Linklaters’ Five Key Takeaways from The Luxury Law Summit Americas on “Fashion’s Distinguishing Digital Assets: More Technologies Being Woven into the Fashion Scene through M&A”

Recently, Linklaters lawyers Joshua Ashley Klayman, U.S. Head of Fintech, and Pierre-Emmanuel Perais, M&A Partner, spoke at The Luxury Law Summit Americas on “Fashion’s Distinguishing Digital Assets: More Technologies Being Woven into the Fashion Scene through M&A” in New York City on November 2, 2022. The panel discussed how a brand personalizes with digital tools to increase customer interaction, improve operations, payments and sustainability, as well as considerations for developing these technologies in-house or acquiring tech specializations through M&A endeavors. Linklaters’ M&A and tech teams are active in the sector, working closely with brands and industry participants on their most pressing issues.

Five key takeaways from the panel can be found below.

1. Know and predict your customer – as fintech and digital assets continue to become woven into luxury brands, it is critical that these brands anticipate their customers’ preferences and know where to capture new customers – both today and in the future.
2. Assess risks in digital assets – certain digital assets may be deemed securities, with vast legal and regulatory implications, and the digital asset space can be more exposed to regulatory risks than brands may be comfortable with – or even be aware of.
3. Strategize M&A for a quick tech expansion – M&A will continue to play an oversized role in the evolution of luxury brands’ incorporation and deployment of digital assets and technologies in their brand strategies.
4. Prepare for the M&A transaction involving startups – invest in early discussions with founders and clearly set expectations on their involvement post-closing. Explore alternative structures at the onset (earn out? employment arrangement? consulting?) to minimize risks of negotiations stalling or founders walking away.
5. Harness technologies to enhance the customer experience – the use of apps and other technologies enable brands to better market their products and initiatives on a global scale rather than only through the more localized, traditional means of marketing, such as billboards, storefronts and publications. However, by collecting important customer features and data, acquisitions of tech solutions may also expose brands to new regulatory challenges such as foreign investment control and data privacy and security.