Like Jack and his magic beanstalk, Urban Outfitters President Richard Hayne turned a few hippie beans into a hip $700 million retail empire.
Dick Hayne hates when journalists write stories that compare and contrast the divergent paths he and his former wife have taken--how she's stayed true to the liberal idealism of their youth while he's morphed into a conservative capitalist entrepreneur. But to write it any other way would be disingenuous.
"Judy has so integrated her politics into her business, and God bless her, but that's not what we are about," says Hayne, sitting at a conference table at the Urban Outfitters corporate headquarters just off Rittenhouse Square.
"We are about giving 3,600 people a job and an opportunity for advancement, a chance to live their lives as they see fit. Somewhere that became viewed as somehow wrong. But the fact is Judy was involved in the store for a year and a half 33 years ago. Let's get over it. She has her life and I've got mine. I spent 31 and a half years developing this company when she wasn't around."
Furthermore, Hayne says, he never considered himself a hippie, even back when he had long hair and openly protested the Vietnam War. "I would never and did not ever characterize myself as a hippie," he says firmly. "But it is fair to say we were influenced by the fashion of the times. So if having long hair is equated with hippiedom, then one could make that mistake. But I never called myself a 'hippie.'"
He does, though, acknowledge the fact that the political script has flipped. "[Calling the store Free People] seemed very appropriate for the time--it was a very political time," he says. "It had a political connotation at the time, and it probably almost has the exact opposite political connotation it has now ... The connotation in 1970 was about the lifestyle of that generation, and the connotation today is much more American flag."
He's talking about "free" in the capital-D democracy sense of the word, as well as free in the unregulated market sense of the word. Over the course of a two-hour interview with PW, he repeatedly conjures up the specter of Joseph Stalin as if he were somehow still a threat to the American way. As if to answer the unasked question of which side Urban Outfitters is on, a large American flag hangs front and center in the lobby of Urban Outfitters' corporate headquarters.
As a young man, Dick Hayne's politics were motivated by the us-vs.-them dynamic of his opposition to Vietnam. The day the war ended, he lost that motivation. "[The war] had been incredibly divisive, and there was just this amazing change of mood," he says. "People wanted to forget about it. The name 'Free People' had some political connotations, and they were growing tired. They were quickly becoming out of fashion. It happened to be the time when we were just putting together the deal to move to a much larger space and felt that, in conjunction with that, we should change our name."
In 1975 the Free People's Store became Urban Outfitters and moved into a massive 20,000-square-foot warehouse space at 4040 Locust St.--increasing the size of its selling floor 20 times over. It would be three years before Urban Outfitters could afford to stock enough inventory to fill up all that square footage. In 1979 Hayne was looking for new challenges when a vendor told him about a like-minded store on Harvard Square in Cambridge, Mass., that was in need of a little operating capital. "That was the understatement of the day--they were basically bankrupt," says Hayne. "We negotiated the purchase and got the lease."
Urban Outfitters was officially on the move.
Hayne focused his energy on the Cambridge store, and within a year it was trumping the Philadelphia location's impressive sales volume. In 1983 Urban Outfitters opened a second Philadelphia store at 1801 Walnut St., across from Rittenhouse Square.
In 1984 Hayne started his wholesale line, and with a hint of nostalgia he will only grudgingly cop to, named it Free People. By 1987 Urban Outfitters had stores in New York, Philadelphia and Washington, D.C.-- the "Amtrak Corridor," Hayne likes to call it.
In 1992 he launched a new store concept, Anthropologie, a nod to his college major, designed to appeal to female customers aging out of Urban Outfitters' 18- to 30-year-old target demographic. Hayne knew instinctively that Anthropologie's target audience was migrating to the suburbs, and so he opened the flagship store on the Main Line in Wayne.
The concept was a hit, but there was a brief setback when Hayne attempted to add apparel for thirtysomething men into the retail mix. "For a suburban man aged 30 to 40, hell is going clothing shopping on a Saturday afternoon," he says with a chuckle. "There are about 5,000 other things they would put on the list ahead of clothes shopping."
In 1993 Urban Outfitters went public, with Hayne holding onto 35 percent of the stock. To this day all his wealth is tied up in Urban Outfitters. Throughout the '90s, Urban Outfitters continued to open new stores at an aggressive pace--Chicago, Minneapolis, Seattle, San Francisco, Los Angeles, San Diego, Tucson, Austin, Dallas, Houston, Miami Beach and a host of smaller markets in between.
In 1998 Hayne imported the Urban Outfitters concept to London, with stores in Dublin and Glasgow following close behind. Over the last five years the company's net sales have grown 20 percent per year, from $210 million to $423 million. During that time period shareholder equity has more than doubled.
Over the course of Urban Outfitters' rise to market dominance, Hayne has bled all the politics, left-wing or otherwise, out of his business dealings. "As a company, we don't contribute to any cause except noncontroversial things like a breast cancer walk," he says. "I don't know anybody who is for breast cancer."
Yet Hayne himself is an ardent Republican. He is a financial supporter of arch conservative Sen. Rick Santorum, whose recent comments about homosexuals equated gay sex with incest and bestiality.
When PW asks Hayne about his financial support of Santorum, he initially denies it. And when presented with a computer printout of Santorum's campaign donors from the Center for Responsive Politics website--which cites a $4,650 contribution from Urban Outfitters--he responds: "I'll have to look into this. I don't think this is right." In fact, he and his wife have contributed $13,150 to Santorum and Santorum's Political Action Committee over the years.
PW's Summer Guide 2014