“As soon as we closed, the pressure went both down and up,” said Checketts, who delayed publicly discussing the deal until he had further affirmation that it was the right move. “There’s no safety net of a private equity partner so there’s a weight. But instead of it feeling heavy, it’s exciting and invigorating.”

Rhone, which was founded in 2014 and offers workout and casual wear, has been profitable the past three years and eclipsed $100 million in annual run-rate as it sped up store openings, according to Checketts. At a similar sales multiple to athletic apparel brand Lululemon

Checketts started focusing on buying back L Catterton’s stake as he pondered options for Rhone, which he said received interest from private equity firms offering to inject as much as $100 million with the expectation to take the company public, as well as from special purpose acquisition companies.

“I started to become really nervous about the signs we were seeing macro-economically,” said the 40-year-old Checketts. “The IPO market had been strong, but I wasn’t convinced that was going to last.”

Amid his uncertainty, Checketts sought the counsel of Brian Rolapp, a mentor who is the NFL’s chief media and business officer.

“Brian said, ‘You’re telling me you’re more confident in the business than you’ve ever been, so why don’t you figure out how to run this forever?’” Checketts said. 

Private

“I couldn’t stop thinking about it,” said Checketts, who then turned to his friend Tracy Farr, a Lazard investment banker. “I said ‘This sounds crazy, but is there any way to buy out one of the world’s largest consumer private equity funds so we can control the business?’” 

Farr outlined how a special purpose vehicle could work, prompting Checketts to search for a particular Google

“For more than five years, people had emailed me saying they’d love to invest in Rhone, and I’d saved their details,” Checketts said.

Blown away by responses and check commitments, Checketts reached out to L Catterton executives, who first said they were eager to remain investors. 

In 2022, following Russia’s invasion of Ukraine and a lull in monetization events amid softening valuations, Checketts tried again. 

“I told them: ‘Not for nothing, this is what I want,’” he said. “At that point, they were thoughtful and said: ‘if we can get to a number that makes sense, we’ll figure out a path.’”

The late former Utah Jazz owner Larry H. Miller’s family office, LHM, as well as institutions including Cypress Ascendant, Kaulig Capital and Sweetwater Private Equity also participated in the deal. Former NFL players including Tebow and Steve Young injected capital, joining other retired athletes such as Troy Aikman and Justin Tuck as Rhone investors.

L Catterton managing partner Jon Owsley remains on Rhone’s board despite the firm relinquishing its stake, Checkett said. In recent months, the retailer added its first female director, Tess Roering, a former marketing executive at Gap

Buying out L Catterton has made Rhone more of a family affair for Checketts, whose co-founders include brother Ben and brother-in-law Carras Holmstead, a Palistar Capital investment partner. The transaction also enabled David Checketts, his father and the former CEO of Madison Square Garden, to invest. 

Private equity firms and SPACs aren’t the only companies that have courted Rhone. In late 2016, Checketts said Gap flew him to San Francisco, where the chain is headquartered, to discuss a potential deal. Gap wanted to combine Rhone with Athleta

Instead, the retailer in 2018 announced the launch of Hill City, a brand that looked a lot like Rhone.

“They had similar product names and used some of the same models as we did,” Checketts said. 

The company responded in part by buying domain names affiliated with Hill City and redirecting them to Rhone’s website, according to Checketts. The threat didn’t last long as Gap shuttered the brand about two years after its launch. Gap didn’t respond to a request for comment. 

For now, Checketts is focused on expanding the apparel maker with the support of deep-pocketed investors.

“I am very excited to watch the brand continue to grow,” Plotkin said in a statement. “I am a big believer in Rhone’s product.”