Charney, Dov

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Charney, Dov

Chief Executive Officer of American Apparel

B orn January 31, 1969, in Montreal, Canada; son of Morris (an architect) and Sylvia (an artist) Charney. Education: Attended Tufts University, c. late 1980s.

Addresses: Office—American Apparel, Inc., 747 Warehouse St., Los Angeles, CA 90021.

Career

F ounded T-shirt manufacturing company in Columbia, SC, 1989; moved business to Los Angeles, c. 1996 and renamed it American Apparel, Inc.; opened first American Apparel store in Los Angeles, 2003; company acquired by Endeavor Acquisition Corporation, 2006.

Sidelights

D ov Charney is the founder and chief executive officer of American Apparel, Inc., a rapidly growing company with more than 150 stores in North America and Europe, along with outposts as far away as Israel and South Korea. The company’s brand identity is closely linked to Charney, who sometimes sports an extravagant handlebar mustache and is known for making provocative, sometimes sexually charged statements in the media. “A complicated, charismatic and occasionally controversial figure,” wrote Jaime Wolf in a lengthy New York Times Magazine profile in 2006, “Charney is so acutely in tune with the cultural moment that he is somehow able to use the plain blank T-shirts that he sells to convey potent messages concerning contemporary sex and politics.”

Charney was born in Montreal, Canada, in 1969, into an accomplished Israeli-immigrant family. His uncle was renowned architect Moshe Safdie, who designed one of the city’s architectural landmarks, the Habitat 67 housing complex. Safdie was the brother of Charney’s mother, Sylvia, an artist, and Charney’s father, Morris, was also an architect. During his high school years, Charney attended Choate Rosemary Hall, a private boarding school in Wall-ingford, Connecticut, and went on to enroll in Tufts University in the Boston area, but he left before earning his degree.

Charney was obsessed with T-shirts at an early age. When visiting relatives in Florida, he was astounded by the marked differences between those sold in the United States by companies such as Hanes and the ones available to Canadian shoppers, which he could tell were made from inferior cotton. He began buying the Hanes in bulk and reselling them to a friend who had a printed T-shirt business targeting concert-goers and hockey fans outside the Montreal Forum. In 1989, Charney moved to Columbia, South Carolina, where he set up a T-shirt-manufacturing company, but it failed and entered Chapter 11 bankruptcy status. Abusiness associate who had his own apparel business, Rick Klotz of Fresh Jive, convinced Charney to move to Los Angeles and set up shop there.

The first American Apparel T-shirts came out of Charney’s new factory located just off Interstate Highway 10, also known as the Santa Monica Freeway, in 1997. Charney was convinced that he could corner the market by producing a T-shirt from good-quality cotton, knit with a tighter weave that held its shape over time, and styled to have a slimmer fit and longer length. In a 2000 profile that appeared in the New Yorker, Charney explained to writer Malcolm Gladwell: “The finest T-shirts are six dollars a piece wholesale. The [worst] shirts are like two dollars. We’re going to come in at three and have the right stuff. I’m making the perfect fit. I’m going to manufacture this like gasoline.”

While American Apparel was originally a wholesaler of T-shirts, in the summer of 2003 Charney rented a storefront in order to stage a gallery exhibition for an artist friend and put out some of his company’s T-shirts for sale, too. They sold quickly, and out of that gritty, hipster venue was born Charney’s idea for a retail empire. He set up white-box, gallery-like spaces in arty neighborhoods such as Nolita in New York City and Chicago’s Wicker Park and by mid2007 had 145 American Apparel stores around the world. The stores sold the company’s wares, which had expanded to include tank tops, leggings, shorts, and underwear, and were somewhat daring in their décor, which relied heavily on large color photographs—taken by Char-ney in many cases—of his employees or other young adults wearing American Apparel items along with risqué images from pornography magazines of the 1970s. The photographs became the basis for a national advertising campaign and had “a flashbulb-lighted, lo-fi sultriness to them,” wrote Wolf in the New York Times Magazine article. “They look less like ads than photos you’d see posted on someone’s Myspace page.”

Business journalists writing about Charney liked to focus on that edgy, soft-core porn vibe that seemed emblematic of the brand identity, but some writers also noted that the CEO was a maverick in the U.S. apparel-manufacturing business, paying the 5,000 workers at his Los Angeles factory well above the average wage for the industry and offering a slew of generous benefits, including on-site meals and a masseuse along with free English lessons for immigrants. Sewers of American Apparel shirts and other items became the highest-paid mass-produced garment workers in the world, and as the company met the demand for more stores, the headquarters became the largest garment manufacturing establishment in the United States.

Most apparel companies use overseas manufacturers to make their wares, which keeps costs low, but Charney explained his philosophy to David Greenberg in an interview for the Los Angeles Business Journal, noting that banks that provide loans to startup manufacturers like he once was would “rather you open a line of credit for a one-shot deal and pull the goods in from China than have you buy knitting and sewing machines and do it here.” Despite the comparative high costs of Charney’s business, his vision seemed to be working, and company sales were estimated at $275 million in 2006. American Apparel became a publicly traded company in December of that year. The structure of its initial public offering was somewhat unusual, with Charney’s privately held company becoming part of a publicly traded one called Endeavor Acquisition Corporation, which was an investment group.

After the deal, rumored to be in the neighborhood of $380 million, Charney planned to open hundreds of new stores and said he hoped to make American Apparel as ubiquitous in malls and other retail spaces as Abercrombie & Fitch. He was also exploring the idea of a print magazine and a new kind of store for his target urban-hipster customer that would sell electronics and basic staples. “American Apparel is the new normal,” he told Wolf in the New York Times Magazine interview. “It’s fun to say, ‘He’s wild and crazy,’ but I’m not wild and crazy. This is the way the adult generation is going to live. They’re not preoccupied by monogamy. Exciting things can happen. They’re mobile; they can travel; they’re willing to take chances; they’re open-minded and ready for change. That’s what the boomers presented for America, and that’s what this new generation presents for us. I want to be in business with them.”