ARM’S LENGTH: Founded in 2004, jewelry and design firm Alex and Ani’s meteoric rise has seen it grow to 40 stores in 11 states. Recently departed CEO Giovanni Feroce oversaw much of that growth.
PBN FILE PHOTO/RUPERT WHITELEY
INVEST WISELY: The lack of a clear transition plan from Giovanni Feroce to his successor at a time when Alex and Ani is preparing for an IPO could be off-putting to potential investors, according to Mark Higgins, dean of URI’s College of Business Administration.
The abrupt March 13 departure of Alex and Ani LLC CEO Giovanni Feroce may prove to be little more than natural growing pains for a company that saw a meteoric four-year growth run during his tenure, or it could signal trouble to potential investors, say business observers.
The Cranston-based jewelry and design firm has done little to shed light on Feroce’s departure or dispel speculation it was fueled by investors seeking a change.
Founder and Creative Director Carolyn Rafaelian, who launched the company named after her children in 2004, will step into the CEO’s role on an interim basis. The company announced it will seek a new chief executive “who has experience leading a fast-growing company to the next level and who can provide the strategic direction and vision that will serve us well into the future.”
For now, it remains “business as usual” at Alex and Ani, spokesman Gregg Perry told Providence Business News last week.
“The company is continuing to grow, and we are following and executing a business strategy set out by Carolyn Rafaelian and the board that’s been in place for some time to move us forward,” Perry said.
The company does not have a firm timeline for bringing in a replacement for Feroce, he added. “We are not going to rush the process. We’ll make an announcement when we find the right individual. Ultimately, the board is looking for a person that has the right synergy and experience to be able to move the company forward efficiently.”
Alex and Ani says 2013 sales reached $238 million, triple the previous year’s levels and more than 5,000 percent higher than the $4.6 million it recorded in 2010. Observers say businesses that experience such dramatic growth often require new leaders to help guide them to the next stage.
The fact that Alex and Ani parted ways with Feroce less than 18 months after announcing it had taken its first outside investment, from San Francisco-based private equity firm JH Partners, suggests those investors pushed for the change, said Mark Higgins, dean of the College of Business Administration at the University of Rhode Island.
JH Partners and Managing Partner John Hansen did not immediately respond to requests for comment.
“There is more going on than they’re letting out,” Higgins said. “If their intent is to go public, we would see more of what I would call an orderly transition. I would also expect the venture capitalists to have more comment than they have.”