So, before the break we'll close with a roundtable and talk about finance. So I'd like to call Giovanni Tamburi, who is founder, chairman and chief executive officer of TIP Tamburi Investment Partners, and Walter Ricciotti, managing director of Made in Italy Fund 2.
Wherever you'd like, I'll be on the left. Hi.
Here we are. So, finance understood as investing in companies to accelerate growth, to support growth. Giovanni, you who have operated for many years across many sectors, what is your vision of this furnishing sector where you have the investment in Dexelance, which is one of the very few Italian companies listed on the stock exchange?
First of all, thank you for the invitation and especially for this escalation this morning, because I found so much music for our ears in the data. When Gilda mentioned Maria Porro on the value of cohesion — I've been building things for 50 years trying to capitalize on value creation. I've done it in many sectors and so on. Then we saw topics like those of Marco Mazzucchelli on the complexity of the supply chain — these are all things that connect very well together. As you well know, I have a passion for homes, I always have. I wrote my thesis on similar topics many years ago, which is how I started with this thing. The passion gradually took hold. Over the years I tried to do deals, some I did, some I didn't, and we arrived at Dexelance — or rather we arrived at Ital Design Brands, which we deliberately renamed to Dexelance, precisely to send a particular message, because this is a sector — I won't repeat the enormous things — Italy is incredibly credible, we are very good, we are among the best in the world, perhaps the best in the world, but we are dwarfs. Seeing that Dexelance, which was born relatively recently, appeared in the top positions in two of the rankings you showed before — it makes an impression, but it's laughable. We all laugh, in the sense that we are all small companies — the largest we've seen is Molteni with 500 million, and honestly, looking at other sectors, so much more can be done.
How can it be done and how have we tried to set up our project — because ours is truly a project, not a company, not a group, not a holding, not a fund. We do the opposite of what funds have been doing for 50 years, and we are happy to apply this approach to this sector. We believe that an intelligent aggregation of ambitious companies that want to grow can solve, in part, all the problems we've discussed so far — fragmentation, digital, distribution. We've just heard about distribution, and indeed we are, so to speak, slave to distribution as manufacturers, because we have these thousands of dealers who carry 30, 40, 50 brands, and if you're not among the strongest, most credible, and so on, you're just one of many, and it's very difficult. So I believe the first pillar of our project is giving companies the strength to be more powerful in the market. Then there are the derived benefits — attracting talent, because it's clear that in a family company, perhaps with two or three family branches that by the second or third generation aren't even perfectly aligned, the good manager won't go there, and this is truly very important. So great strength on distribution, great desire to give credibility — also because, as Mazzucchelli explained very well before, we need to make enormous investments, and with the dwarf companies we have, we can't make these investments. Digital — he rightly insisted a lot on technology, about which little is said, but so much can be done. Building a beautiful configurator for a fine company is difficult, it's expensive, and if you have 20, 30, or 40 million in revenue, you can't afford it.
The showroom in New York — Gilda mentioned earlier all those on Madison Avenue. Dexelance isn't yet on Madison Avenue, it's nearby, but why? Because it got there with its strength of 300 million. We hope to move toward Madison Avenue when we grow a bit more, but most of the individual companies we've brought in — if they had put their showroom there alone, they would never have arrived even there if we hadn't been the ones to do these things. So the project means exactly that — an enormous respect for the individuality that we want to preserve, as I've done in many other sectors: the entrepreneurs, the management, the brand of the company. Not consolidate or do those famous synergies that are often shown to be more harmful than anything else. So respect the company, generally never take 100% under the form of consolidating it, absorbing it and homogenizing it into the rest, but leave the entrepreneurs as shareholders, or tell the entrepreneurs, why don't you move up and come into Dexelance as a company, so we can do this project together. Therefore, in the case of Roda, which we are announcing the final signature on in these hours — complete continuity of management. We are not the buyers who say, I'll put Mr. X in charge because I'm smart, or find the smartest one like picking a football player by the head. We leave everything to them, their responsibility. We give everything that is possible, generally for free as the parent company, but leave great room to move forward.
Very clear. Walter Ricciotti, you are — it's a private equity fund, so the opposite, as he said. What kind of vision do you have and what investments have you made in this sector?
Well, first of all, I'd say that finance in general, in various forms — funds, longer-term investors — has made a contribution and is making a contribution that I think is very important. So let me do a bit of advertising in favor of finance, which is sometimes treated poorly, because I must say that in various forms, with various instruments, the problem of the dwarfism of Italian companies that Giovanni Tamburi spoke about — which in the furnishing sector is perhaps even more pronounced than in other sectors — finance is contributing, and three of the main Italian groups were born from private equity initiatives. They had subsequent phases, became part of industrial groups, are listed, had different paths. So let's say finance has always looked — and we in particular, since we have two funds dedicated to Made in Italy — have always viewed the furnishing sector as one of the most interesting sectors. I must say that when we launched the first Made Italy 1 fund in 2018 — now we've launched the second last year — we looked not only, as we've seen and continue to see, at investment opportunities in brand production companies, but we also looked closely at the distribution sector.
In this sector, distribution is a particularly interesting part of the value chain to invest in. I say this because distribution is extremely fragmented, as we all know, and much more complex than in other lifestyle sectors. If we compare it with, say, clothing — clothing is retail, single-brand, wholesale, online. Simple. The furnishing world is much more complex. There's the whole contract part, the whole architect part — the fact that single-brand stores have only spread in recent years and are still growing, so the multi-brand wholesale is much more important. Online developed here later as well. So I must say all these aspects led us to see great value not only in brand production but also in distribution, and in 2019, before Covid, we found in Molteni and in the entrepreneur Gianluca Mollura the ideal partners to invest in, and we're very happy with the path we've been on for several years now.
On the other hand, if we also compare with other lifestyle sectors, and also the trend in the furnishing sector — if we look at what has happened in the last five years, how many companies are investing either through internal development or acquisition in the distribution sector — it's what happened in the clothing sector. Let's take an example, not always talking about clothing — let's look at what Luxottica did. Luxottica made a very strong journey of vertical integration in distribution, and so we see an increasingly close connection between production and distribution, which until a few years ago were totally separate and are now drawing closer, also because proximity to the end consumer is increasingly important.
Clear. Giovanni, I wanted to come back to the concept of this aggregation — on one hand it's very clear the point about preserving the identity of the brands, but at the group level, where are the synergies, where do you find that 1 plus 1 equals 2 and something more, where do you work, and where is it harder to extract them?
So, let's start with where we don't look for them. We don't look for them the way many holdings, many groups, and many operators do in a more industrial consolidation or financial logic. We don't cut financial directors, personnel costs, HR directors — we don't build a cohesive group. So the structures remain, let's call them duplicated, totally autonomous, and this does create diseconomies, there's no doubt about that. Where we do provide value — first, we have a central structure in digital and technology that can help companies enormously. Generally, as I was saying, we give individual companies free access to these things: the configurator I mentioned earlier, digital marketing, relationships with clients, with architecture firms, and so on. If you organize this well at the central level, you add enormous value to the company. On retail — many manufacturing companies have their showroom perhaps shared with a distributor and so on. We have a central team that can advise individual companies: it makes sense to do this, it doesn't make sense to do this, it's better to do it here, it's better to do it there, and so on. Not only that, but we've seen that since we brought in a particularly talented person for retail, we've changed the structure of stores and points of sale for companies that were already there, giving more effectiveness, giving a sensitivity that — if you're Davide Groppi, the best producer of certain types of lights perhaps in the world, you don't necessarily have that sensitivity to say, I'll put this in the window.
For example, I saw that when Davide won the Compasso d'Oro, he left the Compasso d'Oro in two windows for a certain period, which is an important positioning move. It's certainly a particular kind of marketing, so we discuss these things, about people. Clearly, the talented manager in a company with two, three, four family groups — with all due respect for family businesses worldwide — often hesitates to join certain companies because the eldest protects the youngest, or the son of one family branch who may be more skilled but the other family branch holds more shares, so this one has to stay in Serie B a bit. We help attract talent first by giving a sense of professionalism to the company, which is very, very important. And we see that the number of résumés arriving at Dexelance every day is impressive in a sector where there are relatively few people — many entrepreneurs but few managers and so on. Another element is on service, because Mazzucchelli also explained this very well — when you have a wonderful product and so on, but the installer in Miami messes up the kitchen installation, you lose your face, you lose your reputation, and so on. If as a company with 300, 400, 500 million in revenue you can say to the installer, I guarantee you this type of work flow, I won't call you — and it might cost me a thousand euros a day for a certain type of work — well, that's very different. So from the service standpoint, which is the Achilles' heel of most companies in this sector, especially for complicated products — certainly not for the sofa you just deliver, but I was citing the kitchen as an example — this is very important. We provide all these little pieces of help, and then of course there are commercial synergies, synergies of exchange. The beauty is that with many entrepreneurs who by definition are alone in their companies, we give them the opportunity not so much to receive input — because there's no presumption to say we're the smartest and we'll teach you something — but to have the chance to talk and compare. Should I accelerate in Miami or Toronto? Now with the tariff issue, everyone's panicking — stop a moment, how do tariffs work, let me study them well for you, I'll give you a hand with that too.
