Finish Line & GCP tie up for specialty running business
The Finish Line Inc. announced that Gart Capital Partners (GCP) is making a $10 million strategic investment in Finish Line's Running Specialty Group with the goal of creating the nation's single largest operator within the growing specialty running business, a market that has been estimated at up to $1 billion. Finish Line remains majority owner of the Running Specialty Group.
The strategic investment pairs Finish Line, a $1.4 billion national athletic footwear and apparel retailer, with GCP, an equity investment partnership that has a proven track record of successfully executing specialty retail rollups, including a 12-year joint venture with Vail Resorts, Inc. that involved more than 150 ski-related shops generating $200 million in annual sales.
The headquarters of the Running Specialty Group will be relocated to Denver, where GCP will manage all day-to-day operations as well as merchandising and the acquisition of additional running operators from its home base there. Finish Line will continue to leverage its strengths as a leading omni-channel retailer, providing direct logistics, marketing and IT support along with digital expertise. In fact, this spring, the Running Specialty Group will launch Run.com, a digital experience for runners that will be the segment's first to marry content, community and commerce.
For Finish Line, the venture builds upon the 2011 acquisition of an 18-store chain of specialty running shops operating under The Running Company banner. This acquisition represented a first step in pursuing the significant market opportunity within specialty running, which today is a highly fragmented market with limited e-commerce penetration.
“We are excited to take our specialty running growth plans to the next level with GCP,” said Finish Line Chairman and Chief Executive Officer Glenn Lyon. “Like the ski retail business, customers within specialty running prize a shopping experience that is expert, highly localized and infused with the sport's unique culture.”
“Maintaining the individual personality of each running store concept, while providing the synergies of larger-operator systems and back office support, is critical for success. GCP has a proven track record of demonstrating that these principles can be maintained while simultaneously executing a successful rollup strategy. We look forward to growing this business with GCP and are confident that our association will accelerate progress and perhaps serve as an incubator for expansion outside of specialty running down the road.”
“We are excited to partner with Finish Line to create this innovative approach toward growth in the running specialty channel,” said GCP Partner Ken Gart. “We bring the ability to celebrate the unique culture of independent running stores and maintain what makes them great in their local markets while Finish Line brings the efficiencies of a large scale and expertly run retail operation.”