Kotn co-founders Rami Helali , CEO, and Mackenzie Yeates, chief brand officer, have been discussing opening a hotel for years as an extension of the ethical fashion brand.Supplied
When retailer Kotn opens its next location outside North America later this spring, it will mark another milestone for the ethical fashion brand: the launch of its first hotel.
The hotel and store, located in the Shoreditch neighbourhood of London, U.K., is an unconventional step for the Toronto-founded basics brand that has built its reputation on an environmentally sustainable and ethical approach to fashion and home essentials.
However, Rami Helali, Kotn’s co-founder and CEO, says he and the brand’s co-founders – Mackenzie Yeates, chief brand officer, and Benjamin Sehl (who has since moved on to Shopify Inc.) – have been discussing opening a hotel for nearly a decade.
“We all felt very passionately that the best experiences we had shopping were always that store down the street that’s embedded in your neighbourhood … the culture you’re a part of,” Mr. Helali says.
When they discussed the future of Kotn, it always came back to the idea of creating spaces for people that capture the culture of the moment.
For Ms. Yeates, the connection with culture has been vital to Kotn’s success to date.
“Our first mission is to provide great products to our customers,” she says. “Beyond that, it’s about building community and celebrating different cultures.”
It has been a throughline for Kotn and its products since the company was created in 2015. Kotn has worked directly with farmers and communities in Egypt’s Nile Delta to grow and manufacture its Canadian-designed clothing. It’s since expanded into bedding, bath and living room essentials.
Kotn has capitalized on the growing demand for sustainably sourced clothing. According to a 2023 survey from Vividata, 44 per cent of Gen Z Canadians say they’re willing to pay more for sustainable clothing and the global ethical fashion market is projected to reach over $11.1-billion by 2027.
Kotn began with a direct-to-consumer e-commerce model, opening its first store in Toronto’s Queen West neighbourhood in 2017. It has since expanded to 12 stores across Toronto, Montreal, Vancouver, New York City, and Los Angeles, employing more than 150 people.
On the impact side, Kotn, a certified benefit corporation that must meet certain accountability and transparency standards, has built 23 schools across the farming communities where its cotton is grown and products are made.
“In the village where we built our second school, no one could read or write,” Mr. Helali says. “One of the girls who was a first student in that school is now going to university.”
For each farming family it works with, Kotn tries to pay a living wage either by giving them a higher than market-guaranteed price or by subsidizing their expenses, such as fertilizer or seeds.
“For our brand mission, it can be distilled down to community on both sides … building a community of customers that have similar values and uplifting the communities that we work with,” Ms. Yeates says.
Kotn is banking on those values translating into the hospitality environment.
Alexandra Baillie, president of Toronto-based impact investment firm Good & Well and an early investor and advisor to Kotn, says the shift to hospitality is a logical transition.
“They’ve tested [home essentials] and learned a lot about what people like and don’t like,” Ms. Baillie says.
And part of the plan is for Kotn to expand its home line.
“It’s a natural evolution of the process of testing something that could be an interesting area of development for the business [then] stepping in more deeply,” Ms. Baillie says. “[Kotn] is still focused on the core business and not losing focus there, but taking advantage of the opportunities.”
Despite the long-term goal of launching a hotel, Mr. Helali says the company didn’t originally envision London as its first foray into hospitality.
“To be honest, we were doing one in Cairo first,” he says.
However, delays in the legal process pushed it to focus on its London location first, with the Cairo hotel and store launch expected for later this year.
Jenna Jacobson, director of the Retail Leadership Institute at Toronto Metropolitan University’s Ted Rogers School of Management, says Kotn’s move into hospitality is unconventional but not unprecedented.
“There are some examples, more so in the Asian markets or Palazzo Versace in Dubai,” Dr. Jacobson says. “Some of the high-end brands are trying to create a collaborative or a creative space that mixes fashion, food, and stays.”
But she says Kotn will need to lean into the experiential and lifestyle aspects of the business to make the hotel concept work.
“It is a different industry,” she says. “You want to make sure that you have the right people with the right experience to lead the hospitality side while also ensuring you remain true to the core values.”
Mr. Helali’s family in Cairo has a background in hospitality in Egypt, which will be invaluable when it comes to opening its second hotel location there. In the meantime, he feels fortunate to work with investors like Good & Well that understand its vision for Kotn.
“This is finally a moment where we feel ready, we feel passionate, and we’ve found the right spaces to be able to do it,” Mr. Helali says. “We have plans to open a bunch more [hotels] across Europe and then hopefully Asia in 2026.”