Derek Lam Expands His Apparel Line

By EMILY HOLT
Dec. 4, 2014 1:16 p.m. ET

AT THE ENTRANCE to New York’s sleek Mercer Hotel, a man waits patiently. When the young hostess finally approaches, he says, “We have a reservation for drinks under the name Derek Lam. ”

“Yes, of course; Mr. Lam has requested a table in the back,” she replies unblinkingly.

“Oh, that’s me,” the designer says with a laugh.

Such a scene is typical for Lam, who flies under the radar although his name appears in stores across the country and he dresses celebrities including Julianne Moore, Katie Holmes and Jessica Alba. This is both by choice—Lam is a down-to-earth San Francisco native who won’t be found posting selfies on social media—and by professional circumstance. At 48, he has grown out of being fashion’s boy wonder, but he isn’t gunning to make a billion dollars from an IPO. Instead, 11 years after he started his eponymous label out of his Greenwich Village apartment, he is focused on maintaining a steady, enduring business. The path to success for an independent designer is littered with talented predecessors who fell prey to bad financial decisions and unfocused collections. But, along with his business partner and husband, Jan-Hendrik Schlottmann, 49, Lam has powered through. He has sold his name, bought it back, done a side stint at Italian fashion house Tod’s and launched a lower-priced line, Derek Lam 10 Crosby. This fall, after a minority investment by Sandbridge Capital, which also holds stakes in Karl Lagerfeld’s self-named line and Topshop, he is reaping the rewards. Lam opened his first Derek Lam 10 Crosby store in November in New York’s SoHo, is expanding the line with handbags, has launched e-commerce and next year will double the size of his main line’s boutique on Madison Avenue. “I feel that we’re at the threshold of entering into a bigger realm,” Lam says. “It’s taken us 10 years, but it’s exciting. It seems more like we’re in control.”

It does feel like Lam’s time—the relaxed attitude that is the hallmark of American sportswear has pervaded runways everywhere. Over the past decade, Lam has exhibited a master’s hand at creating an easy silhouette with luxe details. His slim-fitting, knit T-shirts, high-waisted pants and tailored, wide-lapelled trench coats flatter the woman who wears them rather than the man who created them. His clothes are intellectual—reflecting his passions for contemporary architecture and artists such as Dan Flavin—but never tricky. The ’70s and the American West come into play as well, in his long and lean proportions and his use of denim and leather. Lam’s spring 2015 collection is a bounty of patchwork suede in lilac, sand and teal with whipstitch detail, shown to a Joni Mitchell soundtrack. Even when he designs a navy silk evening gown sewn together in the manner of Tibetan prayer flags, he still manages to create something that looks as though it’s not trying too hard.

J. Crew executive creative director Jenna Lyons, who has known Lam since they were both at Parsons the New School for Design, says this was always his aesthetic. In those days, “I’ll never forget; he’d wear the most beautiful leather jacket with a T-shirt and khakis. He’d look so polished and yet not overdressed,” she says. “His collections have that same ease.”

Lam honed his skills at Michael Kors, where he worked on and off for eight years and where his final position was vice president of design. He also learned from the gregarious designer to listen to what his clientele told him at trunk shows and store appearances. “I always ask them, Why do you need fashion?” he says. Yet by making clothes that appeal to a successful, mature woman, Lam says he realized he was missing out on a whole sector of younger, more experimental customers. Derek Lam 10 Crosby, with print-on-print suiting, crop tops and an overall untucked attitude, is for them. Consider the most recent collection, based on the cut-and-paste style of collage artists Fred Free and Sigrid Sandström, which features a white-mesh knit dress and cropped jackets over midi pleated skirts. “It’s like it’s the version of Derek that is still in college,” Lyons observes.

This formula of clothes with a spontaneous vibe and prices that range from $85 for a tank top to $3,300 for a fox-fur vest is working. After two years, Derek Lam 10 Crosby accounts for 60 percent of Lam’s overall business, and Schlottmann thinks that figure could be closer to 80 with the launch of bags and the new store. “Derek’s repertoire of easy, chic sportswear pieces infused with just the right amount of playfulness translates well into the contemporary market,” says Linda Fargo, Bergdorf Goodman’s senior vice president of fashion office and store presentation.

The Mercer Street location of the new Derek Lam 10 Crosby store is familiar terrain: a stone’s throw from the old headquarters and two doors down from where Lam and Schlottmann used to live. (After relocating the office to lower Madison Avenue, the couple moved to Gramercy Park—“The luxury of being able to walk to work is paramount for us,” Lam says.) The store’s clean space features unexpected touches like neon signage and a macramé wall hanging. “I wanted it to be eclectic and to have some strangeness,” Lam says. “I didn’t just want two rows of clothes.”

Architect William Sofield, who has also designed stores for Gucci, Tom Ford and Bottega Veneta, is responsible for the interiors. “In Derek’s clothing there’s always the tactile and the technical side by side,” Sofield says. “I tried to play on that.” He juxtaposed white lacquer shelves with clear-resin racks. (Sofield will also oversee the renovation of Lam’s collection store on the Upper East Side, where they will create an airy space by adding a mezzanine and double-height windows.)

Lam and Sofield were introduced by Domenico De Sole, the former head of Gucci Group and current CEO of Tom Ford, who has been working with Lam ever since he mentored the designer as part of his prize in the 2005 CFDA/Vogue Fashion Fund competition. When De Sole attended his first Derek Lam show nearly a decade ago, his reaction was “Not only are he and Jan great people, but they’re very talented,” he recalls. Others agreed, and for several years, Lam was among the industry’s celebrated young Turks. He won a 2005 CFDA Swarovski’s The Perry Ellis Award for Womenswear and, two years later, nabbed the CFDA award for Accessories Designer of the Year. Then, in early 2008, Labelux, an investment firm with a portfolio ranging from Jimmy Choo to Peet’s Coffee & Tea, swooped in with big plans and deep pockets. But the recession and differences of opinion spoiled the partnership after four years. “I always said that if it was all to go, I’d still be a creative person. It wasn’t going to be the end of my life,” Lam says.

Nevertheless, he and Schlottmann bought back the company and trimmed the fat. They closed the high-concept downtown store that was opened with Labelux’s help in 2009, relocated the showroom to a more affordable part of town and pared down the runway shows to about half the size at a small art gallery. Lam considered skipping a show altogether but recalled the wisdom of his former boss, Kors, who has gone from bankruptcy to billionaire. “Michael said, ‘You have to show. It doesn’t have to be the same scale, but you have to be part of that cycle,’ ” he says.

Also in that same year, Lam left his post as creative director of Tod’s, where he’d been since 2006. The job had put him on a more global stage but presented its own set of challenges. “It’s really hard to do that many seasons,” he says. “And at the end of the day, I want to be known for Derek Lam. The whole point of starting this was to build our own world.”

How that world is defined is something that Lam and Schlottmann discuss constantly. “We talk about our company, about the people we work with, our vision, our dreams, what we want to do tomorrow, what we want to do in three years, what we want to do in five years,” Schlottmann says. “There’s something to be said for being able to come home and say, ‘Oh, honey, how was your day?’ but this works for us.”

The couple, married in 2012, seamlessly divide up the business. “I get the role of the creator; he gets the role of the facilitator,” Lam says. “It comes down to who’s going to take the lead.” Even though Lam’s name is on the door? “Sometimes you play that card—jokingly but not so jokingly,” Lam says with a smile.

“This business is like our child,” he continues. “Sure, there’s that moment where you just decompress on your iPad—he watches House of Cards, I watch Veep—but if we’re facing each other, we talk about work. You can’t turn it off.” That’s not to say they don’t try. Recently, the couple adopted an Irish terrier, Roscoe, and they take timeouts by retreating to their beach house on New York’s Fire Island or traveling to the Caribbean, southern France or Hamburg, Germany, where Schlottmann has family. (More comfortable living out loud, Schlottmann Instagrams these trips, as well as photos of Roscoe. One recent caption read, “@dereklamnyc emailed me this morning that I post too many pictures of #roscoelam.”)

If only Lam were a little more reality-show-ready, Schlottmann jokes, the road to success might have been quicker. “Sometimes it’s harder to put the business into a sound bite,” Schlottmann says. “But that’s why the product is so important, because that’s what informs the consumer about Derek Lam.”

Which is exactly how Lam likes it. “The people I find most intriguing are the ones you don’t know too much about,” he says. “To me, that’s fascinating.” www.wsj.com