With a diverse background and a clear vision, this philosopher has reinvented his family business to build a future for U.S. apparel
by Savannah Sitton • photos by Robert Nuzzie
Unbeknownst to many, Gary Wassner entrepreneur, fiction and children’s book author, and a judge/investor on television’s Project Runway Fashion Startup has masterminded the trajectory of top fashion designers and brands for more than 40 years. In the process, he has reshaped the industry by redesigning his family business to support emerging fashion.
Wassner is largely credited with revolutionizing the business practices of American fashion designers. Among the celebrated couturiers he’s helped popularize are Jason Wu, Vivienne Westwood, and his first fashion success, Betsey Johnson. When Johnson was an unknown emerging artist, she came to Wassner with $15,000 in sales and no way to fill those orders. At the time, banks were reluctant to support small independent designer driven brands. Believing that reluctance was limiting American fashion’s global credibility, Wassner opted to change things.
A willingness to risk capital on young talent made Wassner a pioneer, and set a new standard in the factoring industry that Hilldun, his family’s business, is known for. In the apparel industry, “factoring” provides cash flow in the form of short term financial arrangements specifically designed for fashion sector entrepreneurs. A factoring company actually purchases outstanding invoices, sending the apparel company an advance on the invoice value.
“I don’t like to call myself a factor although technically we are because we do a lot more than the traditional terminology,” said Wassner, who started in the industry in the 1970s. With a master’s degree in 19th century philosophy and on track to become a college professor, he was pursuing his doctorate at Bryn Mawr College when his father fell ill. He left school and assumed responsibility for the family business, Hilldun Corporation, then a small real estate management firm. At the time, Wassner couldn’t have imagined he’d eventually be named one of the “Most Influential People in Fashion” by Fashionista.
Wassner’s vision, educational background, and experience cause him to base decisions on what actually works for a brand instead of following a more conventional, one size fits all template.
“We’re embedded in the industry. Everyone else is just in banking; we’re in fashion,” he observed, adding that Hilldun’s finance and credit work is handled in house. The company also acts as an unofficial board of directors for many of its clients, offering advice based on years of trial and error.
“It’s easy to have perspective when you’ve been immersed in hundreds of brands over the years, as opposed to just one,” he said. “We understand everything about the business that could go wrong, from the design process to the production process, and we make sure our clients do, too.”
Its long experience nurturing emerging designers from infancy has given Wassner and Hilldun credibility. Its business partners, including Tom Lee of Lee Equity and designer Rebecca Minkoff, have helped make Wassner a trusted name in both fashion and finance, and he has been recognized as an important player in both industries for decades. He’s on the advisory board of the Council of Fashion Designers of America (CFDA), the Fashion Law Institute, Fashion Group International, and the first High School of Fashion in the country. He serves on numerous other related organizations as well.
When not traveling to Europe or the West Coast, Wassner occupies a modest New York City office decorated with tasteful art and family photos, a display of his books, and images of Marilyn Monroe. Whoopie Goldberg and Paula Abdul are regular visitors. Goldberg wanted to base a TV show on Wassner’s day to day life and shot a pilot showcasing his skills in mentoring and building brands. Still, Wassner doesn’t take full credit for his business plan.
“I really believe they do it right in Europe when it comes to supporting fashion,” he said. “They leverage intelligence, executive level leadership, and factories over their whole platform of brands. Nobody was doing that here.”
It was this concept that informed his latest venture Interluxe Holdings LLC a private equity firm created in 2014 that supports growing brands with capital, infrastructure, business resources, and strategic guidance to accelerate business growth. Current investments include Jason Wu, A.L.C. Clothing, and the outerwear brand Mackage.
With major retailers downsizing and shuttering some locations, some see an imminent department store apocalypse. The stores’ biggest mistake, as Wassner sees it, was misdirected promotion that is, discounting practices that trained consumers to avoid full price items. Still, it’s not all bad news, and Wassner cited Macy’s as one retailer that recouped its losses with an exemplary rebranding.
“They recognized they couldn’t compete on price point against the discounters and the Internet anymore,” Wassner noted. “Now Macy’s focus is on fashion at their price point, which it hasn’t been on for 15 years.”
In today’s fashion market, what are emerging designers and brands to do? “You don’t need a department store to buy your label for the public to know you exist anymore,” he observed. “You go straight to the consumer and tell your own story that’s what the consumer wants.” For some stores, pop ups are the right footprint for today’s consumers because of the intimate and distinctive feel each location can create based on product mix and the different brands curated for that location and neighborhood. Wassner supports that formula. Fast changing trends, volatility, and the effects created by fashion “influencers” also challenge the fashion world.
“I spend a lot of time concentrating on millennial discussions in unofficial focus groups,” he said. “Influencers come and go. Consumers question their credibility because influencers are paid to wear a product and don’t disclose that properly. We’ve made a 360 degree turn too quickly, and I’m sensing digital fatigue from consumers. They want experience.”
Wassner said that ecommerce and brick and mortar retailing are opposites, when they should be allies. He illustrated the conflict by explaining a philosophical process called a “dialectic,” in which there is a thesis brick and mortar stores and its antithesis—online shopping. The resulting synthesis of the two will be found somewhere in the middle.
“It took too long for department stores to recognize they needed product available on all channels,” he said. “Omni channel and cost of acquisition today is everything. That’s what will put brands in or out of business,” adding that he’s been pitched numerous artificial intelligence related products and believes virtual reality shopping experiences are inevitable. “I just saw a demo for artificial intelligence that looks at what you’re buying, what your size is, and your shape through body scanning so that you get the fit exactly right, which is important, particularly for online.”
Another trend Wassner sees is the death of brand loyalty, combined with the reluctance of younger shoppers to patronize what they see as staid department stores from another era.
“The fashion industry is global today,” he said. “If you want to have a large international business, you must start with a retail footprint for marketing purposes to large international distributors.”
There is still much of the professor in Wassner. Whether advising his clients or mentoring through guest lectures at the Fashion Institute of Technology, the Parsons School of Design, or a number of other fashion boards, he takes pride in giving back to the community. When he was a judge on season one of Project Runway Fashion Startup, Wassner made personal investments. One was in a partnership with a fellow judge on a $250,000 deal to a subscription sock company called Sock 101. That startup was rebranded The School of Socks and mentored to success.
“The best part is being able to help talented people achieve their dreams, and sharing advice I’ve learned over a whole career,” he said. “Creating something that others can appreciate is invaluable, whether it’s the written word, music, garments, or anything else.” That doesn’t mean it’s always fun.
“I wish I could be the nice guy all the time, but you must say no sometimes,” he mused. “When you think somebody is making a bad judgment and putting money in the wrong place, you have to say, ‘I’m the lifeline in that respect no, I can’t.’ I hate that. I don’t like to dash someone’s dreams.”
In addition to contributing his time and skills, he’s also been known to donate the proceeds from his children’s books to the CFDA’s Fashion Incubator Program, a business development initiative designed to support the next generation of New York designers.