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Stylemaker / Hoping for a new beginning

Refashioning Mossimo

Recently, designer Mossimo Giannulli's career has been a roller-coaster ride. Now, with a new team and a strategy, he hopes to climb his way back to the top

May 21, 1999|VALLI HERMAN-COHEN | TIMES SENIOR FASHION WRITER

At first glance, everything about his appearance says he's a relaxed California kind of guy: the golden tan from leisurely beach days, the slip-on sandals, the ease of his casual pullover and sleek pants.

But the silver hairs sprouting around the temples of 35-year-old Mossimo Giannulli show the strain of having it all, nearly losing it all and now, trying to get it back.

"To go from a garage to a public company and then to fall flat on your ass--that's a hard thing for a guy of 33, 34. I was challenged with so many more things than a typical 33-year-old," says the chairman and creative director of Mossimo Inc., the beleaguered Irvine-based contemporary sportswear company.

His fall came quickly.

Starting with simple volleyball shorts, in a decade he built a $108-million sportswear enterprise. In 1996, Giannulli took his company public. Soon after, Mossimo stock soared to $50 a share and Giannulli, a college dropout, was, at 32, the youngest chief executive on the New York Stock Exchange.

But within two years, sales plummeted, profit disappeared and the stock price dropped to $1 a share as he stumbled launching upscale menswear and women's-wear. Production and delivery problems hurt sales, credibility and Giannulli's nearly half-billion-dollar fortune.

By 1998, Giannulli cut his $500,000 salary to $315,000 and took a new title, "visionary." He hired for a year turnaround specialist John Brinko, who closed some businesses, slashed jobs and moved the company out of its fancy headquarters. The company is still operating in the red.

Now the designer is attempting a big comeback and betting heavily on winning. In December, Giannulli gave more than half of his 10.4 million shares of Mossimo stock to the company's new chief executive, Edwin Lewis.

The former chairman and chief executive of Tommy Hilfiger and past president of Ralph Lauren Womenswear has brought in a group of retail heavy-hitters who helped build the Lauren and Hilfiger empires.

Their goal: Make Mossimo "the next great American brand," with the hope that shoppers will soon have the same one-name familiarity with Mossimo that they do with Ralph, Calvin, Tommy and Donna.

Their challenge: to improve production, product and most important, the Mossimo image.

At Thursday's annual meeting, Giannulli and Lewis made their original handshake agreement official: Neither man would take a salary this year, and their ownership would be split, with Lewis having stock options that equal 36.2% of the company, while Giannulli's stake is 34.5%.

"He's worth it. Divide and conquer," Giannulli says.

The carefree optimism that characterized Giannulli's early years as a hot-shot beachwear designer has been replaced by a steely intensity earned by hard business lessons.

"It hurt a lot," says Giannulli, sitting on a low bench inside his Mossimo Supply store at South Coast Plaza. "My whole crew was quitting out from under me. All of a sudden, I was manning the ship by myself--I was a public company! It would have been easy for me to sell out. But I don't think it would have been fair to my shareholders, to my family or to myself.

"I couldn't quit," he says, with a tone of defiance and pride. "And my friggin' name is on it."

The tough years coincided with a happier personal life, however, when the divorced Giannulli married actress Lori Loughlin in 1997. The couple, who are expecting their second child, still live well in a million-dollar Bel-Air mansion.

With Lewis, Giannulli says he now understands what went wrong and the value of failing.

"Nothing pained me like that time I went through," he says. "Had I not reached those depths, I'd have never met Edwin. I'd have been so friggin' cocky, I'd never have listened. Now I'm a better husband for it. I'm a better businessman for it. I'm a better father for it. You understand how to face challenges."

*

Under the direction of Lewis, he's discarded some notions and practices that he once held dear. For instance, he once said his collection wouldn't include anything that wouldn't hang in his closet.

"That's something I learned from Edwin. It doesn't necessarily have to be in my closet. It would be a pretty small closet," he admits.

The new team also is changing the look of the stores, the depth of selection in them, and helping Giannulli return to his design roots.

"All I worry about is marketing and product," he says of his new job responsibilities.

The new line of men's and women's sportswear that will arrive in stores this fall looks more like the early Mossimo. It's edgier, trendier, more sophisticated Californian and less skater kid. There's an innovative brushed nylon that looks and feels like washed cotton; lavender, silver, white and black--colors that parallel current fashion trends. And in the cleanness of the silhouettes, the clever treatment of a collar, a pocket or a seam, there's that Mossimo passion to be on top of what's hot.

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