Many of the companies we invest in have fascinating histories, and this Italian fairytale you will read about is certainly one of them.
Brunello Cucinelli is an Italian luxury creative director and the chairman of the company with the same name, a fashion brand which sells menswear, womenswear and accessories in Europe, North America and East Asia. In 2023, sales increased by more than 20% to EUR 1.14bn.
Brunello was born in 1953 and grew up in a rural agricultural community outside of Perugia, and his childhood home had no electricity or running water. On the company’s homepage he writes about the beginnings of the company, which is an amazing story packed with wonderful life lessons, therefore I want to highlight some extracts:
‘When I was 24 years old, I was hired as a model by a sportswear company located near my house; it was a leading company in the global ski and tennis sector. I used to always dress well, read fashion magazines and stay updated on the latest trends. In this way, I gradually moved towards the future and at the age of 25, I made my decision: I wanted to make colored cashmere sweaters, only for women, in line with contemporary style. I was firmly convinced of the idea of producing high-quality garments that reflected Italian craftsmanship and manual skills, items that were certainly expensive but not excessively so, designed for a market segment called “absolute luxury”. I’ve always believed that to do something special you have to focus on a single project that is your lifelong dream.
I still hold dear the memory of that good man and great professional whom I asked to sell me about twenty kilograms of ecru-colored cashmere yarn, a sufficient amount to make about sixty sweaters. With a fatherly gesture, he told me that he would have certainly sold them to me, then he said something that still moves me deeply, “You’ll pay me when you earn your first money. I know you, you’re a good young man”. Unfortunately, he suffered a serious illness in early old age and I didn’t have the chance to thank him as much as I would have liked.
A special moment was when I went to a dyeing plant and met Alessio for the first time, perhaps one of the greatest experts in cashmere dyeing. I brought him six women’s cashmere sweaters and I asked him to dye them in six different colors, which were not too bright, however. At first his sharp reply was, “You’re crazy to dye cashmere in these colors”. For most of the morning I tried to convince him in every way, begging him to do as I asked. In the end he told me, “Let’s give it a try, but I can’t guarantee the result”. This was undoubtedly the most important moment in my life. I owe a lot to this man: a joker, an idealist, a dreamer who was very devoted to his roots.
My first customer was Albert Franz from a beautiful little town near Bolzano called Naturno, who was the owner of a boutique and who is still a customer of ours today. His behavior was exemplary from the start: professional, accurate, rigorous and humane. There was affinity between us, as well as esteem, so we started working together. Without any doubt I will always remember in my heart his first order for fifty-three cashmere sweaters.
I also hold loving memories of Vincenzo, one of my first customers who lived and worked in Milan. One day, he made a very significant order and said to me, “This is the money, I want you to use it for your business”; it was a lot of money, I was speechless: to understand my state of mind just think about those tough early years and the little amount of money that I managed back then. Instinctively, regardless of my own personal interest, I asked him what guarantees he thought I could give him, since I had no money or possessions. With a benevolent smile on his face, he told me, “I have five brothers, and with me it makes six, and then there’s my father and my mother; and we all believe in your entrepreneurial and moral skills, we believe in you. This is enough for us; so don’t worry about the money, just keep your head down and work without worries, and that’s all”. That type of situation really unleashed my skills and made me want to surpass myself. And that’s what I did.
My farming background and my personal experiences had a lot to do with this decision. I remember once again how painful it was to listen to the humiliations that my father used to bear in the factory and to see his teary eyes, and how such pain has turned into the firm rejection of any offence to the dignity of people. My moral imperative was to never fail to respect human values, a tenet that I still constantly abide by.
I believed in creating valuable items without causing any harm to Creation, or as little as possible. I imagined products that could be just as gratifying for the wearers as they were for the workers who made them, I imagined people working in a beautiful workplace: a place where workers had pleasant and relaxing breaks, where the artisanal dimension reigned supreme. I wanted human relations to respect humanity and truth, and wages to be sufficient to live a dignified and serene life. The working atmosphere that I imagined was a peaceful one where creativity could be unleashed. I imagined making profit, indeed, but based on ethics, dignity and morality, trying to give form to the fascinating relationship between “profit and giving back” that made me feel, in my own small way, as a custodian of Creation.
At the time, my mind used to wander back to my dad’s teachings: if you are not a good person you won’t have people’s respect; the professionalism, courage and transparency of one’s actions, in other words, respect for dignity, your own and others’, are fundamental in life.’
Brunello Cucinelli got married and lived at his wife’s house in Solomeo, when he decided to purchase the town’s then degraded and neglected castle.
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Today, Solomeo is still the company’s headquarters, and Cucinelli's family trust owns 50% of the company's stock, which went public in 2012.
The company donates 20% of profits to its charitable foundation, and pays its 1300 employees workers wages that are 20% higher than the industry average. They do not punch a time clock, and after-hours e-mails are not allowed.
Over the years, Brunello Cucinelli has been known worldwide for their classic, timeless designs and their use of exceptional materials. Taking pride in their ‘Made in Italy’ philosophy, they have expanded their artisan laboratories in their home country to over 360. To this day, 50 percent of their garments are produced through manual skills using needle, thread and scissors. Brunello
As of today, Brunello Cucinelli is present in multi-brand and premium department stores in the world’s leading cities. Demand for the companies’ products remains high, and as a result of that sales are expected to grow by 10% per year in 2024 and 205, according to recent comments.
Many companies change their top managers regularly, and hire (usually assisted by expensive head hunters) people with excellent CVs, to implement their strategic visions, or in more severe cases their turnaround plans. And in many cases, when the plans don’t work out as hoped for, those managers move on to the next company which they can (or cannot) help. There is nothing wrong about this in general, but Mr. Cucinelli’s beautiful story explains perfectly our preference for companies where its founders are still involved, and make sure that their ‘baby’ will succeed in the long term!
(Sources: Brunello Cucinelli homepage; Wikipedia).
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On the day of writing this article, MW GESTION MULTI CAPS EUROPE holds Brunello Cucinelli for 4.6% of its outstandings.