Texas Monthly
The Yaga Saga
Ousted by his rich Galveston partners, clothing mogul Joe Flores is back with hip new designs
--and anxious to take on the company he founded
By Geoffrey Leavenworth
--and anxious to take on the company he founded
By Geoffrey Leavenworth
By all rights, Joe Flores should be celebrating. Yaga, the Galveston company he founded, will sell about $ 18 million worth of trendy clothes in the U.S. and abroad in 1995. Along with California-based rivals Mossimo, Stussy, and Quiksilver, Yaga has defined the look of today's teenagers: loose-fitting shorts, baseball caps, baggy T-shirts emblazoned with indecipherable symbols. Yaga designs are worn by the stars of hit TV shows like Melrose Place and Friends, as well as by pop singer Sheryl Crow and Jamaican reggae star Terror Fabulous, who titled his latest recording "Yaga Yaga."
But on a warm June afternoon in Galveston, Joe Flores was not celebrating: He had come to the Island to close a nearly $ 1 million deal for the sale of his family's Yaga stock. Last fall, although he was the company's largest shareholder and the chairman of its board, Flores was unceremoniously ousted by a group of wealthy investors, including members of Galveston's powerful Kempner family and Houston investment banker Jack Currie. Flores alleges that those investors -- who controlled a majority of seats on the Yaga board -- took advantage of his relative inexperience as a businessman and wrested control of the company from him. The investors counter that despite Flores creative talents, his abrasive management style had become a liability at a key moment in the company's history. Whatever the case, Flores is out, and his bitterness is evident. "Yaga wasn't just a business," he says. "It was my life."
Still, Flores isn't taking matters lying down. In July he and his son, Tod, his longtime creative and business partner, founded a new Miami-based clothing company, Kulcha, that he hopes will help him recapture his past success. "At Yaga, I listened to the tune -- fashion, music, trends -- interpreted what was happening, and tried to turn it into something special," he says. At Kulcha, he insists, he will do the same and, in the process, take on the business he built.
Lean and handsome, Joe Flores looks improbably hip for a fifty-year-old: On that June day he wore a white T-shirt bearing a black symbol of his own design, battered blue jeans, sunglasses with brushed steel frames, and heavy black Portuguese sandals that by next summer will no doubt be the footwear of choice. Certainly he seemed miles from his childhood on hte Island. For a while, his family lived at Magnolia Homes, a bleak East End housing project. His father, Joe Flores. Sr., worked as a milkman and a locksmith but carned enough to send Joe Junior and his four siblings to Sacred Heart School, the parochial school where his mother, Carmen, taught.
During the summer after his senior year. Joe Junior worked on tugboats off the coast of Louisiana. It was there that he was introduced to the music of reggae progenitor Bob Marley, whose progressive politics and laid-back Caribbean lifestyle made a lasting impression on him. Then, starting with Texas A&M University, he bounced around from school to school over the next five years, eventually earning a business degree from the University of Houston in 1967. Nine years later, after Flores had worked various jobs in the insurance industry, in shipbuilding, at nightclubs, and even at a pastry shop, he and his wife, Diane, opened Outfitters and Co., a beachwear shop on Galveston's Seawall Boulevard.
That first store and the beachwear and casual clothing shops that Flores subsequently opened gave him a chance to learn merchandising, management, and the basics of the clothing trade. "Joe was a shrewd businessman," recalls William Cram, who ran a competing store before Flores hired him as a production assistant at Yaga in 1991. "He was very aggressive and knew when to make a move in the clothing world." Indeed, although Flores had no formal training, he showed a knack for directing the design work that made his shops and clothing lines distinctive. Eventually he began retailing his own designs, often executed by freelance artists.
The most popular of these was the clothing line he called Yaga. The story behind the Yaga name has been told many times, with the details growing cloudier in each version, but the basic story is this: While in high school in Galveston, Tod Flores encountered an exuberant alcoholic with a weathered face and long, tousled hair who frequently exclaimed, "Yaga!" Tod and his friends had no idea what "Yaga" meant -- or even if it was a word -- but they adopted it as a friendly salutation. Joe Flores quickly picked up on it and decided to use it in some of his T-shirt designs. Later, a young graphic artist named Bryce Cole drew the first Yaga man, an Islander with dreadlocks whose image would adorn thousands of shirts, Finally, in 1988, Flores took Yaga as the name of his shop and his fledgling clothing company. What does Yaga mean to him today? "It's that 'irie' feeling," he explains, using the Jamaican slang for "all right."
In the late eighties Yaga did more than all right: Flores burgeoning empire encompassed three Galveston stores, a popular nightclub called Yaga's Tropical Cafe, a cookie and frozen yogurt shop, a wholesale clothing business, and a small T-shirt printing plant. Of these, it was the wholesaling business that he was most eager to expand, and he needed money to do it. To raise capital he turned to the people around him: his insurance agent, his old baseball coach, a former employer, and his younger brother Allen. In a move that proved far more significant than the money that would change hands, he also approached the landlord of one of his shops, Robert Lee Kempner Lynch.
The great-grandson of Harris Kempner, the nineteenth-century empire builder who was the patriarch of one of Galveston's oldest and most influential families, Robert Lynch sits on the boards of many Kempner interests, including Imperial Holly Corporation of Sugar Land, which sells Imperial Sugar; the Foster Farms ranching operation outside Houston; United States National Bank in Galveston; and the Harris and Eliza Kempner Fund, a private foundation also based in Galveston, Lynch, a respected developer and third-term city councilman, has been active in countless civic organizations; since the late seventies, for instance, he has managed the renovation of historic buildings in the Strand Historic District. Unpretentious and avuncular, he has a kindly oval face and soft gray curls that make him look somewhat older than his 45 years.
Flores, the budding Hispanic entrepreneur, and Lynch, the child of privilege, clearly represented opposite ends of Galveston's social spectrum. For generations, the Kempners have used their wealth and influence to shape the life of the Island. By contrast, Flores was the first member of his family to earn a college degree. Their personalities were dissimilar too: While Lynch is gregarious and a genuine presence on the local scene, Flores shuns the limelight. In fact, when the Small Business Administration named Flores entrepreneur of the year in 1994, he didn't show up to accept the award. "I don't like interviews and publicity," he says, "I stay behind the scenes."
Nevertheless, Lynch admired Flores and his work, and he initially invested $ 10,000 in Yaga, "Joe had great designs and a good sense of fashion," Lynch says today. Armed with a new infusion of funds, Flores continued to work with designers to create the bold, inventive graphics and color combinations that distinguished his clothing. Peripatetic by nature, he often roamed his beloved Caribbean in search of images, catchy phrases in the local patois, and new music for inspiration. In addition to expanding the Yaga line, he also began licensing stores in tony retail centers in major cities like Houston, San Antonio, and Miami. These stores not only sold millions of dollars worth of Yaga clothing, but they also gave the line critical exposure, because the company did almost no advertising. In 1993, with Yaga logging more than $ 7 million in sales, Flores moved to Miami to establish a Yaga office there.
But a growing company has an appetite for cash, and Yaga's was insatiable. Flores, who had brought Tod into the business, was eager to break out of Yaga's main market, the Gulf Coast, and enter the national arena, but he also wanted to expand into sportswear. That meant more staff, a bigger presence at the shows (the major trade marts where retailers view and order clothing), sophisticated advertising, and a California office. In short, he needed a lot more money than he'd ever raised before: $ 600,000.
When he asked Lynch if he knew people who might be willing to put up that kind of cash to finance his expansion, he was introduced to Jack Currie, a trustee of the Kempner Fund who had been a senior executive at the investment banking firm of Rotan Mosle. Currie, in turn, brought in James Bradford Poynter, a Houstonbased troubleshooter with a master's degree in business from Harvard and experience in investment banking and oil. Together, the three men formed a new group of investors in late 1993, including ex-Houston Rockets owner Charlie Thomas and H. Kempner Unincorporated, a Kempner family trust. The resulting private stock offering, however, reduced the Flores family's stock position from 54 percent of the company to 39 percent. And as a condition of their involvement, the new shareholders required that Yaga hire a chief financial officer to help alleviate growing pains and, presumably, to watch over their investment.
Their choice was Brad Poynter, who proved to be more like Flores than Lynch was: blunt, aggressive, confrontational. But Flores and Poynter never meshed well, largely because of what Poynter saw as Flores' managerial flaws. For one thing, people skills were not Flores' strong suit. "Joe never told me I did a good job," says Bryan Steward, a longtime Yaga employee and shareholder who now works as the company's production manager. "Sometimes he could be pretty harsh." Flores himself admits he was miserly with praise. But he says that people around him knew he had high expectations and that they understood he appreciated them by virtue of the fact that they kept their jobs.
Another problem may have been Flores' drinking. Flores readily admitted that he drank with employees, often at work. "It might be the middle of the afternoon, and Joe would stuff some money into your hand and tell you to go buy a case of beer," says Steward. "He was very much a party hound. That's probably part of what did him in." Others, however, support Flores' assertion that while he was a regular drinker, it never seemed to compromise his ability to run things.
As 1994 wore on, Yaga's sales were higher than ever, but profits were vanishing because the company's explosive growth required investment in the corporate infrastructure and caused management and cash flow problems. Poynter and the other investors blamed Flores for the squeeze -- and it certainly didn't help matters that Flores was in Miami while their support for him was waning. "I think the board felt like I needed to get back to Texas to handle my responsibilities," he says today.
Finally, in August of last year, the board decided to remove Flores as president and CEO and replace him with Robert Lynch, whose tact and less abrasive style, it was believed, might stabilize Yaga. "The bottom line was that the board was feeling uncomfortable with the leadership at a critical time in the company's history," says Lynch. As a nod to Flores' past contribution he was named chairman of the board, will the understanding that he would concentrate on design and product development and let Lynch and Poynter manage things.
But it was not to be: Flores couldn't seem to let go of the company he had dominated for years. "People thought Tod and I had trouble giving up control," he says. "Well, when it came to the image and marketing, yeah, we wanted control." According to Flores, image governed decisions ranging from the inventory and signage of licensed stores to the size of exhibit space at trade shows -- even whether to discontinue popular product lines.
During this stormy period, Flores contends, he learned that the agreement he had signed a year carlier with Poynter's investor group held an onerous stipulation. Drawn up by the Houston law firm of Baker and Botts, the agreement empowered the new investors to elect three of the five Yaga directors. Thus, even though Flores, his family, and other sympathetic shareholders might make up a majority of the company's ownership, the newcomers controlled the board. Why didn't Flores read the agreement more carefully or hire his own lawyer? "I didn't think I needed to," he says. "I thought I was among friends."
While Lynch says he doesn't recall having discussed the provision with Flores, Poynter is adamant that he made certain Flores was fully informed. "It was a fundamental part of the entire transaction," he insists. "It was discussed ad nauseam." Given the many directions in which Flores was stretched at the time the deal was negotiated, he may well have overlooked the fine print; his own brother Allen, for one, thinks such carelessness is plausible. "Joe didn't always tie up the loose ends," says Allen, who is a successful Galveston entrepreneur in his own right. "He didn't dot the i's and cross the t's. He never thought things were going to go wrong." Even Flores himself sees the problem today: "I guess it was my stupidity or naivete about why equity people come into a business."
In any event, it quickly became clear that the new arrangement wasn't going to fly. "I could tell within a few days that I could not work with Joe," recalls Lynch. "Joe's a very creative guy. If he'd stuck with the design work, he still might be here. But if you build a company, it's hard to give up control and enjoy it."
In October 1994, two months after the first demotion, Joe Flores was fired outright by Lynch -- over the telephone. Within the halls of Yaga, word spread fast. "I was upset," recalls William Cram, who was not alone in his response to the news. "It was like losing a member of the family." Steward says it took him two months to get over the shock -- and another shock was soon to come. A few weeks after Joe was ousted, Lynch and Tod Flores had an argument that resulted in Tod's being fired as well.
And that, more or less, is the Yaga saga. A year later, the company is prospering without its founder. Under CEO Lynch, it is rapidly expanding its sportswear and junior women's lines and may move into swimwear and footwear. Yaga products are gaining popularity in Japan, Germany, Mexico, and other countries. And future deals could be in the works: "It's the right of the shareholders to monetize their investment," Poynter says, "either by taking the company public or by means of a merger or the sale of the company." Of course, if Yaga was to go public, as its rival Quiksilver did in 1986, or if it was sold to a corporate Goliath such as Nike, it could earn millions for its major shareholders and make Flores' payoff look like peanuts.
Flores, meanwhile, is prospering too. On the heels of his stock sale -- much of it at 23 times the original purchase price -- he is focusing his attention on his new venture, Kulcha, and particularly on the 9 Myles line, which is named for the Jamaican village where Bob Marley was born. Kulcha is a partnership between him and Tod and investors in Dallas and Tampa. This time Flores is keeping everything close to home. He and Tod own 50 percent and have a management contract that puts them firmly at the helm. The pair will also direct the designs. Even the expansion -- for now -- is in the family: Kulcha recently acquired LaVida Clothing a $ 1 million-a-year concern, from its founder, Allen Flores. "We're trying to return to our original concept with Yaga: have fun, make money, and support good causes," Joe says.
Because Flores is intent on building 9 Myles into a major label, he will undoubtedly cross swords with his old colleagues at Yaga. This summer 9 Myles issued a vituperative press release saying: "To anyone else, Yaga is just a name. To them [Joe and Tod], Yaga had become their life. They had built this company from nothing and watched some greedy demons take it from them." The first real encounter will come this fall, when Kulcha and Yaga vie for attention at a series of crucial trade shows introducing the designs for next spring. "We're glad to be back," Flores says. But as he knows, fashion is fickle, so only a strong showing in the coming weeks will prove if he's really back.
Texas Monthly, October 1995
But on a warm June afternoon in Galveston, Joe Flores was not celebrating: He had come to the Island to close a nearly $ 1 million deal for the sale of his family's Yaga stock. Last fall, although he was the company's largest shareholder and the chairman of its board, Flores was unceremoniously ousted by a group of wealthy investors, including members of Galveston's powerful Kempner family and Houston investment banker Jack Currie. Flores alleges that those investors -- who controlled a majority of seats on the Yaga board -- took advantage of his relative inexperience as a businessman and wrested control of the company from him. The investors counter that despite Flores creative talents, his abrasive management style had become a liability at a key moment in the company's history. Whatever the case, Flores is out, and his bitterness is evident. "Yaga wasn't just a business," he says. "It was my life."
Still, Flores isn't taking matters lying down. In July he and his son, Tod, his longtime creative and business partner, founded a new Miami-based clothing company, Kulcha, that he hopes will help him recapture his past success. "At Yaga, I listened to the tune -- fashion, music, trends -- interpreted what was happening, and tried to turn it into something special," he says. At Kulcha, he insists, he will do the same and, in the process, take on the business he built.
Lean and handsome, Joe Flores looks improbably hip for a fifty-year-old: On that June day he wore a white T-shirt bearing a black symbol of his own design, battered blue jeans, sunglasses with brushed steel frames, and heavy black Portuguese sandals that by next summer will no doubt be the footwear of choice. Certainly he seemed miles from his childhood on hte Island. For a while, his family lived at Magnolia Homes, a bleak East End housing project. His father, Joe Flores. Sr., worked as a milkman and a locksmith but carned enough to send Joe Junior and his four siblings to Sacred Heart School, the parochial school where his mother, Carmen, taught.
During the summer after his senior year. Joe Junior worked on tugboats off the coast of Louisiana. It was there that he was introduced to the music of reggae progenitor Bob Marley, whose progressive politics and laid-back Caribbean lifestyle made a lasting impression on him. Then, starting with Texas A&M University, he bounced around from school to school over the next five years, eventually earning a business degree from the University of Houston in 1967. Nine years later, after Flores had worked various jobs in the insurance industry, in shipbuilding, at nightclubs, and even at a pastry shop, he and his wife, Diane, opened Outfitters and Co., a beachwear shop on Galveston's Seawall Boulevard.
That first store and the beachwear and casual clothing shops that Flores subsequently opened gave him a chance to learn merchandising, management, and the basics of the clothing trade. "Joe was a shrewd businessman," recalls William Cram, who ran a competing store before Flores hired him as a production assistant at Yaga in 1991. "He was very aggressive and knew when to make a move in the clothing world." Indeed, although Flores had no formal training, he showed a knack for directing the design work that made his shops and clothing lines distinctive. Eventually he began retailing his own designs, often executed by freelance artists.
The most popular of these was the clothing line he called Yaga. The story behind the Yaga name has been told many times, with the details growing cloudier in each version, but the basic story is this: While in high school in Galveston, Tod Flores encountered an exuberant alcoholic with a weathered face and long, tousled hair who frequently exclaimed, "Yaga!" Tod and his friends had no idea what "Yaga" meant -- or even if it was a word -- but they adopted it as a friendly salutation. Joe Flores quickly picked up on it and decided to use it in some of his T-shirt designs. Later, a young graphic artist named Bryce Cole drew the first Yaga man, an Islander with dreadlocks whose image would adorn thousands of shirts, Finally, in 1988, Flores took Yaga as the name of his shop and his fledgling clothing company. What does Yaga mean to him today? "It's that 'irie' feeling," he explains, using the Jamaican slang for "all right."
In the late eighties Yaga did more than all right: Flores burgeoning empire encompassed three Galveston stores, a popular nightclub called Yaga's Tropical Cafe, a cookie and frozen yogurt shop, a wholesale clothing business, and a small T-shirt printing plant. Of these, it was the wholesaling business that he was most eager to expand, and he needed money to do it. To raise capital he turned to the people around him: his insurance agent, his old baseball coach, a former employer, and his younger brother Allen. In a move that proved far more significant than the money that would change hands, he also approached the landlord of one of his shops, Robert Lee Kempner Lynch.
The great-grandson of Harris Kempner, the nineteenth-century empire builder who was the patriarch of one of Galveston's oldest and most influential families, Robert Lynch sits on the boards of many Kempner interests, including Imperial Holly Corporation of Sugar Land, which sells Imperial Sugar; the Foster Farms ranching operation outside Houston; United States National Bank in Galveston; and the Harris and Eliza Kempner Fund, a private foundation also based in Galveston, Lynch, a respected developer and third-term city councilman, has been active in countless civic organizations; since the late seventies, for instance, he has managed the renovation of historic buildings in the Strand Historic District. Unpretentious and avuncular, he has a kindly oval face and soft gray curls that make him look somewhat older than his 45 years.
Flores, the budding Hispanic entrepreneur, and Lynch, the child of privilege, clearly represented opposite ends of Galveston's social spectrum. For generations, the Kempners have used their wealth and influence to shape the life of the Island. By contrast, Flores was the first member of his family to earn a college degree. Their personalities were dissimilar too: While Lynch is gregarious and a genuine presence on the local scene, Flores shuns the limelight. In fact, when the Small Business Administration named Flores entrepreneur of the year in 1994, he didn't show up to accept the award. "I don't like interviews and publicity," he says, "I stay behind the scenes."
Nevertheless, Lynch admired Flores and his work, and he initially invested $ 10,000 in Yaga, "Joe had great designs and a good sense of fashion," Lynch says today. Armed with a new infusion of funds, Flores continued to work with designers to create the bold, inventive graphics and color combinations that distinguished his clothing. Peripatetic by nature, he often roamed his beloved Caribbean in search of images, catchy phrases in the local patois, and new music for inspiration. In addition to expanding the Yaga line, he also began licensing stores in tony retail centers in major cities like Houston, San Antonio, and Miami. These stores not only sold millions of dollars worth of Yaga clothing, but they also gave the line critical exposure, because the company did almost no advertising. In 1993, with Yaga logging more than $ 7 million in sales, Flores moved to Miami to establish a Yaga office there.
But a growing company has an appetite for cash, and Yaga's was insatiable. Flores, who had brought Tod into the business, was eager to break out of Yaga's main market, the Gulf Coast, and enter the national arena, but he also wanted to expand into sportswear. That meant more staff, a bigger presence at the shows (the major trade marts where retailers view and order clothing), sophisticated advertising, and a California office. In short, he needed a lot more money than he'd ever raised before: $ 600,000.
When he asked Lynch if he knew people who might be willing to put up that kind of cash to finance his expansion, he was introduced to Jack Currie, a trustee of the Kempner Fund who had been a senior executive at the investment banking firm of Rotan Mosle. Currie, in turn, brought in James Bradford Poynter, a Houstonbased troubleshooter with a master's degree in business from Harvard and experience in investment banking and oil. Together, the three men formed a new group of investors in late 1993, including ex-Houston Rockets owner Charlie Thomas and H. Kempner Unincorporated, a Kempner family trust. The resulting private stock offering, however, reduced the Flores family's stock position from 54 percent of the company to 39 percent. And as a condition of their involvement, the new shareholders required that Yaga hire a chief financial officer to help alleviate growing pains and, presumably, to watch over their investment.
Their choice was Brad Poynter, who proved to be more like Flores than Lynch was: blunt, aggressive, confrontational. But Flores and Poynter never meshed well, largely because of what Poynter saw as Flores' managerial flaws. For one thing, people skills were not Flores' strong suit. "Joe never told me I did a good job," says Bryan Steward, a longtime Yaga employee and shareholder who now works as the company's production manager. "Sometimes he could be pretty harsh." Flores himself admits he was miserly with praise. But he says that people around him knew he had high expectations and that they understood he appreciated them by virtue of the fact that they kept their jobs.
Another problem may have been Flores' drinking. Flores readily admitted that he drank with employees, often at work. "It might be the middle of the afternoon, and Joe would stuff some money into your hand and tell you to go buy a case of beer," says Steward. "He was very much a party hound. That's probably part of what did him in." Others, however, support Flores' assertion that while he was a regular drinker, it never seemed to compromise his ability to run things.
As 1994 wore on, Yaga's sales were higher than ever, but profits were vanishing because the company's explosive growth required investment in the corporate infrastructure and caused management and cash flow problems. Poynter and the other investors blamed Flores for the squeeze -- and it certainly didn't help matters that Flores was in Miami while their support for him was waning. "I think the board felt like I needed to get back to Texas to handle my responsibilities," he says today.
Finally, in August of last year, the board decided to remove Flores as president and CEO and replace him with Robert Lynch, whose tact and less abrasive style, it was believed, might stabilize Yaga. "The bottom line was that the board was feeling uncomfortable with the leadership at a critical time in the company's history," says Lynch. As a nod to Flores' past contribution he was named chairman of the board, will the understanding that he would concentrate on design and product development and let Lynch and Poynter manage things.
But it was not to be: Flores couldn't seem to let go of the company he had dominated for years. "People thought Tod and I had trouble giving up control," he says. "Well, when it came to the image and marketing, yeah, we wanted control." According to Flores, image governed decisions ranging from the inventory and signage of licensed stores to the size of exhibit space at trade shows -- even whether to discontinue popular product lines.
During this stormy period, Flores contends, he learned that the agreement he had signed a year carlier with Poynter's investor group held an onerous stipulation. Drawn up by the Houston law firm of Baker and Botts, the agreement empowered the new investors to elect three of the five Yaga directors. Thus, even though Flores, his family, and other sympathetic shareholders might make up a majority of the company's ownership, the newcomers controlled the board. Why didn't Flores read the agreement more carefully or hire his own lawyer? "I didn't think I needed to," he says. "I thought I was among friends."
While Lynch says he doesn't recall having discussed the provision with Flores, Poynter is adamant that he made certain Flores was fully informed. "It was a fundamental part of the entire transaction," he insists. "It was discussed ad nauseam." Given the many directions in which Flores was stretched at the time the deal was negotiated, he may well have overlooked the fine print; his own brother Allen, for one, thinks such carelessness is plausible. "Joe didn't always tie up the loose ends," says Allen, who is a successful Galveston entrepreneur in his own right. "He didn't dot the i's and cross the t's. He never thought things were going to go wrong." Even Flores himself sees the problem today: "I guess it was my stupidity or naivete about why equity people come into a business."
In any event, it quickly became clear that the new arrangement wasn't going to fly. "I could tell within a few days that I could not work with Joe," recalls Lynch. "Joe's a very creative guy. If he'd stuck with the design work, he still might be here. But if you build a company, it's hard to give up control and enjoy it."
In October 1994, two months after the first demotion, Joe Flores was fired outright by Lynch -- over the telephone. Within the halls of Yaga, word spread fast. "I was upset," recalls William Cram, who was not alone in his response to the news. "It was like losing a member of the family." Steward says it took him two months to get over the shock -- and another shock was soon to come. A few weeks after Joe was ousted, Lynch and Tod Flores had an argument that resulted in Tod's being fired as well.
And that, more or less, is the Yaga saga. A year later, the company is prospering without its founder. Under CEO Lynch, it is rapidly expanding its sportswear and junior women's lines and may move into swimwear and footwear. Yaga products are gaining popularity in Japan, Germany, Mexico, and other countries. And future deals could be in the works: "It's the right of the shareholders to monetize their investment," Poynter says, "either by taking the company public or by means of a merger or the sale of the company." Of course, if Yaga was to go public, as its rival Quiksilver did in 1986, or if it was sold to a corporate Goliath such as Nike, it could earn millions for its major shareholders and make Flores' payoff look like peanuts.
Flores, meanwhile, is prospering too. On the heels of his stock sale -- much of it at 23 times the original purchase price -- he is focusing his attention on his new venture, Kulcha, and particularly on the 9 Myles line, which is named for the Jamaican village where Bob Marley was born. Kulcha is a partnership between him and Tod and investors in Dallas and Tampa. This time Flores is keeping everything close to home. He and Tod own 50 percent and have a management contract that puts them firmly at the helm. The pair will also direct the designs. Even the expansion -- for now -- is in the family: Kulcha recently acquired LaVida Clothing a $ 1 million-a-year concern, from its founder, Allen Flores. "We're trying to return to our original concept with Yaga: have fun, make money, and support good causes," Joe says.
Because Flores is intent on building 9 Myles into a major label, he will undoubtedly cross swords with his old colleagues at Yaga. This summer 9 Myles issued a vituperative press release saying: "To anyone else, Yaga is just a name. To them [Joe and Tod], Yaga had become their life. They had built this company from nothing and watched some greedy demons take it from them." The first real encounter will come this fall, when Kulcha and Yaga vie for attention at a series of crucial trade shows introducing the designs for next spring. "We're glad to be back," Flores says. But as he knows, fashion is fickle, so only a strong showing in the coming weeks will prove if he's really back.
Texas Monthly, October 1995