisite 18th-century hôtel particulier known as the Hôtel de Maisons. Dealers installed their wares in vignettes, complimented by the mansion’s glittering chandeliers and ornate boiserie.
“The design market is here to stay, and it’s going to keep growing,” says Zesty Meyers, the co-founder of the design gallery R & Co., standing inside a room filled with work he’d shipped from New York. “Design Miami/ is the catalyst for the global collectability of design.”
And yet, perhaps unsurprisingly given the price of its wares, the fair hasn’t successfully broken into e-commerce. “Two or three years ago, we decided we wanted to create a digital platform,” says Design Miami/ founder and former majority shareholder Craig Robins, who started the fair in 2005. “And what we found was that there’s a lot of potential in that, but we weren’t really able to get it right.” (Design Miami/ still has an online sales platform, where things like $50,000 chairs are on offer.) Robins, who was an early investor in Basic.Space, says it then occurred to him “that the combination of Design Miami/ and Basic.Space could be very powerful.”
Long Runway
There are other overlaps between the two companies. The venture capital firm Valor Equity Partners is an investor in both. Design Miami/ and Basic.Space also employ unconventional punctuation marks in their names.
Lee, for his part, is sitting on a sizable amount of cash: Basic.Space raised $8 million in 2021 and an additional $15 million in 2022. “We were cash-flow-positive within the first year, so investors have wanted to participate,” Lee says. “So we raised money because we could, and that Series A actually ended up being really prescient for us, because now we have runway.”
He’s acquired majority shares of two smaller brands already: Aquatic Leisure Center, which predominantly sells baseball caps that are a hit with celebrities like Justin Bieber and Gigi Hadid, and Period Correct, an “automotive lifestyle company” that organizes car meets and sells car-branded apparel.
These acquisitions have helped expand his site’s range of offerings, Lee says, even as the overall collectible market has tapered off. “The main reason why we’re able to steadily grow is because we expanded the supply side with the sellers,” he explains. “But frankly, what that also does is dilute the quality, or the price of the products.” That, he continues, has been a reasonable tradeoff. “We saw, and based on data, too, that people are spending less money on expensive things. So it made sense to open it up more and have more product offerings for our users.” As a result, Lee says that his company’s sales, revenue and customer acquisition have continued to grow.
Mass Market
It’s an approach that Lee says he’ll bring to Design Miami/ as he extends its online footprint.
“The strategy going into 2024 is about extending categories,” he says. “So it’s not just ‘design and furniture’ and really high-price, high-ticket items, but making [the strategy] a bit more youth-centric and open to millennial and older Gen Zs with disposable income.” He cites a release that Basic.Space did in 2020 with the late designer Virgil Abloh, who’d collaborated with the furniture brand Vitra. “The chair was like $2,800, the lamp was $1,800,” he says. “These are more affordable, but it’s still Vitra and Virgil Abloh.” And so, he continues, “what we want to do is create opportunities in product lines and collaborations, whether it’s in furniture or other things like watches, speakers or whatever, that actually fit at the right price point. And then we can make it more accessible to a younger audience.”
Robins says the model already exists: “No one’s going to argue that it doesn’t happen with sneakers and fashion,” he says. “As design becomes less expensive and more available, but still feels very limited, I think that there is potential there.”
But there’s a balance that needs to be struck between accessible prices and an aura of desirability, Robins continues. “We’ve seen how so many people have tried to do this, and not been really successful,” he says. “It’s probably because they’re commoditizing it more and not keeping that special factor.”
This (comparatively) mass approach to the e-commerce component of Design Miami/ will be of particular import in the face of the broader luxury market’s brisk headwinds. Whereas a mere year ago leaders in the luxury resale space were concerned about sourcing enough supply to meet demand, today demand for everything from handbags to watches has slumped: The Bloomberg Subdial Watch Index, for instance, has dropped 12% in a year.
Lee says that design is a category that’s well-positioned to weather any downturn. “With fashion and sneakers there’s less brand loyalty, like you don’t love Balenciaga forever—you like it for a season,” he says. “But my friends who collect Jean Prouvé chairs love them for 30 years. If you love Porsche, you only buy Porsches for 30 years,” he continues. “I think it’s actually a more sustainable business model.”
Further Expansion
Another strategy, Lee continues, will be expanding the physical fair into other cities. “Basel, Switzerland’s an amazing city, but most people under 40 are never going to go to Basel—they’ll go to Paris,” he says. “You could make a case that there are other international cities, and even domestic cities, where Design Miami/ could make more sense.”
All of this, Lee stresses, is conditional: The deal was only inked the day the Paris fair opened to VIPs.
There will probably be a different Design Miami/ app; there is also an ongoing question about how Basic.Space and Design Miami/’s brand identities will (or will not) merge.
“Going into 2024, we’re going to be very aggressive in terms of making decisions,” Lee says. “I’d say it’s safe to assume that there will be a new city we show up in, either domestically or internationally,” he adds. “And then we need to expand categories beyond the high-end traditional furniture, or whatever you want to call it. That’s going to have to happen concurrently in 2024, so we have more participants and attendees and interested parties.”
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