Acquisitions, bankruptcies, and consolidation
In recent years, we have had to say goodbye to several established and recognized fashion companies due to closures and bankruptcies. However, many fashion brands have either been acquired or brought in new investors, which have provided a financial foundation and secured a new chapter in the company’s history. We have interviewed several industry players who have been part of either an acquisition, a bankruptcy, or have welcomed new investors. This is also the story of six individuals who have tackled the different crises in the industry in their own way.
By Lindgren: “We were shocked and heartbroken to suddenly lose ur life’s work”
In May 2023, the children’s clothing company By Lindgren declared bankruptcy. In just a few years, they had gone from a successful start with high demand to the heartbreaking reality of having their bank accounts frozen and the administrator taking over. However, the bankruptcy did not mark the end for Katrine and Anne Lindgren, who managed to revive the company in a new format.
“Do you believe in this yourselves?” The question from their bank’s new advisor hung in the air. Katrine and Anne Lindgren sat in their accountant’s office, unsure how to respond. It was April 2023, and although they had faced financial challenges, they never imagined the situation would become so dire.
“We had experienced growth most months over the past year, but the bank had lost confidence in us,” recalls Anne Lindgren.
Just days later, the bank accounts were frozen without warning, forcing them to file for bankruptcy shortly after.
“We didn’t see it coming – neither us nor our investors – and suddenly, we were living our worst nightmare,” says Katrine Lindgren.
The bankruptcy marked a low point in the sisters’ entrepreneurial journey, where their passion, shared dreams, and family business were effectively shut down in a short meeting. However, the story of By Lindgren and its founders, Katrine, and Anne Lindgren, is also a window into a strained industry and a tale of passion, perseverance, and the determination to start over.
The reality of a dream
It all began in 2015 when Katrine Lindgren, on parental leave, saw a gap in the market for practical and aesthetic outerwear for children.
“I couldn’t find thermal wear for my daughter that I thought looked nice,” explains Katrine.
With support from her older sister Anne, the two began developing their first products. The idea was simple: to create stylish outerwear with a focus on design and fit. When they launched their first collection, demand was overwhelming.
“We could hardly keep up, and the collection sold out quickly,” says Anne Lindgren.
Over time, the business grew, securing major retailers like Kids-World, Boozt, and Zalando. However, COVID-19 and the subsequent invasion of Ukraine fundamentally altered the market dynamics, causing significant challenges for the children’s clothing company from Sæby in Northern Jutland:
“It became extraordinarily difficult to navigate the children’s clothing industry that we thought we knew so well. We were thrown into a harsh industry where we often felt small and inexperienced. Retailers began demanding more in terms of color selection, pricing, and delivery terms, making it hard to stick to our original business foundation.”
While By Lindgren’s webshop performed well, disrupted supply chains and delayed payments from retailers strained liquidity, creating an increasingly precarious situation.
The chaos of bankruptcy
“In just a few days, we had to make the toughest decisions of our lives – not just as business owners but also as mothers and sisters. We were shocked and heartbroken to suddenly lose our life’s work.”
This was the message Katrine and Anne Lindgren posted on their company’s Facebook page on May 23, 2023.
In the days leading up to the official bankruptcy filing, they did everything they could to keep the business afloat:
“We were never given the chance to prove our worth because the bank kept turning us down. We presented so many new strategies, and our investors – who at the time owned 20% of the business – were willing to buy us out. But the bank wouldn’t allow that setup. They didn’t give us any options, and we filed for bankruptcy against our will. It was the hardest thing we’ve ever experienced. We felt utterly powerless,” says Katrine Lindgren.
Despite the chaos, the sisters experienced an outpouring of support from customers and their local community when they announced the company’s closure sale. Their social media post sparked a “love storm,” and on the first day of the clearance sale, they generated one million kroner in revenue. But it was an emotional rollercoaster:
“It was incredibly tough to go to work and pack hundreds of orders knowing it would soon be the last. Eventually, PostNord stopped picking up packages because the bank didn’t pay the bills, and we no longer had access to our accounts. We never knew what we’d face each day. On top of that, the administrator dismissed our wonderful employees. We felt like failures in every way. Being a local company, even going to the local grocery store was hard. But actually, it was the opposite – people gave us hugs and bought our products,” Anne recalls.
As the clearance sale raced ahead and the bankruptcy proceedings with the bank, administrator, and court went full steam, Anne Lindgren reached her breaking point:
“I was completely burned out. I couldn’t sleep, lost track of time, and didn’t know if we were coming or going. Our company – our baby – had become a commodity up for sale. We saw significant interest from buyers wanting to acquire the bankruptcy estate. It felt like a total loss of control. Who would make the highest bid to the administrator? Some were only interested in the brand name, and I thought, ‘Please don’t bid; leave it alone.’ I didn’t want it continuing under our name without us.”
A new setup, a new focus
Amid the aftermath, the two investors, Henrik Rud Jensen and Jens Juul, who had been minority shareholders in By Lindgren, successfully acquired the bankruptcy estate after discussions with the sisters.
“We didn’t believe it until the deal was officially confirmed and we saw the new company registration number. It felt surreal after so many obstacles,” says Katrine.
In September 2023, By Lindgren reopened in a smaller format, focusing solely on direct-to-consumer sales via their webshop and a streamlined selection of seasonal and timeless outerwear.
“It’s a slightly different business we run today. Initially, we weren’t sure if our customers would need more By Lindgren outerwear after the clearance sale, but we’ve been warmly welcomed back. In some ways, we’re back where we started, with just Anne and me on the payroll,” says Katrine, adding that the post-bankruptcy period has required major adjustments and reprioritizations:
“We’ve both taken medical leave for stress-related issues after the ordeal and have naturally taken time to reflect. We still love our work but have found a much better balance between work and family life,” shares Anne Lindgren.
Much has changed, including ownership, strategy, and a focus on long-term development:
“Our investors made an investment of the heart. We don’t aspire to be a big player in the industry. We’d rather be a small, solid company doing things our own way,” says Katrine.
“By Lindgren has meant everything to us, but today, we’ve moved past the bankruptcy and are in a good place. By Lindgren remains a big part of our lives – fortunately. But it’s not everything.”
