Hi there, and welcome back to Line Sheet. First things first: I’m taking a little holiday break and will not be publishing on Monday. (God bless us, every one.) I’ll be back next Thursday with a special mailbag issue.

The theme of today’s email: Hey, whatever happened there? Indeed, I have updates on a whole slew of characters floating around the Line Sheet cinematic universe: more details on the Matches sale, Farfetch, and the overall state of overfunded fashion e-commerce companies; murmurs of movement at Banana Republic; a development in the story of our favorite Naadam-adjacent brand, Something Navy; and the latest in the never-ending Outdoor Voices saga.

P.S. If you or one of your clients are named in those Jeffrey Epstein court documents set to be released January 1, feel free to get in touch. I love planning ahead!

Mentioned in this issue: Matches, Ashley Merrill, Jim Gold, Farfetch, Outdoor Voices, Arielle Charnas, Matthew Scanlan, Something Navy, Richard Dickson, Lauren Santo Domingo, Gap, Sandra Stangl, Tyler Haney, Banana Republic, and many more.

• Nike sued an influencer: Last week, the sneaker maker, which currently has a market cap of about $185 billion, sued some influencer kid named Eben Fox, who goes by Cedaz, for “brazenly” promoting and selling “counterfeit Nike goods on his social media channels.” Fox lives in New Hampshire, at least according to his Twitter profile—my guess is Nashua—and has the face of a big baby. But he “apparently believes he can engage in this illegal conduct with impunity,” reads the complaint, filed in a Florida court.

  Fox seems to do a lot of his business on Discord. I hope this scares the bejesus out of him and he can go on to live a crime-free life. As for why Nike bothered nailing him: I guess it’s always good to make an example of someone with 149,000 Instagram followers. (Thanks to my Puck partner Eriq Gardner for bringing this case to my attention. You should sign up for his private email, The Rainmaker, if you love legal drama, especially when it involves billionaires and celebrities.)

• Why is there a $450 leather bomber on the Banana Republic Factory website?: Not saying this is why the Gap Inc.-owned retailer is struggling, just asking a question. The gossip in San Francisco, though, is that Banana Republic president Sandra Stangl is definitely on her way out, with an announcement potentially happening by the end of the year. (I find that unlikely, but then again, the last working day before Christmas is a favored dumping ground for important news.)

  There are also plans to wind down Banana Republic Home, her big project, my sources say. Net sales at the brand, which was doing pretty well a couple years back after a repositioning, were down 11 percent year-over-year in the most recent quarter. Sales at stores open at least one year were down 8 percent. A Gap Inc. spokesperson did not respond to an email request for comment.

  As I’ve previously written, group C.E.O. Richard Dickson needs to do some drastic overhauling in order to right this ship. Athleta has a newish team in place, Old Navy is better off than the others, and Gap—whose executives Dickson met with in New York on Wednesday—is the toughest thing to fix.

• Something Navy’s nothing price tag: When a company gets bought for “$1” or whatever, the extra baggage—operating costs, debts, legal headaches, etcetera—usually costs far more. In the case of Something Navy, the apparel brand started by an angel of an influencer, Arielle Charnas—now part of the Naadam Group, a collective of mostly defunct businesses founded by fashion’s least-favorite fundraiser, Matthew Scanlan—that’s about $7.5 million in liabilities, according to a recent report in WWD. Something Navy’s new owner is likely to be IHL Group, a New York-based firm that manufactures and distributes clothing for brands including Jason Wu, BCBG, and Tahari.

  As of earlier this week, a deal had yet to be signed, but I hear Charnas has been in talks with IHL for as long as she has been trying to sell the brand, which went black on social media 22 weeks ago after launching a collaboration with the Mattel-owned doll company American Girl. (Okay, it actually makes a lot of sense—many of Charnas’ followers are also moms of young kids—but that’s a conversation for another time.)

  Selling to IHL is a drippy way to go out—sounds like Charnas will have minimal involvement from now on—but let’s give it some context. Charnas has been compared to Tory Burch thanks to her high style’s mass appeal. But when the partnership with Scanlan and the Naadam Group went south, Charnas did the right thing and distanced herself from Something Navy. If she wants to start a new brand, with a new partner, she still can. And given the response to Something Navy in the early days—the brand once sold $4.4 million worth of product in one day—it would probably be a hit.

It took about 12 months for this executive’s prognostication to come true. Earlier this week, the Matches fire sale finally went down. A company that was once worth $1 billion traded hands for $63 million. This news arrived just one day after competitor Farfetch, once worth $23 billion, was bailed out by South Korea-based e-commerce group Coupang with a $500 million loan.

Why did Matches succumb? Yesterday, I pulled it up on the public business registrar in the U.K., my beloved Companies House, to find that, according to the retailer’s most recent filing, it made £380 million (about $480 million) in revenue in the year ending January 31, 2022, essentially flat from 2021. It lost about £34 million ($43 million) on an adjusted EBITDA basis. Close to $500 million in sales sounds just right to me for an online luxury department store, but who knows what happened this year with spending in the sector slowing overall. The debt load must have just been too great to service.

Mytheresa, the Germany-based player that went public around the time Farfetch’s stock was soaring, in January 2021, is probably the best off at the moment—even if its stock is down 90 percent from its I.P.O. In its most recent financial year, net sales surpassed $768 million, with a reported loss of $15 million. The company has a good amount of cash reserves on its balance sheet to sustain minor losses like that for a while, although its status once again begs the question: How big should these businesses be, and how can they achieve profitability in most years? (It’s almost inevitable in retail that some years will result in a loss, but not most.) The answer will inevitably be consolidation, although that won’t solve every problem. Where there is brand value, like in Matches and Net-a-Porter, there will always be some arrogant investor who believes one plus one might equal three.

Looking back on this year, a tough one for fashion, it wasn’t just the luxury e-commerce players forced to face reality. Rental, subscription, and secondhand businesses also continue to struggle to convince their shareholders that they are capable of profitability. Many of the direct-to-consumer players are suffering, too, and fading away even more quickly. The difference between the aforementioned service providers and D.T.C. brands is that the former do indeed provide a service that is valuable to the customer, even if the business model doesn’t quite work. The brands, on the other hand, are quick to become commodities in the eyes of fickle consumers.

And yet, some of them just won’t die. For instance, Every time I write about Outdoor Voices, I am convinced it will be the last time I write about Outdoor Voices until it inevitably goes bankrupt or is acquired by an Authentic Brands Group-style licensing company. Not so. This week, I got word from various sources that Outdoor Voices did indeed almost go bankrupt earlier this fall, but that Oakwell Capital, one of the brand’s lead investors, was able to broker a deal to sell it to another investment firm.

The twist: At the last minute, Ashley Merrill, who swooped in to bail out the brand back in 2020, resulting in the exit of its founder and mastermind Tyler Haney, ended up doing the deal herself, and is now running the business. (Merrill, a serial investor, is also the founder of the D.T.C. pajama brand Lunya.) President Gabrielle Conforti, who joined from Urban Outfitters in 2021, left in November. (Neither Oakwell, Conforti, nor Merrill responded to my request for comment.)

When I texted with Merrill over the summer about Outdoor Voices’ troubles, she thought it was unfair to compare the brand to Alo Yoga—which, you might remember, has been trying to raise money at a $10 billion valuation. “The only reasonable comparison between Alo and OV, historically, is the fact that they were also a company that has spent an astronomical amount of money on marketing and have run a highly unprofitable business,” she told me.

The funny thing is, I’ve heard Merrill is telling employees that following the Alo Yoga playbook doesn’t seem like such a bad idea right now. Sigh. In the cases of Net-a-Porter, Matches, and Outdoor Voices, there is a hope, or a dream, that the respective founders—Natalie Massenet, Tom and Ruth Chapman, and Haney—might return to save their beloved businesses from ruin. Would it work? Doubtful. Good entrepreneurs know when to bail. I’d like to believe that the fashion industry is in the midst of a much-needed correction, and that the challenges ahead in 2024 will force companies to operate in a more realistic way. But the truth is that it’s a never-ending cycle, and fashion, like many businesses, is driven by ambition and ego. Logic is an afterthought.

Also on the Farfetch deal: “This is pretty crazy (even Naver acquiring Poshmark was kind of random but not). Korea is the new Japan but possibly with more ammo as soft power re: entertainment (music, film, TV influence).” —An e-commerce exec

One more: “I can’t help but picture an Apple TV movie à la WeWork about Farfetch. Who will play Neves though? Can it be Oscar Isaac please please?” —A comms strategist (My response: José is too nice to warrant a TV show.)

Re: Kristin O’Neill’s new title at Sotheby’s not being “chief content officer”: “Especially heartening because in my experience brand/company people have zero idea what that title signifies.” —A chief content officer type

On Cartier developing makeup: “Soooo interesting about Cartier. I lean toward skincare before makeup, only because skincare has more of a lifestyle angle (a Cartier spa in Paris—omg) but totally hear your point re: real expertise. TikTok has made everyone an expert on ingredients, you really have to do it right.” —A marketer

On the state of WWD: “It wasn’t until BoF launched (and in classic Condé style, underestimated) that there was a real shift in the business for WWD.” —A publishing exec (N.B.: Advance, Condé’s parent company, used to own WWD through its Fairchild group. In fact, Gina Sanders, Steve Newhouse’s wife and the former publisher of Teen Vogue, used to run that business.)

For foreign companies, does it make sense to I.P.O. in New York anymore? [Bloomberg]

Balenciaga is in the water again, with a Kaitlin Phillips endorsement and this artist in St. Louis. [Magasin and T]

What Shein’s strengths say about Amazon’s weaknesses. [NYMag]

Jacquemus president Bastien Daguzan is leaving the company. Let the late December news dump begin! [WWD]

And finally… Okay, the gift guides need to stop now. Thank you for your service.