Wendy Yu on Fashion Investing

    Wendy Yu has amassed an impressive luxury investment portfolio through her company Yu Capital Limited.
    Entrepreneur Wendy Yu has amassed an impressive luxury investment portfolio through her company Yu Capital Limited. Illustration: Chenxi Li/Jing Daily.
      Published   in Fashion

    Jing Daily's next influencer who's shaping China’s booming luxury industry is the fashion and lifestyle entrepreneur Wendy Yu. Lauded by the global press, she was recently hailed by the UK’s Times as the most powerful woman in fashion — impressive recognition for a 30-year-old female Chinese investor and arts patron. But that label didn’t just appear from nowhere. She established her business, Yu Capital Limited, in 2017 and has been scouring the globe for emerging fashion, lifestyle, and technology businesses ever since.

    Early philanthropical commitments point to an affinity for cultural platforms, including the endowment of the curatorial position at The Costume Institute, Metropolitan Museum of Art, New York - where Andrew Bolton is the incumbent Wendy Yu Curator in Charge. Furthermore, Yu has made donations to the prestigious Victoria & Albert Museum and the National Portrait Gallery, both in London. Her company also sponsored the BoF China Prize: an industry award that promotes emerging Chinese designers, won by Parsons graduate Caroline Hu.

    Yu's impressive portfolio of assets features investment shares in the e-commerce platform as well as a number of London-based luxury brands, including the upcycled accessories line Bottletop and Cefinn — a brand founded by former UK British Prime Minister David Cameron's wife, Samantha Cameron. The Greek designer Mary Katrantzou, eager to advance into the Chinese market, also received support from Yu, who acquired a minority stake in the fashion brand in 2018.

    In the past, Yu has acknowledged that she’s in a unique position to bridge the gap between China and the rest of the world via funding and business development, though it certainly helps that British designers are fascinated by China’s market. Her shrewd business acumen is establishing her company as a trusted partner and collaborator for companies looking to launch and expand in the China market.

    Already featured in Forbes’ China’s 30 under 30, Yu was set to receive the Millennial Leadership Award at the China Institute’s 2020 China Fashion Gala event in April (previous award winners include Angelica Cheung, Vivienne Tam, and Christian Louboutin) - unfortunately now postponed. Jing Daily spoke to the intuitive investor about what she looks for in a potential investee, the comfort of coloring in a COVID-19 world, and her admiration for Shanghai Fashion Week.

    How did you begin your journey in fashion?#

    I started by studying Fashion Management at London College of Fashion and then completed an internship at Vogue China. Later, I began my career in fashion through investment. I set up a private fund, Yu Capital, to support creative and technology-led businesses.

    What do you find most inspiring about the industry?#

    The fact that fashion is always thinking, moving forward, and relevant to our culture and everyday lives. Also the community — I have met some of the most inspiring people through the industry from creative, business, and political viewpoints. Creativity is a powerful and universal language that builds bridges between people and continents.

    What makes an investment worthwhile?#

    I think it’s important to invest with purpose and to differentiate yourself from other players in the market. Within the Yu Capital portfolio, I want to have an interesting mix of investments that are relevant to our mission and strategy but can also achieve a good financial and strategic balance. For our technology investments, we tend to invest in companies in the pre-IPO stage or later. But for luxury fashion brands, we invest much earlier because Yu Holdings’ mission is to be a cultivator of creativity. Building a strong brand is a long-term game where you stand to gain financially but also contribute to global culture. It’s the legacy that a brand could leave behind that excites me.

    How do you make your brand choices when it comes to investing?#

    For me, investing is as much about intuition as it is about analytics. I look for business founders who have acute business and management skills but also have a strong vision, purpose, and story to tell. Then I assess opportunities for the brand in China, as that’s where I can add value.

    Have you noticed any shifts in the new talent in China or the general fashion environment there?#

    Thanks to technology, fashion in China is becoming more and more democratic and approachable these days, which is a mixed blessing. Today, both luxury and grassroots designer brands want to have direct conversations with their community, and they’re looking to convert branding into sales revenue. With such a noisy landscape, developing a unique and engaging tone and narrative has never been more important.

    What’s the difference between working with a young brand like Caroline Hu versus a large international brand?#

    It’s very different. Caroline Hu is at the beginning of her journey. She is very pure and still looking to make a name for herself. She wants to put her business’ basic foundation into place. Larger international brands have completely different priorities and are looking for scale and market growth. I don’t think the two are comparable.

    Because of the virus, did you feel an impact during the fashion weeks you attended?#

    Since I was recently appointed an ambassador for the Fédération de la Mode et de la Couture, I briefly passed through Paris in February for a few meetings and an evening hosted by President Macron in honor of Paris Fashion Week. This was just as Italy was becoming the focus of the COVID-19 crisis, and it was, of course, a very real topic of conversation.

    Many brands, editors, and buyers from around the world, particularly from China, had already decided not to travel, and it became increasingly apparent that there would be a much greater impact on the global industry than we had initially imagined. Now, in hindsight, perhaps that moment was the end of traditional fashion circuits as we knew them. While I think fashion weeks will still be relevant, future shifts in the industry are inevitable and, some would argue, much overdue.

    How can relationships between luxury brands and Chinese consumers be quickly rebuilt?#

    I think there will be a natural return to retail and luxury over time, but this epidemic will inspire us to be more purposeful about our decisions and spending, which will, in turn, create new and improved benchmarks for brands to meet to be relevant.

    How do you think international brands are coping with the crisis and have any brand campaigns left a strong impression on you?#

    I’m inspired by creativity in times like these. Even though the world has effectively stopped, it’s amazing to see brands use technology and fun ideas to keep their customers engaged, from Mary Katrantzou’s just-launched downloadable coloring sheets for people to print at home to digital dinners and brand presentations on Zoom.

    Finally, what are your thoughts about Shanghai Fashion Week’s shift to its new ‘cloud’ direction?#

    I have great admiration for the organizers of Shanghai Fashion Week and the designers who have showcased there. It’s truly incredible that they didn't give up and pulled this together in such a short period of time. The cloud fashion week was a daring and successful experiment, considering it was created as a last resort. It’s great that designers can connect and sell to customers through Tmall’s platform, which will, in turn, support their cash flow and potentially help their businesses survive the pandemic. I’ve seen some impressive digital presentations from Ms Min, Angel Chen, and Fengyi Tan, who have each excelled at channeling their creativity and personalities.

    I feel that we will still very much need offline events in the future for our fashion community to get together and communicate with one another. But this can be complemented by digital solutions that further amplify and connect us by replacing or supplementing traditional runway shows.

    Discover more
    Daily BriefAnalysis, news, and insights delivered to your inbox.