👉 Background: Dolce&Gabbana is the Italian luxury fashion house that was founded in 1985 and has been worn by the likes of Beyonce, Scarlett Johansson, Kylie Minogue, Kim Kardashian, and many more. While D&G generated more than 1.87 billion euros in revenue last financial year, it’s still owned by the two founders and their families.

👉 What happened: After many approaches and rejections, Dolce&Gabbana has said that it’s finally considering a stock market listing and opening its doors to bring in “third party investors”.

👉 What else: But this announcement came with a warning: Dolce&Gabbana will “not compromise the ethical value of its company” in order to secure financing and even said they want “respectful growth”. Not the growth-at-all-costs expected by many investors.

What's the key learning?

💡When a company’s owners choose to bring in additional shareholders, they often need to sacrifice creative control for shareholder profit.

💡A public company is obligated to its shareholders, and often that means prioritising profits above all else and this is the risk Dolce&Gabbana runs if it chooses to list or take on other forms of external capital.

💡We’ve seen what happens when a fashion brand gets caught in the tug-of-war between profits and maintaining exclusivity. After Gucci was acquired by Kering in 1999, its image as a luxury brand has slowly dropped:

• Gucci has been accused of chasing trends
• Its revenues in the first quarter this year are expected to be down by 20%.