The Focus Group

CNBC Business Magazine, May 2012 Issue (Cover Story)

A Berlin eyewear company dedicated to innovation and tradition has become the darling of the über-cool

At first glance the business occupying four floors of an ex-blacksmith’s in the heart of the former East Berlin could be yet another trendy tech start-up. As well as the obligatory foosball game, there are benches and a long table for communal lunches, and hundreds of Polaroids of its hipster employees line the walls in a blur of piercings, tattoos and beanies.

Yet on closer inspection something more interesting is going on inside. Grouped around work surfaces, men and women are carefully assembling thousands of pairs of glasses by hand.

This is the red-brick nerve centre of the über-fashionable MYKITA eyewear company, established in 2003 and a fixture on catwalks worldwide, not to mention a favourite of Lady Gaga, Brad Pitt and Angelina Jolie. Founded by four young men from the small German city of Oldenburg, last year it had a turnover of €16m and sold more than 160,000 frames – every one produced in the so-called MYKITA Haus. “From the beginning our products were based on cutting-edge technology coupled with traditional hand assembly,” says CEO and creative director Moritz Krueger, who at 32 is the company’s youngest founder.

The original product was the brainchild of Philipp Haffmans and Harald Gottschling, who met while studying industrial design. Working on a project at Berlin University of the Arts, they hit upon the idea of making glasses based on the Japanese art of origami. Rolling the end of the frames into a spiral, and clicking it together with a spiral or coil on the temple, they produced hinges that had no need for soldering or screws. Enamoured with this design, they decided to form a business, bringing Krueger and Haffmans’ architect brother Daniel on board as partners and setting up shop in a former kindergarten known colloquially as ‘kita’ – hence the German-English hybrid name MYKITA.

The quartet assembled a team of 20 and began producing their first stainless-steel frames, launching a debut collection of 30 models at the Salon International de la Lunetterie, Paris, in September 2004. Buoyed by the reception they had received, in 2005 they launched their first sunglasses collection and quickly outgrew their kindergarten premises – prompting them to move the following year into their current headquarters: a back courtyard on Brunnen Strasse, a stone’s throw from where the Berlin Wall once stood.

The process of establishing the company meant a steep learning curve for everyone, Krueger admits. “We were starting from a naive point of view, but then later we understood the values, the advantages of doing things that way,” he says. Indeed, it was their determination to do things their own way and learn as they went along that led to their unique production methods. “We are an extremely auto-didactically driven company,” he adds. “We didn’t have the experience, so we just tried to think logically while always listening to our hearts.”

As their method of making specs was new, and the equipment they required didn’t exist, they needed an engineer to help them design and build original tools and machines. This soon evolved into a core philosophy, so that as well as manufacturing, the marketing, PR, packaging and even the interior design of stores are coordinated from the Berlin HQ. This is highly unusual in the designer eyewear field where, typically, the manufacturing is outsourced to a cheaper country such as China.

Krueger concedes that the company will never be competitive in terms of production costs. While its glasses are not cheap – typically they retail for €160-€600 – their profit margins are much lower than those of other designer brands owing to the intensive work that goes into them. This is also an intrinsic part of their identity, however. “I think it’s a strong USP for us that we really have our own in-house production shop,” he says.

Inside what the company calls its “modern manufactory”, about 120 people are scattered across two floors, rolling, bending and polishing. Each member of staff has to be trained for several months, explains company PR manager Lisa Thamm, who frequently conducts tours around the premises. But they must already have a facility for delicate tasks and close attention to detail. “We have people working here who are trained goldsmiths, dental technicians, who have a ceramics background or have worked as optometrists before – all jobs where you have to be very skilful with your hands,” she says. “It’s all about the hands.”

Inevitably, the workers become increasingly dextrous the longer they have been there, making bending and folding the frames and temples look almost easy. Mirko, a bearded thirtysomething sitting at a table in the steel frames section on the ground floor, puts it all down to practice. “There is now a pool of experience,” he says. “You know which skills and which machines are the best for which models.” MYKITA has also branched out into acetate, a traditional material for eyewear, and in 2007 bought a traditional acetate eyewear manufacturing company. These days, 24 workers there pre-produce frames in an industrial process, after which the parts are sent to Berlin to be bent into shape, assembled, adjusted and finished by hand.

Being in one of the world’s coolest cities doesn’t hurt the brand. It has also helped to keep costs down, as the German capital is relatively cheap in European terms and can tap into a deep creative talent pool. At the moment, people from 18 countries work in the MYKITA Haus. But while the city is central to the way it operates its business, Germany is only its third-biggest market, lagging behind the US and France.

Now the company has another line of products, this time intended for the fastest-growing sector in fashion: luxury sports. This has been made possible by its latest breakthrough material, Mylon, which is made from polyamide, created using selective laser sintering (a manufacturing technique that fuses particles into whichever three-dimensional shape is desired) and finished in a patented six-step process. It is 40% lighter than acetate and far more durable and flexible, making it particularly suitable for sports eyewear, the company says. What is more, the frames can be thermally adjusted (that is, warmed up and bent) to fit the wearer’s head.

The products are designed for both active sports and casual leisurewear, and the first Mylon collection launched last November. All seven models have a hydrophobic nano-coating, developed by venerable German lens manufacturer Zeiss, which makes water roll off the lenses. Zeiss also developed a golf lens for the range that is colour-adjusted to increase the contrast on the green. At the same time, Mylon has enabled MYKITA to forge a partnership with the Franco-Italian sportswear company Moncler, which specialises in high-end down jackets. Reminiscent of old-fashioned snow goggles, the MYKITA & Moncler glasses launched last December come in blue, black and red. They are named Lino and Achille in a tribute to the first men to reach the summit of K2 in 1954, in an expedition that Moncler supplied.

MYKITA is also known for its work with acclaimed fashion designers such as Agathe Snow, Alexandre Herchcovitch and Kostas Murkudis. It views such collaborations as a ‘playground’, unencumbered by the commercial restrictions it normally faces. According to Krueger, MYKITA likes to work with its partners as equals, rather than – as happens in other collaborations – just having its logo appear on someone else’s products. “We are trying to bring both our creative DNAs together,” he explains. “The most important rule is that we only start collaborating with a partner when we are convinced we can make an item that is truly new.”

One of its first joint projects was with the funky, Berlin-based cosmetics company Uslu Airlines, whose state-of-the-art colours and brushes have made it another favourite with fashionistas. Together they created the Jet Set, a travel pack containing a pair of aviator glasses and a matching nail polish. Meanwhile, specially designed Uslu Airlines nail polishes are available in all of MYKITA’s stores. The collaboration works well because both have a “global approach” and are “innovators in our fields, doing things that others said are not possible”, says Uslu Airlines’ co-founder, Jan Mihm. “MYKITA does many, many things that other sunglasses or frames brands don’t do and so do we. And that fits well together.”

According to Mihm, it was Uslu Airlines that put MYKITA in touch with the fashion designer Bernhard Willhelm after he had curated a line of nail polish for the company. In 2009, he designed an eyewear range that included the Franz sunglasses, which increased MYKITA’s profile massively the following year when Sarah Jessica Parker wore them in Sex and the City 2. Many companies would have jumped at the chance to exploit that kind of attention, but Krueger insists that it is simply not part of MYKITA’s gameplan. “Of course we could push with this one model extremely hard in the marketing and try to sell as many as we can and increase our production in the short term,” he says, “but it’s not a lasting strategy.”

Instead the company has to be careful to emphasise that there is more to MYKITA than high-profile movie appearances. “We are not only selling fashionable sunglasses for the fashion people in the big cities,” he says. “We are also in smaller cities and have 2,000 points of sale in 56 countries.” He points out that the bulk of the company’s sales – 70% in fact – are from prescription glasses, not sunglasses, and that its customer base is very diverse. “It’s not like we are giving a message. We are leaving our customers to be our customers, but it’s their decision. If they like it, they will take it. If not, maybe they like a different kind of product.”

Former design director Gottschling recently retired from MYKITA’s day-today business to pursue new projects. But Krueger maintains that, even though they’re part of an incredibly hip brand, he and his remaining partners don’t feel any pressure to stay cool or shun the mainstream. What’s more important is sticking to their original values of quality and ethical production. “We are very authentic and authenticity is not something you can add to something. It’s natural. It’s either there or it’s not.” Having said that, there is no mistaking the care that MYKITA takes in the way it presents itself. All of its stores have a distinctive minimalist look, designed by the MYKITA team, and each is fitted with a product presentation wall installation made from perforated L-shaped metal brackets, normally used for heavy-duty shelving.

Since the opening of its first shop in Berlin in 2007, the team has opened branches in Zurich, Vienna, Paris, Monterrey and Tokyo. They also have two shop-in-shops, including one in the Andreas Murkudis minimalist concept store, a massive curated space inside a former newspaper printing press on Berlin’s Potsdamer Strasse. In London, they turned their nose up at trendy Shoreditch and are now considering Mayfair. In addition, MYKITA would like to open a store in New York, but is taking its time over finding the right space – all part of the firm control that its founders like to maintain.

As they try to balance the pressure on them to expand with the rigours of sustaining their handmade identity, this is something that the four men have to be mindful of. “Of course we could probably sell more than we are selling,” Krueger says. “I wouldn’t say we are limited in our production, but we have to increase our production step by step to guarantee our quality and the quality of our products. We believe in an organic growth. Maybe we cannot make any great leaps forward, but we’ll make sure our growth is on a really solid and sustainable foundation.”

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