Hello, everyone. This is Paul Kuntz with RedChip Companies. I want to thank everyone for joining us on today's call with Xcel Brands. Xcel Brands trades on the Nasdaq under the ticker symbol XELB. With us today, we have Xcel Brands Chairman and CEO, Bob D'Loren, and Executive VP of Business Development, Seth Burroughs. I'll be turning the call over to Bob in a moment for a brief presentation, and then we'll open up the event for Q&A thereafter. For those that do have questions, you can type those in by clicking the Q&A button at the bottom of the screen anytime during the presentation or the Q&A session. Now, before we begin, I will run through the Safe H arbor S tatement real quick. This call may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
All statements pertaining to future financial and/or operating results, along with other statements about the future expectations, beliefs, goals, plans, or prospects expressed by management, constitute forward-looking statements. Any statements that are not historical facts should also be considered forward-looking, and of course, forward-looking statements involve risks and uncertainties. With that said, I will now turn the call over to Bob. Please go ahead.
Thank you, Paul, and welcome everyone. I'm Bob D'Loren, I am the CEO of Xcel Brands. I'll start today's webinar with some opening remarks, and then Seth and I will share a company presentation with you, including an introduction to our new short-form video marketplace, ORME. So just real high level, Xcel is an industry-leading media and consumer products company focused on live streaming sales on linear television and streaming online. Last year, we achieved $4 billion in lifetime total retail sales of our brands through live streaming, encompassing over 20,000 hours of content production time. I'm excited to announce that we are launching our short-form video marketplace, ORME, that we believe will change the way people think about sharing over social media and solves the significant problems that the industry is having today with extremely high customer acquisition costs associated with digital affiliate and influencer marketing.
Just a reminder, please post your questions to the chat box, and when we end the presentation, we'll be happy to answer all of those questions. Let's turn right to the presentation, and Seth will start, and then we'll both present.
So just to get into a few high-level numbers about ourselves. We've been around for about 12 years, uplisted in Nasdaq in 2015, and since the beginning, the prior slide had a quote from Bob that we were built to reimagine shopping, entertainment, and social media, social commerce. That's been our mission since day one. So since we started, we've acquired seven brands in our portfolio, and we'll go over what those brands are, but primarily household names in fashion, jewelry, and one brand in home. We generate approximately $600 million per year in annual retail sales by the brands in our portfolio.
As Bob mentioned, we have over 20,000 hours of live stream programming, over 6 million followers on social media across our brands, and we've done over $4 billion in total sales at retail generated through live stream. We'll, we'll walk you through what that means in terms of revenue to Xcel Brands. We operate a working-c apital-l ight business model. But as far as we can tell, nobody has done nearly as much live stream shopping and social commerce as we have, and it is where we, where we think the market is going, so we're excited to be at the forefront of that.
Just a note on working c apital l ight. That means we don't take inventory risk. It's not that we haven't ever in the history of the company, but for the most part, we are a working-c apital-l ight company. There's no inventory risk.
So as I mentioned, we own seven brands today. I'll just quickly cover each of our brands. Judith Ripka is one of the foremost fine jewelry brands in the United States. The brand has had distribution all the way from Neiman Marcus and Saks down to QVC, where it was the number one fine jewelry brand on QVC for a number of years. We acquired the brand in 2014 and took over the QVC business. We recently signed a pretty massive deal with Jewelry Television, who's become the largest live stream television retailer of fine jewelry in the country. So that launched in October of last year and is well on its way to growing with JTV. LOGO by Lori Goldstein. Lori Goldstein is the number three brand on QVC that we acquired in 2021.
Halston is an iconic American brand. If you're not familiar with it, you should be. It's one of the top American fashion brands. We acquired Halston in two phases, in 2014 and in 2019, where we had the opportunity to reunite the brand as one. And Halston, we're really excited about. Last year, we signed a 25-year master license agreement with G-III. G-III has lost their license to Calvin Klein and Tommy Hilfiger, as VF Corporation decided to take those brands back in-house, and G-III planned to replace Calvin Klein with Halston. But in the words of their chairman, on their last earnings call, they expect that within three years, Halston will be a $500 million wholesale business.
We expect over the next 25 years, Halston should generate approximately $160 million-$175 million of royalties to Xcel Brands. That will be pretty much drop to our bottom line. Isaac Mizrahi is a brand that we have owned since we started Xcel Brands in 2011. It is the number one designer brand on QVC, iconic American fashion brand also. And we'll take you through when we get into the numbers. In 2022, we sold a majority interest in Isaac Mizrahi to a brand management company called WHP Global. We still retain a 30% interest in Isaac Mizrahi, and we're able to completely delever our balance sheet in 2022 with the sale of Isaac at a very strong multiple.
C. Wonder is a brand that was started by Chris Burch in 2014. We acquired the brand from Chris in 2015. We built the brand out for television, and last year we brought in Christian Siriano and launched the brand on HSN. We were just awarded Vendor of the Year at HSN for the launch. It's been one of the most successful launches they've ever had on the network, and that should grow nicely into this year, into 2024. Longaberger is the one home brand in our portfolio. We acquired that brand out of bankruptcy in 2019. It was one of the top direct selling companies in the country, with over $1.2 billion of sales at its peak in 2000.
We acquired Longaberger, and as we get into where we're going with ORME, really as a test in social commerce, and, you know, it's done very well for us. We've had a very engaged customer base, over 100,000 independent salespeople, and we've been able to take our learnings from Longaberger and translate it into what we've built out with ORME, which is social commerce technology. And our most recent brand is TWRHLL . TWRHLL is different than the other brands. We did not have to acquire the brand, and it should represent an example of maybe some of our future growth in Xcel by partnering with existing brands or existing celebrities to develop new brands.
We partnered with Christie Brinkley, one of the top supermodels in the country, to start TWRHLL , and it'll be the first apparel brand under Christie Brinkley. We're launching at HSN in March of this year.
So this slide is a very important slide that we look at for our brands. It's a leading indicator of brand health, and if you look at trends in retail sales of our brands, you'll see that in 2020, when COVID hit, top-line sales were down, but we do not sell any essential retailers, any mass retailers like Walmart or any of the clubs. By coming into 2021, because we took over certain operations at Halston and in our Judith Ripka business, we started to see very strong growth coming into 2021. 2022, that growth continued nicely. At 2023, again, you'll see the ups.
The big jump here is coming from the G-III license and the Jewelry TV license, as well as what we believe will be very strong growth on HSN with the TWRHLL brand, with Christie Brinkley and what is happening with the Christian Siriano program. So looking at the P&L, you can see that the company was profitable from inception, and coming into 2019, two of our licensees went into liquidation. The Halston company that was operating the Halston premium line, two labels that we didn't own at that time, went into liquidation, and our jewelry licensee for Judith Ripka went into liquidation, and we made a decision to take those businesses over and operate. We had to move fast, which we can do if we need to.
Coming into 2020, we were able to stay profitable, but as COVID presented challenges with deliveries, and canceled orders from retailers, increased logistics costs that eroded margins. We lost about $2.5 million in 2021, but continued to grow top-line sales of the brands, which positioned us well to do the kinds of transactions that we did in Q1 of 2023, this G-III and JTV. Looking at 2022, it looks like the company lost $12 million, but this is the year that we had the sale of the 70% interest in Isaac Mizrahi, and that resulted in a reduction in top line of about $16 million and nearly $7 million of EBITDA.
So that was the big swing there, but then, going into 2023, when we, when we realized we had the deals in place with G-III, JTV and One Jeanswear Group to do all of the production that we were doing for HSN, we made $13 million of overhead cuts coming into 2023 to position the company, to turn around in 2024 with all of the new license programs that we have and the coming launch of ORME. So if you look at the balance sheet. It mirrors this. You can see that in 2021, we ended the year with $28 million of term debt, which we had accumulated through all of these acquisitions, that we've been talking about.
We completely de-levered the company and was able to use excess proceeds to complete the transition or the discontinuance of the wholesale businesses. Then coming into 2024, based on our contractual minimums, we believe we will be nicely positioned with asset values on our brands based on the market comp from the sale of Isaac of about $110 million. And the way we get there is we're forecasting $18 million of royalty revenues in 2024. We use the same multiple that we received on Isaac, which is 6x royalties. It's about $110 million. Today, we have $5 million in debt, and so we believe that based on asset values alone, we're severely undervalued.
The intrinsic value or the implied value based on asset values should be around $5 per share, not ascribing any value to ORME, which we're going to discuss.
So just to quickly summarize on Xcel, we've covered a lot of these points. We definitely want to leave a few minutes to talk about ORME. We're really excited about that. You know, one, we believe we have a valuable brand portfolio with our existing brands with significant growth potential, meant much of that built in, for instance, with G-III. 6 million followers across our brands. We're working with a capital light business model. We have a proven track record. We've successfully harvested one of our brands and, you know, given the value that Bob just mentioned of the remaining brands in our portfolio, you could expect that that we would explore potential sales at the appropriate times.
We have a strong balance sheet today, a seasoned team of executives with unparalleled experience in live streaming social commerce, and several opportunities for growth, you know, both organic. If you think of Xcel as a brand management company that primarily owns brands that would do well in social commerce, there's new brand development like we did with Christie Brinkley, and we'll hopefully have some new brands going out over the next three months. And obviously, there should be opportunities for us to acquire brands that would do well in social commerce in a social commerce model. We definitely want to now talk, turn this to ORME and talk about what we believe is the first AI-powered short-form video marketplace to launch in the world.
And it's really based on the culmination of our experience in live stream shopping, social commerce, in partnership with a technology company. I will say before we get in, Xcel owns 30% of ORME. So the technology company owns the balance of the equity in ORME, but we're really, really excited to be launching this because it, I think, solves problems for a lot of brands and retailers who are struggling right now and really fills a void in the marketplace. So with that, I'll turn it to Bob to talk about ORME.
Okay. So we are very excited about ORME. It's been 2.5 years in the making. We've teamed up with an extraordinary technology company that had the tech, engineering, and coding capability, but didn't know exactly how to develop the technology to do the kinds of things that we needed it to do. And, we have applied AI across the platform. There are four AI engines built into this that I will get to. The next slide really covers ORME from the shopper or the influencer perspective. So for shoppers and influencers, to summarize this slide succinctly, this is a place where they can create, shop, and share, and get paid cash fees.
You know, people that are making money on information today in social media or the social media platforms, of course, they are ad-driven, cash flow models. What this model does is it flips this thing around, and it gives the ad dollars to, to the people, to the users for sharing, and it turns the everyday shopper into a paid social media influencer. We believe that this will change the way people think about sharing information about products, brands, and retailers over social media today. When they realize that they can be paid for doing it, it's going to change everything. Also, from a brands and a retailers perspective, quite frankly, this is a bit of a no-brainer. It's free to integrate, and it's a very fast integration with almost any platform, whether it's Shopify, Magento, or Salesforce.
And, they don't spend anything on marketing until there is a sale. So it changes the model from a pay-to-play model to a performance-based model. No one makes money on ORME until there's a sale. No one incurs costs on ORME or makes money until there's a sale. It is a solution for today's problems with high customer acquisition costs and affiliate influencer and digital marketing, and it results in an infinite return on ad spend. So we believe that this technology is the game changer that everyone's been waiting for in the West. It is working in the East, in places like China, and I'll cover a little bit of market size. But this is what everyone has been waiting for, this end-to-end ecosystem that enables it all to happen, and it brings every consumer and influencer into the commerce flywheel of retail.
Now, going to what is ORME for our investors? It comes with a management team that has over 20,000 hours of production time and $4 billion in live stream sales over television. And we believe ORME, if it scales the way we think it's going to scale, it has unicorn potential. It is state-of-the-art technology, and it is a leading applier of AI across the technology platforms. So going to the next slide. This is a forward-looking slide. Musk has said through Neuralink that in the next five years, he will solve the brain chip link, and we have built this technology to be ready for when that happens. It is the most advanced platform that will be introduced to the live stream and retail marketplace in many, many years. So in lay terms, what does ORME really do?
The tech inside, we call it Athena, and it really enables shoppers, brands, and retailers to create shoppable content as easy as, as it is to do on TikTok. It's a three-click checkout process in video, and shoppers and influencers earn fees for sharing. It's a performance-based payout model. There are no more vague return on ad spend reports, and ORME boosts content 100x. Today, companies that create content often lose that content by the end of the same business day because the algorithms on all the social platforms push it down.
On ORME, when participants start to engage on the ORME platform, each and every one of them can create their own digital store, and they can preserve content in their digital store, and they can either share content that they pull down from ORME or create their own content and get paid a fee for doing that. The AI engines that we built into the platform are four. First, ORME will serve up content based on individual expressed interest and actual behavior. So the ORME app, when it's opened, opens to content, but the content that one person sees will not be the same based upon what the next person sees, because the AI engine will serve up what that particular person was interested in. There's a second recommendation engine that we built into this.
If someone that is on the app clicks to purchase and the product is sold out, it will recommend a similar product to that person, preserving, hopefully preserving that sale. The third engine is a style chatbot engine. Think of ChatGPT for style. I'm buying a houndstooth coat, and I need to know the best scarf to, to style with it, or I'm going out to X restaurant in L.A. on Sunday and need to know what the best thing to wear is, and it's, it's a place for people to get information about style. Think of it as a personal shopper. And then the last engine is a content filter. We built 30 criteria into the algorithms that monitor content before it actually posts to ORME. So some of the obvious things would be hate speech, nudity, inappropriate language, and 27 other filters that we built into this.
So the machines are looking for things that are not appropriate to be posted up onto ORME. And then going into the market opportunity, pretty much everyone in the retail space knows billions are up for grabs. And in Asia, live stream short-form video sales have grown from $3 billion to $500 billion since 2017, and now accounts for about 25% of all e-commerce in Asia. The reason it's working there and not here is there are no platforms that have built this end-to-end solution, and the forecast for total live stream sales in the U.S. for 2024 are about $35 billion. Half of that will be through linear TV and app, through live streaming online.
Then going to the next slide is what, what's happening in the industry that's disrupting it and has disrupted it over the last 10 years? Everything that you see in the blue boxes here are things that have been occurring over the last 10 years, and most in the industry believe that these things came at us fast. Well, AI is accelerating this at breakneck speed. And just by way of example, Netflix took three years to grow from zero users to 1 million. ChatGPT grew from zero to 1 million in five days, 100 million in one year. In June, 1.6 billion people visited the ChatGPT website. There will be two types of players in AI: creators and appliers. We plan to be a leading applier of AI as ORME grows and moves forward. There will be positives and negatives about AI.
I don't think I need to cover those in this presentation, we all know that. ORME was built to reimagine shopping, entertainment, and social media as social commerce. It switches the retail model fundamentally from the one to many, one retailer to many people, to many people selling many things to many people. So it's a new model for retailing, and ORME leverages every retailer's customers as influencers. So moving to the next slide. ORME solves today's problems. If you look at conversion rates on affiliate marketing today, they're less than 1%. Influencer marketing is about 3%. Live stream shopping conversion rates worldwide on average are 28%. This number was compiled by McKinsey in their recent report. Moving to the next slide.
Now, imagine a platform that combines the best of affiliate digital marketing, influencer marketing with video shopping, and solve the very, very low conversion rate problem. That's what ORME is. Moving to... That's the very last slide?
Yeah. You know—
This is it. Download the app. The future is here, guys, and we are onboarding vendors as we speak. With that, I'll turn it over to Q&A.
Yeah. So we have a few questions, Paul. I don't know if you want to review them, but I'm happy to go through them. You know, one is: Are you still doing beta testing of ORME, and if so, when do you expect to officially launch it?
We are doing beta testing with our own brands. We will turn it on for actual commerce in the next week or so, and then begin to onboard third-party vendors.
So another question: Who would you consider the biggest competitors for ORME in the U.S.? I mean, I can answer that. I think, look, TikTok Shop is spending hundreds of millions of dollars on building their shops out. It'll be interesting to see what happens. If you go on TikTok Shop now, there's a lot of, you know, $10 shirts, you know, in the Shein model. I don't know, and they're also seeing a decline in user engagement because of TikTok Shop. I don't know how that will play out, but I will say, you know, even though they have a lot more money, I think ORME, as a technology, is much cleaner than TikTok Shop, and, you know, I think it's a much more focused center for shopping.
ORME is going to be a destination for shopping, not for funny content, not for, you know, videos of your friends, and I think that is an important differentiator. There's another company called Flip, who we also think has done a nice job with their technology, but again, does not have major brands, and we think that'll be a differentiator for us. Does ORME have patents?
The technology behind ORME has patents filed, and ORME has an exclusive to create marketplaces for with the technology.
There's a question: You recently sold one of your brands for 6 X royalties. Are you considering a sale of any of your other brands?
So we're not considering a sale now. There is a moment that is right to exit assets. We believe there's a tremendous amount of upside in our brands. For instance, Halston, next year, we've only modeled $1.7 million of royalties for 2024. But we believe stabilized royalties, based upon forecasts that G-III has provided in their earnings call, will very quickly get to $8 million. So we see very strong growth over the next two or three years with Halston. We believe that C. Wonder at HSN could double this year from where it was last year, based on plans that we are working on with HSN.
And we believe Christie Brinkley has a lot of upside, as does Longaberger, with putting Longaberger on the ORME platform. It was one of the largest direct sales customer companies in the country, and we believe a lot of the former Longaberger sellers will like what we've built with ORME.
Two more questions. One is: What type of marketing are you doing to create awareness for ORME?
So the strategy is to launch ORME with enough vendors that we have a database of approximately 10 million people that we're going to email. The only obligation that brands have when they come on to ORME is, they have to agree to issue or, or create two emails per week for the first six weeks, introducing all of their customers and all of their salespeople, quite frankly, to ORME. We will provide them with all the marketing assets that they need to do that based on testing over the last year, and we believe 3% of those people will download the app and begin to participate. And based on our testing, the average person will share with 10 people.
So we see ORME as something that will scale to 300,000 users relatively fast, and then if those 300,000 share with 10 people, and those people use the app, that will quickly accelerate to 3 million. And that's the rollout we're hoping for. And when that flywheel begins, then ORME itself will begin to do marketing to deploy the app beyond the launch.
So there's no other questions, Paul, unless there's any on your end?
Yeah. No, just want to remind our viewers, if you do have any further questions, just click that Q&A button at the bottom. But if nothing else is coming in, gentlemen, we want to do thank you for your time and sharing the great story. It's definitely very a lot of exciting things going on. For our audience, if you have any questions after we wrap up here, you can always email us directly at XELB, that's just the ticker symbol, xelb@redchip.com, and we'll absolutely be happy to help you out.
Sounds great. Thank you, Paul, and thank you everyone for joining us today.
Thanks, everybody.