Philly retail billionaire Michael Rubin sells an e-business, but buys a U.S. factory
Michael Rubin sells ShopRunner while Fanatics buys WinCraft. Rubin also sold a piece of Fanatics, which suggests that firm is worth over $6 billion, well into unicorn territory.
It’s been a busy December for Michael Rubin, the Main Line retail billionaire and part-owner of the 76ers, who made his mark and his money in e-commerce.
He’s been shifting his focus, moving away the internet and and turning his attention and his purchasing to old-fashioned manufacturing.
So it is that at the start of the month, he sold ShopRunner, his Chicago-based online-shopping platform, to FedEx. ShopRunner helps such firms as American Eagle and Kate Spade & Co., sell online by taking care of such basics as shipping and returns.
Less than a week after that, Rubin announced he was buying WinCraft, a Minnesota firm whose factories for 60 years have been turning out items emblazoned with the logos of pro and college teams, including signs, pennants, and much more.
The firm is a good fit with Rubin’s Fanatics, his 7,500-employee online operation based in Jacksonville, Fla., that is the dominant force in the lucrative business of selling goods tied to the world of sports.
Rubin didn’t reveal how much he paid for WinCraft or how much he received for ShopRunner. Still, he did disclose this summer that he had sold a 5.6% share in Fanatics to investors for $350 million. That suggests a total value for Fanatics of more than $6 billion, which would enable Rubin to brag that he owns a “unicorn,” a private company worth billions should he sell it or take it public.
Outside investors in Rubin’s Fanatics now include Japan-based Softbank, whose Philadelphia-backed enterprises also include another “unicorn,” delivery service goPuff; China-based Alibaba, the e-commerce giant; and the NFL, Major League Baseball, and other sports leagues who are Fanatics clients.
After the August buy-in by investors, Fanatics also purchased Top of the World, an Oklahoma-based maker of caps and scarves for colleges. The deal rescued Top of the World from liquidation. The purchase saved its factory; Rubin’s managers called back 200 laid-off employees and restarted production.
Though the privately owned Rubin empire didn’t disclose what was paid for WinCraft or Top of the World, his representatives did say the money to buy both came from the $350 million in fresh investment funding.
In 2017, in an early move into manufacturing, Rubin bought another threatened U.S. manufacturer, Majestic, which makes Major League Baseball uniforms. Local officials said the purchase saved 600 jobs in Easton, Pa.
Going forward, the current heads of WinCraft and Top of the World will keep their jobs, too, but will report to Molly Adams, the new Fanatics chief integration and transformation officer who previously worked at Disney. Besides making products for top teams, WinCraft has also produced goods for Hollywood studios, the Olympics and World Cup, retail chains, high schools, and others.
After establishing Fanatics as a leading online supplier of NFL, MLB, NCAA, and other sports gear — its flagship NBA Store is on Fifth Avenue in New York — Rubin has said he plans to expand “vertically” with plants in the United States to actually make the stuff he sells. His holding company, Kynetic, is based in Conshohocken.
The moves have made Fanatics increasingly a homegrown manufacturer after years in which much production of clothing and many basic goods has been outsourced to China and other lower-cost countries.
Rubin, whose firm said he was not available to discuss the recent deals, has had an increasingly prominent public profile. He partners with Josh Harris, a billionaire investor, in owning 76ers.
He has taken on a string of highly publicized causes, rallying behind Philadelphia rapper Meek Mill as he faced legal issues stemming from an old arrest and joining him in pushing for criminal-justice reform.
In 2011, he and his investors sold King of Prussia-based GSICommerce, an e-commerce enterprise that battled Amazon over online sales by retail chains and other businesses. EBay paid $2.5 billion for GSI.
Fanatics, ShopRunner, and Boston-based RueLaLa, which offers shoppers online discounts at high-priced chain stores, were the three units Rubin held back for himself at that time. RueLaLa last year acquired rival Gilt, and now operates the businesses together as Rue Gilt Group.