2 500 € (2%)
of 150 000 - 300 000 € goal funded
250 € minimum investment
Estie OÜ is a fast growing company based on Estonian capital, which believes that it is possible to successfully bring the first all-in-all luxury clothing brand from Estonia to the world. The brand is created for people with above-average incomes who appreciate the quality, Nordic design and lifestyle that accompanies the image created by the brand.
Nearly 20% of the world's luxury class needs are unmet. In doing so, we have targeted markets estimated at EUR 21.3 billion. We create a modern fashion house that would not only be a clothing brand, but would also focus on innovative sales, exclusivity and the addition of IT technology in the old-school retail trade.
ÉSTIE products have been resold in England, the USA, Finland and Estonia. Through us, the products have reached customers from Germany to the United Arab Emirates. Our goal is to be immediately confirmed in foreign markets, and certainly at strategic points such as Sweden, Norway and Hong Kong. Sales in these countries have already begun through sales agents. ÉSTIE is also a registered trademark in both Europe and Hong Kong.
We will be improving ÉSTIE's product portfolio already this year with a backpack, hand luggage suitcase and perfume. These are products that are missing from the Scandinavian luxury market. Nevertheless, we also consider it important to develop existing products and enter the market with an updated collection. Already in the last quarter of next year, we plan to enter the market with the first limited edition clothing collection of ÉSTIE, which we sell only in selected retail outlets - ÉSTIE e-store, Brage store, Nordic and Asian boutiques. At the same time, we also produce the first samples of the clothing collection for B2B customers, which can be ordered in advance for 2022.
The raised capital will help us to enter the market with ÉSTIE's new product range (backpack, hand luggage case and perfume) and to develop a new collection selection in cooperation with ÉSTIE's chief designer. We can also use the raised capital to replenish stocks for the Brage by ÉSTIE store, increase marketing volumes, use specialists to enter foreign markets and develop the ÉSTIE online store.
Problem & Solution
We all know by name so many world-famous fashion brands. Louis Vuitton, Hermes, Chanel, Versace, Gucci or Prada definitely came to mind. What do all these brands have in common? That's right, they all come from Western Europe. Hence the problem - the world's leading clothing brands come from France or Italy, based on an enchanting renaissance in their design, taking into account the weather conditions there. Unfortunately, about 20% of the world's luxury class needs are not met. When the warm weather in France starts in April, Scandinavians can often only wear swimwear in August. In August, however, the brands no longer have anything to offer, as they prepare for the autumn and winter seasons.
The Asian market draws inspiration from the US hip-hop era, which has also been transferred to premium and luxury products (hashtags and large images on products). Due to the growing awareness of the Nordic countries in Asia, the interest of the people there in Northern European clothing products is also growing. This fact is proved by the success stories of Ecco, Marimekko and J. Lindeberg in Asia.
"People around the world are increasingly interested in Scandinavian design, more than ever before," says Tine Kjølsen, special adviser to the Rector of the Danish School of Design in Copenhagen, highlighting success stories from Nordic brands such as Acne and Sandqvist in Asia. There (Asia) there has also been an interest in product stories - where they come from and how they are made - which fit in very well with Scandinavian traditions. ”(Financial Times, 2012)
Sources of Asian demand for Northern European products and services:
"A taste of all things Nordic" Financial Times (The full text of the article is available under the Documents-tab.)
As a solution, we see that the fashion created by ÉSTIE should be practical on the one hand, but also speak to the people of Northern Europe and Asia in design on the other. In doing so, we have targeted markets estimated at EUR 21.3 billion.
As we have received daily feedback as a result of our activities so far, we know what the Nordic people value and what they really want. We can take the strengths of resellable brands and develop their bottlenecks to suit our customer base. Already today, there are contacts in factories where we can offer outerwear that better meets market needs.
We also know the obsessions of resellable brands that make them unable or unwilling to produce products that would actually make up a large portion of sales revenue. We are here to take the benefits of these products from both the brands that we represent and the world-famous brands in order to take them to the next level.
We want to fill the market with precisely those products inspired by Scandinavian design, which reflect honesty, modesty and good quality, without being too bright or screaming, as is the case with Italian design, for example.
EXAMPLE OF ÉSTIE PRODUCT DEVELOPMENT:
ÉSTIE BRAND STORY
It all started already in the 13th century with Reval (today's Tallinn), when simpler leather shoes and consumer goods were produced here. We consider ÉSTIE to origin from the 15th century, when the leather work of our region was in its prime. Reval's leather products were exported throughout the Hanseatic League (Scandinavia, northern Germany, the Netherlands and Livonia) and since then high-quality leather work has been intertwined with our people, inspired hundreds of years later.
The brand was named ÉSTIE due to the pronunciation of its Estonian national name and the French writing style, which opens the door to compete with world-famous brands. The first collection was inspired by modern architecture and the high-quality carbon fiber material used in sports cars, interwoven with leatherwork that began in the 13th century. All production and the birth of the brand took place on Müürivahe Street, which was used by aristocrats for everyday affairs during the highlights of our region's leather work. This is also the reason for ÉSTIE's target group - the high-end class.
In its early years, ÉSTIE was known as a brand aimed at the more masculine and well living man, but as time went on, the more branding has developed into a luxury product. We continue the trend of luxury products, but the new collections have a slightly softer look and for both men and women. ÉSTIE's customer has been a more successful than average enterprising man aged 25-45, who values personality, product quality and design and wants to be part of a brand that suits him in terms of it’s story. At the end of this year, with the launch of the backpack, hand luggage and perfume, we will send a clear signal to women that they, too, are included in the ÉSTIE target group. Nevertheless, not every woman can identify with the ÉSTIE brand, but is a brave, distinctive and characteristic woman aged 25-45 who wants to do everything in her power to be as successful as possible in both private and professional life.
Just as Wiedmann pointed out in his research, the main characteristics of consumers of luxury products are: materialists, rational functionalists, extravagant longing for prestige and introventical hedoists. (Measuring consumers' luxury value perception: A cross-cultural framework, 2007)
ÉSTIE TARGET PRODUCTS
Today, ÉSTIE's product portfolio includes 13 different products and this number will reach 16 by the end of this year. Bags and accessories are our DNA, which we will pass on in future activities, but at the same time we put a strong emphasis on clothing products.
We have concluded cooperation agreements with reputable production lines and do not consider it necessary to have our own production in the near future, as this would add risks, responsibilities and increase initial costs for us. That is why we have decided to use the production lines used by big brands as well.
WHERE ARE WE HEADING?
Our goal is to create an all-in-all luxury clothing brand for both women and men to include clothing, leather goods and accessories with Scandinavian design and practicality.
We create a modern fashion house that would not only be a clothing brand, but would also focus on innovative sales, exclusivity and the addition of IT technology in the old-school retail trade business. For example, one of our goals is to provide a service where a person does not have to come to a physical store to purchase ÉSTIE products. This means developing systems in a completely new way, where data from customer measurements to consumption habits are received directly into the web environment. On the other hand, we want to create a physical shopping environment where the customer can draw inspiration and a pleasant experience - part of the brand's history and production.
ÉSTIE PRODUCTION EXAMPLE:
UNIQUE BUSINESS MODEL
ÉSTIE also includes the Scandinavian menswear boutique Brage by ÉSTIE, located in T1 Mall of Tallinn. It is not just a place to shop, but the store was created to gather feedback and contacts to create the ÉSTIE clothing line. The shop features the best Scandinavian brands such as Tiger of Sweden, J.Lindeberg, ETON, Björn Borg, Ubr, etc. We plan to create a Nordic lifestyle concept with investments made through the Fundwise platform, where women's clothing would also be represented and each brand would be out with a shop-in-shop solution. All this in order to get feedback from the market on women's clothing as well and to try out the solutions that will be implemented in the ÉSTIE mono-brand store in the future.
The production of our bags and accessories take place in Spain, the production of suitcases in Italy, perfume in France and we will also start producing clothing products. Preferably in Europe, but there is also the possibility to produce in the USA or South Korea. The products are manufactured in factories, where the products of the world's top brands are also made.
Until now, we designed the products ourselves and involved leather artists in the design process. Thanks to visiting the world's largest leather fair Lineapelle twice, we got in touch with a designer and developed a position for ÉSTIE's chief designer with him. Today, all ÉSTIE production is designed by Italian designer Tom.
All materials used in ÉSTIE products are of the highest excellence, which guarantees the exclusivity and quality of the products. The materials come from Italy and Spain.
Brand story - see "ÉSTIE brand story" for more details.
ÉSTIE's value proposition consists of a unique brand story, high-quality leather work, interesting design and meeting the needs of the Nordic and Asian luxury markets.
Unique brand story
Thanks to Estonia's small size, but still an interesting and sometimes difficult history, we have a story to tell in the fashion world. Today we know that this story is appreciated by both Scandinavian and Asian people. See the market description for more details.
Quality leather work
In today's crisis situation, we can see how brands that are focused on fast fashion and whose target group loses or decreases their financial capacity suffer the most. It doesn’t concern us much, because we believe that more and more people will buy less and would want something unique and of high quality. All fashion products are moving away from fast fashion, because customers also rely on understanding - sustainable, but higher quality due to sustainable thinking.
In our design, we follow the minimalist design and practicality typical of the Nordic countries. We get inspiration from the society and nature around us and combine it with the needs of the market.
Meeting the needs of the Nordic and Asian luxury markets
On a daily basis, we see on the example of Brage and in constant contact with sales representatives and brands, that the market has an unmet need for the Nordic luxury market. The Nordic luxury market does not need a winter jacket that suffers from -5 degrees in Western Europe, and in August customers also want to choose swimwear instead of shopping for leftovers. These are just two examples of the challenges that remain unresolved in the Nordic luxury market today, and ÉSTIE is designed to make the difference. Western European brands are currently dominating the Asian luxury market, as they were large enough at the time and, along with Asian wealth, grew as a natural part of their luxury consumption. Today, there is a lot of growth in the market there, but the locals need something new, with a different story. After all, you are buying a story, not purely a product. For more information, see the Market chapter.
BRAGE BY ÉSTIE
The ÉSTIE brand includes the Nordic concept store Brage, where we resell the best-known and highest-quality brands all over Scandinavia. As each brand is generally strong in only one product segment, we focus on highlighting the strengths of each brand in the Brage store. For example, we mostly only take suits under the Tiger of Sweden brand, because it offers almost everything in its product range, but it has mainly become known for its suits.
Kaubamaja sells largely the same brands in the Estonian market, Stockmann in Scandinavia and the Baltics, but even as our target groups and in some cases the products overlap, the whole Brage atmosphere and carefully selected, bolder product range gives us a market advantage and fills the gap in customer needs in the Baltics and Scandinavia.
Further plans include the expansion of the Brage store and the transformation of the current concept (boutique) into a 335 square meter Scandinavian lifestyle department store. This gives us the opportunity to offer not only men's products but also women's products, golf clothing that accompanies lifestyle, offer an experience in the form of art exhibitions and fashion shows, and also offer more interesting products from the additional bar area. The Brage lifestyle store becomes a place where a people want to have an experience and also express themselves as an added value by purchasing a selection of clothes.
Brage by ÉSTIE store opening party:
Our goal is to grow ÉSTIE into a world-famous fashion brand, known for its interesting story and high-quality design.
The global luxury fashion market is worth 58.4 billion euros and is expected to grow to 74.1 billion euros by 2023. The size of the luxury fashion market in our target markets (Northern Europe, Hong Kong, Taiwan, Tokyo, Macau, Singapore, Beijing, Canada, the Netherlands and Germany) is 27.7 billion euros by 2025. By 2040, we’re planning to occupy 3% of luxury fashion market.
The CEO of the Danish shoe brand Ecco has said: "From footwear to water bottles, Scandinavian design is fresh and clean. This means that the target group is from Hong Kong to Los Angeles, no matter what its cultural background or taste. It suits everywhere." (Financial Times, 2012)
Where are we heading?
- Foreign markets
ÉSTIE products have been resold in England, the USA, Finland and Estonia. Through us, the products have reached customers from Germany to the United Arab Emirates.
Our goal is to be immediately confirmed in foreign markets, and certainly at strategic points such as Sweden, Norway and Hong Kong. In these countries, sales are actively carried out through sales agents. The ÉSTIE trademark is also registered both in Europe and Hong Kong.
We will expand to the Asian market next year. We want to enter this market through Hong Kong, because it is one of the largest business cities in the world, and it is already opening its doors to other Asian countries. On the other hand, it is the market we know most from Asia thanks to good cooperation with Invest in Hong Kong.
The business environment also plays a very important role in our activities. This gives us even more confidence to enter the markets of Hong Kong and later Singapore, as these are the most business-friendly societies in the world. In the near future, we will sell ÉSTIE products only to B2B customers in foreign markets, but the strategic plan is also to create a physical store and showrooms in some of the aforementioned target countries.
- Home market
We have to admit that the domestic market is too small for luxury fashion products and therefore increasing our market share in Estonia is not our goal. However, demand in the domestic market increases significantly if the brand is already noticeable worldwide. (Journal of International Business Studies, 2003)
- Product portfolio
We will be improving ÉSTIE's product portfolio already this year with a backpack, hand luggage suitcase and perfume. These are products that are not available in Scandinavia in this form. Nevertheless, we also consider it important to develop existing products and enter the market with an updated collection. Already in the last quarter of next year, we will be launching ÉSTIE's first limited edition clothing collection, which we sell in only a few retail outlets, the Brage store and the ÉSTIE e-store. At the same time, we also produce the first samples of the clothing collection for B2B customers, which can be ordered in advance by 2022.
- Different approach
Nordic brands are weak in their marketing work. We want to be a pioneer here, and since we consider marketing to be a very important part of the fashion industry, we will greatly increase our marketing volumes. Due to our unique strategy, we are able to adapt to market needs faster than others and gather feedback both through the Brage store and the brands we represent at Brage.
We believe that 21st century retail business should change. Hopefully in the future, only ÉSTIE stores will be places that do not look like classic stores, but talk, educate and enhance each visiting individual. That's why we've already taken the first steps with Brage to try interesting solutions like 360 degree marketing. The new concept places more emphasis on lifestyle and offers experience through interactive solutions and opportunities to spend time.
We want to offer clothing products in a slow way, which means that we are in line with market trends. On the one hand, it creates value for the end consumer, because today the perception of fast fashion has changed, but on the other hand, it reduces the risks both for us in production and for resellers. Namely, in the case of a multi-year collection, dealers do not have to make end-of-season discounts, as they can offer the same products the following year. We also spend less resources on developing new products. This is the path taken by Norway's beloved outerwear brand Ubr.
"The truth is that the consumer market is just slowing down and shifting modes. One extracts the sense that at least a small dose of luxury is taken as a birthright by the mass of consumers and that millions are primed to upgrade to quality rather than accumulate quantity" (Yeoman, 2015).
Traction & Accomplishments
In April 2019, we opened our first men's boutique in the T1 Mall of Tallinn shopping center. Things developed quickly and already in October we opened another store in the FORUM center. This year we got to know the customer's needs and tried different ways to sell in order to gather as much feedback and information as possible. We were most happy when the employees of Kaubamaja sent customers to our store. This means that we are earning trust in the Estonian fashion landscape with our niche and product and brand selection. We know that the T1 Mall of Tallinn shopping center has received strong negative feedback in the media, but nevertheless we are convinced that this is the ideal place for us to develop the concept at the moment.
We introduced our products and got acquainted with the manufacturers in Italy, at the world's largest leather fair Lineapelle. At the same time, we found the best possible procurement material as well as signed a cooperation agreement with a production line in Spain (producing bags for the world's largest luxury brands such as Louis Vuitton and Prada, among others). Half a year later, we were able to make contact at the same fair to produce suitcases. On the last day of the fair, the trip to their factory was fully justified when we also signed a cooperation agreement with the factory that produces suitcases for Dolce & Gabbana and Louis Vuitton, among others. In developing this product, we would be the only premium brand offering a suitcase in all of Scandinavia and the Baltics.
NB: Louis Vuitton is the TOP1 luxury brand in the world (Interbrand report 2019) and has an important role to play for the factories they work with. Already today we can say that the quality of our new products meets the best standards in the world.
Just before this round of funding, we started working with Italian designer Tom, which gives us, on the one hand, contacts and knowledge to build our own brand, and on the other hand, he will became the chief designer of the ÉSTIE brand. He is a renowned fashion designer who is also a professor at the Milan and Naples Fashion Academies. In addition, he has previously worked with world-famous luxury brands - this is our talisman.
Our products have been represented in the world's leading men's fashion magazines for many years, which is why we have made 70% of our own sales outside of Estonia.
We have successfully sold products of the J. Lindeberg brand and also sponsored the oldest golf tournament in Estonia. Thanks to good work, we reached a cooperation agreement to be the official representatives of J. Lindeberg in the Baltics. J.Lindeberg is the best-selling brand in the Brage by ÉSTIE store.
Samuel (CEO of ÉSTIE) and Hains (Sales Manager of ÉSTIE) at Lineapelle after a successful cooperation agreement:
How We’re Different
Our differentiation comes from range of different aspects - from a strong team to ÉSTIE product solutions.
- In the development of the ÉSTIE brand in bags and suitcases, we have quickly reached the best possible quality in the world with materials and production solutions that no Scandinavian brand has previously been able to.
- We have a motivated, young and talented team that reacts quickly to changes that affect the company's operations.
- We have sales agents with decades of experience who have joined the team, which gives us a clear market advantage
- The team has been joined by renowned chief designer Tom
- Marketing capability to promote rapid development and sales work
- The unique design and story of the region
- Specific target group
The uniqueness of luxury products is due to the fact that most luxury brands have very strong roots. Many customers want a long history that spans several generations. These factors are passed on to the added value of a luxury product, giving customers exclusivity and making them feel special (Kapferer, J.N. (2009), The Luxury Strategy).
ÉSTIE is based on this, because no brand in the Nordic region is committed to such a story and roots. See Product / Service Description - ÉSTIE Brand Story.
BRAGE BY ÉSTIE
- As resellers, we offer something personal and exclusive in our product range, but at the same time practical and everyday. This means that we focus on offering the best quality, among other things, something that is not otherwise available on the market.
- Selected and well-thought-out product range. Most resellers take in blind containers or conservatively and superficially choose only what would definitely sell but doesn’t meet all the customer's needs.
- We use different marketing tools, such as fragrance marketing, and focus on all five human senses in the internal marketing of our store:
Unique scent - fragrance machine
Exceptional visual - store interior and design
Taste senses - free drink (in the new Brage concept)
Hearing - selected music selection
Touch - one-on-one sales and a sense of quality of products and materials
Uses of Funds & Timeline
We need competent staff, a wide range of goods, an increase in ÉSTIE's product range and a marketing budget. As a result, we include an additional investment of up to 300,000 euros, against which we offer 14.63% of the company.
Investment, together with sales revenue, helps us to invest in 4 main goals:
- Stock replenishment and physical store maintenance costs to meet growing demand
Offering the women's product segment significantly increases our target group and customer base. We are also significantly increasing our customer base and sales numbers by bringing golf clothing up for sale.
- Increasing marketing volumes and rebranding the online store to significantly increase sales
With the establishment of a new concept and the launch of new products, we want to make a launch kick for both the ÉSTIE and Brage brands. Do marketing both in Estonia and throughout Scandinavia.
- Developing our production for higher profits
We want to come to the market first with a suitcase, backpack and perfume. We will add a new color selection to the current collection and develop a comprehensive salesbook. Bringing perfume to the market helps us to enter the product segment with the highest margin. A new and exciting Nordic collection of leather products with an Italian nuance is also in the design stage. We are also already creating a moodboard and analyzing the market for textile products.
- Hiring specialists in the field of sales and marketing in order to significantly accelerate sales
We have the best people in their field who are ready to start cooperating. So far, it hasn’t been possible or sensible for us to involve additional forces.
For an investment of EUR 150 000:
- We launch the ÉSTIE backpack, hand luggage suitcase and perfume
- We are adding a new collection to the existing ÉSTIE product range in cooperation with Italian designer Tom
- We are replenishing Brage by ÉSTIE stocks
- We use the raised capital (only if necessary) during the year to cover the maintenance costs of the Brage store
- Entering foreign markets
- Development of the ÉSTIE online store
- Marketing activities through which we increase sales results and brand awareness
With investment of EUR 300 000, in addition to the above:
- We launch the first ÉSTIE clothing products
- We participate in trade fairs and motivate sales agents to achieve the best sales results
- We create professional B2C and B2B web environments for both brands
- We are looking for opportunities to build a mono brand store for one of the most valued brands in Scandinavia
We have assessed the following aspects to the present value of our company:
- The company 's growth potential
- Network of contacts and partners in production and sales
- A functioning and motivated team
- Systematic and structured organizational management
- ÉSTIE as brand equity
- Product developments and technological drawings
- Existence of a physical store
- Investments made in the Brage by ÉSTIE store
Obligations to Investors, Profit Distribution
We promise to work with the team cost-effectively and do everything in our power to make Estie OÜ a profitable and successful company. We believe that we can fill the market niche and give every investor the opportunity to be proud of their investment.
We promise to consistently share data with investors:
Quarterly reports and key performance indicators, consisting of profit and loss accounts, investments made and number of employees.
We want to account for at least 30% of dividends from 2025 profits.
In the event of a sale of a company, investors will be able to sell their stake in accordance with the terms of a possible sale. We stand for the interests of all investors to be protected equally in the future.
In addition to participation and future profit distribution, investors also receive gifts according to the investment made:
- All investors have a lifetime -5% discount on all products in Brage and ÉSTIE stores and e-stores.
- Investment 1000 - 2999 euros -10% discount on all products during the whole period of being an investor.
- Investment 3000 - 9999 euros - 15% discount on all products during the whole period of being an investor.
- Investment 10,000 - 24,999 euros -20% discount on all products during the entire investor period and a one-time VIP invitation with the ÉSTIE team to a special foreign event (for example, Pitti Uomo).
- Investment from 25,000 euros -50% discount on all products during the whole investor period and a one-time VIP invitation with the ÉSTIE team to a special foreign event (for example, Pitti Uomo). In addition, a freely chosen one-time selection of a collection from the Brage store or the ÉSTIE product range worth 3,000 euros.
Within two years, all shareholders have the opportunity to purchase the special ÉSTIE investor collection with their initials.
Risks and Mitigation
- Competition - we know that we have our own deep reason for creating and growing the ÉSTIE brand. Competition always exists in one way or another, but in this respect we are able to stand firm and fight for our place in the market thanks to our determination and different thinking.
- Product copying is a trade secret that distinguishes products that have undergone our production process, soon every ÉSTIE customer can find out at home. This is necessary to prevent brand image fraud.
- The economic downturn - it’s a very interesting point, but we are convinced that this is a misconception that the economic downturn is directly linked to the luxury market. Yes, the economic downturn is affecting all sectors to a greater or lesser extent. Nevertheless, research shows that sales of luxury goods fall during the recession, but not drastically. At the same time, the market for luxury products is recovering and strengthening faster than other sectors. (Dawar and Parker, 1994).
- ÉSTIE products are of high quality, timeless and the brand has a strong tradition of generations.
ÉSTIE has been represented by: