Key Takeaways
- Progetto 11 acquired Tomorrow Group, Three Hills Capital Partners.
- Sector: Consumer, Retail.
- Geography: United Kingdom, Italy.
Analysis
Italian holding company Progetto 11, the driving force behind the e-commerce fashion platform The Level Group, has finalized its acquisition of Tomorrow Group. This strategic move marks the exit of Three Hills Capital Partners and founder Stefano Martinetto from the London-based brand development and wholesale distribution firm. While financial specifics remain undisclosed, the transaction signals a significant shift in the independent fashion brand management sector.
Tomorrow Group, under the leadership of Stefano Martinetto, has been instrumental in nurturing and expanding the reach of influential designers such as Coperni, Martine Rose, and Charles Jeffrey Loverboy. With established showrooms in key fashion capitals like Milan, Paris, and New York, the company has also facilitated high-profile collaborations, including those with Marni, Diesel, and the notable Fear of God x Zegna partnership. This acquisition integrates a robust wholesale infrastructure with digital direct-to-consumer expertise.
The integration aims to leverage The Level Group's established e-commerce capabilities to enhance Tomorrow Group's operational framework. Andrea Ciccoli, co-founder of The Level Group, emphasized that the acquisition will ensure business continuity amidst what he described as a period of "wholesale disruptions and market challenges." He further stated that The Level Group's financial backing is intended to stabilize and propel the business forward, accelerating growth and broadening the brand portfolio.
This acquisition occurs against a backdrop of recent difficulties for Tomorrow Group. The company experienced a downturn in sales during 2024, alongside reported friction with some of its key designer partners. Notable instances include designer Martine Rose reportedly seeking to reclaim her brand's stake and Coperni's founders citing a strained relationship with Tomorrow Group as a reason for their absence from Paris Fashion Week. The firm had also recently divested its interests in A-Cold-Wall and the retailer Machine-A.
For Three Hills Capital Partners, their investment in Tomorrow London Ltd appears to have resulted in considerable losses upon exit. This outcome underscores the inherent risks and volatility within the fast-paced fashion industry, particularly for private equity firms navigating brand development and distribution models.
The consolidation of independent fashion entities is a continuing trend. Progetto 11's acquisition of Tomorrow Group exemplifies this, creating a potentially more vertically integrated fashion powerhouse. By merging Tomorrow's wholesale expertise with The Level Group's digital-native approach, the combined entity is positioned to offer a comprehensive solution for brands seeking to navigate both business-to-business and direct-to-consumer channels in a complex global market.