Digital Brands (DBGI) 10-Q 14 Nov 22 2022 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2022	Nov. 14, 2022
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2022
Entity File Number	001-40400
Entity Incorporation, State or Country Code	DE
Entity Registrant Name	Digital Brands Group, Inc.
Entity Tax Identification Number	46-1942864
Entity Address State Or Province	TX
Entity Address, Address Line One	1400 Lavaca Street
Entity Address, City or Town	Austin
Entity Address, Postal Zip Code	78701
City Area Code	209
Local Phone Number	651-0172
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Amendment Flag	false
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Current Fiscal Year End Date	--12-31
Entity Central Index Key	0001668010
Entity Common Stock, Shares Outstanding		0
Entity Shell Company	false
Entity Ex Transition Period	false
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	DBGI
Security Exchange Name	NASDAQ
Warrants, each exercisable to purchase one share of common stock
Document Information [Line Items]
Title of 12(b) Security	Warrants, each exercisable to purchase one share of common stock
Trading Symbol	DBGIW
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Current assets:
Cash and cash equivalents	$ 195,399	$ 528,394
Accounts receivable, net	378,455	89,394
Due from factor, net	638,781	985,288
Inventory	2,655,352	2,755,358
Prepaid expenses and other current assets	940,334	417,900
Total current assets	4,808,321	4,776,334
Deferred offering costs	367,696	367,696
Property, equipment and software, net	46,454	97,265
Goodwill	18,264,822	18,264,822
Intangible assets, net	11,227,876	12,841,313
Deposits	137,794	137,794
Right of use asset	152,387
Total assets	35,005,350	36,485,224
Current liabilities:
Accounts payable	6,945,633	6,562,690
Accrued expenses and other liabilities	3,952,366	2,237,145
Deferred revenue	396,374	276,397
Due to related parties	209,943	277,635
Contingent consideration liability	18,597,831	12,179,476
Convertible note payable, net	8,075,872	100,000
Accrued interest payable	2,103,161	1,110,679
Note payable - related party	179,489	299,489
Venture debt, net of discount		6,001,755
Loan payable, current	1,426,885	2,502,000
Promissory note payable	3,500,000	3,500,000
Right of use liability, current portion	152,387
Total current liabilities	45,539,941	35,047,266
Convertible note payable, net		5,501,614
Loan payable	298,900	713,182
Derivative liability	1,690,807	2,294,720
Warrant liability		18,223
Total liabilities	47,529,648	43,575,005
Commitments and contingencies (Note 11)
Stockholders' equity (deficit):
Common stock, $0.0001 par, 1,000,000,000 shares authorized, 529,492 and 528,742 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively	53	13
Additional paid-in capital	75,440,940	58,614,160
Accumulated deficit	(87,965,292)	(65,703,954)
Total stockholders' equity (deficit)	(12,524,298)	(7,089,781)
Total liabilities and stockholders' equity (deficit)	35,005,350	36,485,224
Undesignated preferred stock
Stockholders' equity (deficit):
Preferred stock
Series A preferred stock
Stockholders' equity (deficit):
Preferred stock
Series A Convertible Preferred Stock
Stockholders' equity (deficit):
Preferred stock	$ 1

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Sep. 30, 2022	Dec. 31, 2021
Undesignated preferred stock
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	9,993,199	10,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Series A preferred stock
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	1	0
Preferred stock, shares issued (in shares)	1
Preferred stock, shares outstanding (in shares)	1	0
Series A Convertible Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	6,800	0
Preferred stock, shares issued (in shares)	6,300
Preferred stock, shares outstanding (in shares)	6,300	0
Common stock
Common stock par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, share authorized (in shares)	1,000,000,000	1,000,000,000
Common stock, share issued (in shares)	529,492	528,742
Common stock, shares outstanding (in shares)	529,492	528,742

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Net revenues	$ 3,424,522	$ 2,163,280	$ 10,595,933	$ 3,575,214
Cost of net revenues	1,771,178	954,137	5,298,011	2,179,023
Gross profit (loss)	1,653,344	1,209,143	5,297,922	1,396,191
Operating expenses:
General and administrative	3,624,841	3,720,863	13,226,308	12,820,841
Sales and marketing	1,225,417	1,307,219	3,971,280	2,401,322
Distribution	97,737	105,332	522,510	238,774
Change in fair value of contingent consideration	(702,885)	3,988,493	6,418,355	7,039,394
Total operating expenses	4,245,110	9,121,907	24,138,453	22,500,331
Loss from operations	(2,591,766)	(7,912,764)	(18,840,531)	(21,104,140)
Other income (expense):
Interest expense	(2,279,016)	(447,842)	(6,050,492)	(2,020,806)
Other non-operating income (expenses)	(23,690)	(577,441)	2,629,685	(634,654)
Total other income (expense), net	(2,302,706)	(1,025,283)	(3,420,807)	(2,655,460)
Income tax benefit (provision)				(1,100,120)
Net loss	$ (4,894,472)	$ (8,938,047)	$ (22,261,338)	$ (22,659,480)
Weighted average common shares outstanding - basic	528,758	117,866	341,229	60,027
Weighted average common shares outstanding - diluted	528,758	117,866	341,229	60,027
Net loss per common share - basic	$ (9.26)	$ (75.83)	$ (65.24)	$ (377.49)
Net loss per common share - diluted	$ (9.26)	$ (75.83)	$ (65.24)	$ (377.49)

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($)	Preferred Stock Series Seed Preferred Stock	Preferred Stock Series A preferred stock	Preferred Stock Series A-2 Preferred Stock	Preferred Stock Series A-3 Preferred Stock	Preferred Stock Series CF Preferred Stock	Preferred Stock Series B Preferred Stock	Preferred Stock Series A Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Total
Beginning balance (in shares) at Dec. 31, 2020	20,714,518	5,654,072	5,932,742	9,032,330	836,331	20,754,717		6,642
Beginning balance at Dec. 31, 2020	$ 2,071	$ 565	$ 593	$ 904	$ 83	$ 2,075		$ 1	$ 27,482,060	$ (33,345,997)	$ (5,857,645)
Stock-based compensation									36,976		36,976
Net loss										(3,023,935)	(3,023,935)
Ending balance at Mar. 31, 2021	$ 2,071	$ 565	$ 593	$ 904	$ 83	$ 2,075		$ 1	27,519,036	(36,369,932)	(8,844,604)
Ending balance (in shares) at Mar. 31, 2021	20,714,518	5,654,072	5,932,742	9,032,330	836,331	20,754,717		6,642
Beginning balance (in shares) at Dec. 31, 2020	20,714,518	5,654,072	5,932,742	9,032,330	836,331	20,754,717		6,642
Beginning balance at Dec. 31, 2020	$ 2,071	$ 565	$ 593	$ 904	$ 83	$ 2,075		$ 1	27,482,060	(33,345,997)	(5,857,645)
Conversion of preferred stock into common stock											6,293
Conversion of debt into common stock											2,680,289
Issuance of common stock pursuant to equity line of credit											367,996
Net loss											(22,659,480)
Ending balance at Sep. 30, 2021								$ 11	57,468,268	(56,005,477)	1,462,801
Ending balance (in shares) at Sep. 30, 2021								126,275
Beginning balance (in shares) at Mar. 31, 2021	20,714,518	5,654,072	5,932,742	9,032,330	836,331	20,754,717		6,642
Beginning balance at Mar. 31, 2021	$ 2,071	$ 565	$ 593	$ 904	$ 83	$ 2,075		$ 1	27,519,036	(36,369,932)	(8,844,604)
Conversion of preferred stock into common stock	$ (2,071)	$ (565)	$ (593)	$ (904)	$ (83)	$ (2,075)		$ 4	6,287
Conversion of preferred stock into common stock (shares)	(20,714,518)	(5,654,072)	(5,932,742)	(9,032,330)	(836,331)	(20,754,717)		40,272
Issuance of common stock in public offering								$ 2	10,000,000		10,000,002
Issuance of common stock in public offering (in shares)								24,096
Offering costs									(2,116,957)		(2,116,957)
Exercise of over-allotment option, net of offering costs									1,364,997		1,364,997
Exercise of over-allotment option, net of offering costs (in shares)								3,614
Conversion of debt into common stock								$ 1	2,680,288		2,680,289
Conversion of debt into common stock (In shares)								11,352
Conversion of related party notes and payables into common stock									257,515		257,515
Conversion of related party notes and payables into common stock (in shares)								1,524
Common stock and warrants issued in connection with note									73,958		73,958
Common stock and warrants issued in connection with note (in shares)								200
Common stock issued in connection with business combination								$ 2	8,025,540		8,025,542
Common stock issued in connection with business combination (in shares)								21,928
Exercise of warrants									145,696		145,696
Exercise of warrants (in shares)								319
Common stock issued pursuant to consulting agreement									183,000		183,000
Common stock issued pursuant to consulting agreement (in shares)								500
Stock-based compensation									3,801,553		3,801,553
Net loss										(10,697,498)	(10,697,498)
Ending balance at Jun. 30, 2021								$ 10	51,940,914	(47,067,430)	4,873,493
Ending balance (in shares) at Jun. 30, 2021								110,446
Issuance of common stock in public offering									367,696		367,696
Issuance of common stock in public offering (in shares)								1,264
Common stock issued in connection with business combination								$ 1	3,403,195		3,403,196
Common stock issued in connection with business combination (in shares)								11,015
Exercise of warrants									1,622,350		1,622,350
Exercise of warrants (in shares)								3,550
Stock-based compensation									134,113		134,113
Net loss										(8,938,047)	(8,938,047)
Ending balance at Sep. 30, 2021								$ 11	57,468,268	(56,005,477)	1,462,801
Ending balance (in shares) at Sep. 30, 2021								126,275
Beginning balance (in shares) at Dec. 31, 2021								130,017
Beginning balance at Dec. 31, 2021								$ 13	58,614,160	(65,703,954)	(7,089,781)
Stock-based compensation									139,093		139,093
Net loss										(7,832,942)	(7,832,942)
Conversion of notes into common stock								$ 1	1,201,581		1,201,582
Conversion of notes into common stock (in shares)								8,739
Ending balance at Mar. 31, 2022								$ 14	59,954,834	(73,536,896)	(13,582,048)
Ending balance (in shares) at Mar. 31, 2022								138,756
Beginning balance (in shares) at Dec. 31, 2021								130,017
Beginning balance at Dec. 31, 2021								$ 13	58,614,160	(65,703,954)	(7,089,781)
Conversion of debt into common stock											1,802,372
Net loss											(22,261,338)
Ending balance at Sep. 30, 2022							$ 1	$ 53	75,440,940	(87,965,292)	(12,524,298)
Ending balance (in shares) at Sep. 30, 2022		1					6,300	529,492
Beginning balance (in shares) at Mar. 31, 2022								138,756
Beginning balance at Mar. 31, 2022								$ 14	59,954,834	(73,536,896)	(13,582,048)
Issuance of common stock in public offering								$ 37	9,347,413		9,347,450
Issuance of common stock in public offering (in shares)								373,898
Offering costs									(1,930,486)		(1,930,486)
Stock-based compensation									119,759		119,759
Net loss										(9,533,924)	(9,533,924)
Conversion of notes and derivative liability into common stock								$ 2	600,788		600,790
Conversion of notes and derivative liability into common stock (in shares)								16,088
Warrants issued in connection with note									98,241		98,241
Ending balance at Jun. 30, 2022								$ 53	68,190,549	(83,070,820)	(14,880,218)
Ending balance (in shares) at Jun. 30, 2022								528,742
Common stock issued pursuant to consulting agreement									123,000		123,000
Common stock issued pursuant to consulting agreement (in shares)								750
Stock-based compensation									110,093		110,093
Net loss										(4,894,472)	(4,894,472)
Warrants issued in connection with note									692,299		692,299
Issuance of Series A preferred stock									25,000		25,000
Issuance of Series A preferred stock (in shares)		1
Conversion of venture debt into Series A convertible preferred stock							$ 1		6,299,999		6,300,000
Conversion of venture debt into Series A convertible preferred stock (in shares)							6,300
Ending balance at Sep. 30, 2022							$ 1	$ 53	$ 75,440,940	$ (87,965,292)	$ (12,524,298)
Ending balance (in shares) at Sep. 30, 2022		1					6,300	529,492

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Cash flows from operating activities:
Net loss	$ (22,261,338)	$ (22,659,480)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	1,669,782	652,732
Amortization of loan discount and fees	4,610,234	682,956
Stock-based compensation	491,945	4,155,641
Fees incurred in connection with debt financings	48,245	132,609
Change in fair value of warrant liability	(18,223)	21,930
Change in fair value of derivative liability	(794,477)	627,956
Change in fair value of contingent consideration	6,418,355	7,039,394
Forgiveness of Payroll Protection Program	(1,760,755)
Deferred income tax benefit		(1,100,120)
Change in credit reserve	(26,429)	66,748
Changes in operating assets and liabilities:
Accounts receivable, net	(289,061)	(32,582)
Due from factor, net	433,671	(540,257)
Inventory	100,006	(483,477)
Prepaid expenses and other current assets	(522,434)	(1,259,835)
Accounts payable	382,943	749,352
Accrued expenses and other liabilities	1,715,221	451,298
Deferred revenue	119,977	(78,492)
Accrued compensation - related party		(108,550)
Accrued interest	992,482	206,163
Net cash used in operating activities	(8,689,857)	(11,476,015)
Cash flows from investing activities:
Cash acquired (consideration) pursuant to business combination		(5,442,966)
Purchase of property, equipment and software	(5,533)	(13,585)
Deposits		(67,431)
Net cash used in investing activities	(5,533)	(5,523,982)
Cash flows from financing activities:
Proceeds (repayments) from related party advances	(162,692)
Advances (repayments) from factor	(60,735)	(39,520)
Proceeds from venture debt	237,500
Issuance of loans payable	248,858	2,626,050
Repayments of convertible and promissory notes	(3,068,750)	(2,002,731)
Issuance of convertible notes payable	3,751,250	5,078,650
Proceeds from initial public offering	9,347,450	10,000,002
Exercise of over-allotment option with public offering, net		1,364,997
Exercise of warrants		1,768,046
Offering costs	(1,930,486)	(2,116,957)
Net cash provided by financing activities	8,362,395	16,678,537
Net increase in cash and cash equivalents	(332,995)	(321,460)
Cash and cash equivalents at beginning of period	528,394	575,986
Cash and cash equivalents at end of period	195,399	254,526
Supplemental disclosure of cash flow information:
Cash paid for interest	318,576	460,179
Supplemental disclosure of non-cash investing and financing activities:
Conversion of notes into common stock	1,802,372	2,680,289
Right of use asset	152,387
Warrants issued in connection with note	790,540
Derivative liability in connection with convertible note	559,957	1,858,887
Conversion of related party notes and payables into preferred and common stock	25,000	257,515
Conversion of venture debt into preferred stock	$ 6,300,000
Conversion of preferred stock into common stock		6,293
Common shares issued pursuant to equity line of credit		$ 367,996

NATURE OF OPERATIONS

NATURE OF OPERATIONS	9 Months Ended
	Sep. 30, 2022
NATURE OF OPERATIONS
NATURE OF OPERATIONS	NOTE 1: NATURE OF OPERATIONS Digital Brands Group, Inc. (the “Company” or “DBG”), was organized on September 17, 2012 under the laws of Delaware as a limited liability company under the name Denim.LA LLC. The Company converted to a Delaware corporation on January 30, 2013 and changed its name to Denim.LA, Inc. Effective December 31, 2020, the Company changed its name to Digital Brands Group, Inc. (DBG). The Company is a curated collection of lifestyle brands, including Bailey 44, DSTLD, Harper & Jones, Stateside and ACE Studios, that offers a variety of apparel products through direct-to-consumer and wholesale distribution. On February 12, 2020, Denim.LA, Inc. entered into an Agreement and Plan of Merger with Bailey 44, LLC (“Bailey”), a Delaware limited liability company. On the acquisition date, Bailey 44, LLC became a wholly owned subsidiary of the Company. On May 18, 2021, the Company closed its acquisition of Harper & Jones, LLC (“H&J”) pursuant to its Membership Interest Stock Purchase Agreement with D. Jones Tailored Collection, Ltd. to purchase 100% of the issued and outstanding equity of Harper & Jones, LLC. On the acquisition date, H&J became a wholly owned subsidiary of the Company. On August 30, 2021, the Company closed its acquisition of Mosbest, LLC dba Stateside (“Stateside”) pursuant to its Membership Interest Purchase Agreement with Moise Emquies to purchase 100% of the issued and outstanding equity of Stateside. On the acquisition date, Stateside became a wholly owned subsidiary of the Company.

GOING CONCERN

GOING CONCERN	9 Months Ended
	Sep. 30, 2022
GOING CONCERN
GOING CONCERN	NOTE 2: GOING CONCERN The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has not generated profits since inception, has sustained net losses of $22,261,338 and $22,659,480 for the nine months ended September 30, 2022 and 2021, respectively, and has incurred negative cash flows from operations during these periods. The Company has historically lacked liquidity to satisfy obligations as they come due and as of September 30, 2022, and the Company had a working capital deficit of $40,731,620. These factors raise substantial doubt about the Company’s ability to continue as a going concern. The Company requires significant capital to fund operations and meet its obligations as demands are made. The Company expects to continue to generate operating losses for the foreseeable future. The accompanying consolidated financial statements do not include any adjustments as a result of this uncertainty. Management Plans In August 2021, the Company entered into an equity line of credit agreement which the investor is committed to purchase up to $17,500,000 of the Company’s common stock. The Company plans to utilize multiple drawdowns on this agreement, however, it may be unable to execute on such drawdowns due to restrictions per the agreement.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”). Stock Split On October 21, 2022, the Board of Directors approved a one Unaudited Interim Financial Information The accompanying unaudited condensed consolidated balance sheet as of September 30, 2022, the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021 and of cash flows for the nine months ended September 30, 2022 and 2021 have been prepared by the Company, pursuant to the rules and regulations of the SEC for the interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. The unaudited interim consolidated financial statements have been prepared on a basis consistent with the audited consolidated financial statements and in the opinion of management, reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the consolidated results for the interim periods presented and of the consolidated financial condition as of the date of the interim consolidated balance sheet. The results of operations are not necessarily indicative of the results expected for the year ended December 31, 2022. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2021 included in the Company’s Annual Form 10-K filed with SEC on March 31, 2022. Principles of Consolidation These condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries Bailey, H&J and Stateside from the dates of acquisition. All inter-company transactions and balances have been eliminated on consolidation. Use of Estimates The preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, inventory, impairment of long-lived assets, contingent consideration and derivative liabilities. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates when there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates. Cash and Equivalents and Concentration of Credit Risk The Company considers all highly liquid securities with an original maturity of less than three months to be cash equivalents. As of September 30, 2022 and December 31, 2021, the Company did not hold any cash equivalents. The Company’s cash and cash equivalents in bank deposit accounts, at times, may exceed federally insured limits of $250,000. Fair Value of Financial Instruments The Company’s financial instruments consist of cash and cash equivalents, prepaid expenses, accounts payable, accrued expenses, due to related parties, related party note payable, and convertible debt. The carrying value of these assets and liabilities is representative of their fair market value, due to the short maturity of these instruments. The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicates the level of the fair value hierarchy used to determine such fair values: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of September 30, 2022 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ — ​ $ — ​ $ — Contingent consideration ​ — ​ — ​ 18,597,831 ​ 18,597,831 Derivative liability ​ ​ — ​ ​ — ​ ​ 1,690,807 ​ ​ 1,690,807 ​ ​ $ — ​ $ — ​ $ 20,288,638 ​ $ 20,288,638 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of December 31, 2021 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ 18,223 ​ $ — ​ $ 18,223 Contingent consideration ​ ​ — ​ ​ — ​ ​ 12,179,476 ​ ​ 12,179,476 Derivative liability ​ ​ — ​ ​ — ​ ​ 2,294,720 ​ ​ 2,294,720 ​ ​ $ — ​ $ 18,223 ​ $ 14,474,196 ​ $ 14,492,419 ​ Contingent Consideration Changes in acquisition-related contingent consideration liabilities during the nine months ended September 30, 2022 are as follows: ​ ​ ​ ​ ​ ​ Contingent ​ ​ Consideration ​ ​ Liability Outstanding as of December 31, 2021 ​ $ 12,179,476 Change in fair value ​ 6,418,355 Outstanding as of September 30, 2022 ​ $ 18,597,831 ​ The detail of contingent consideration by company is as follows: ​ ​ ​ ​ ​ Bailey $ 10,698,475 Harper & Jones ​ 7,899,356 ​ ​ $ 18,597,831 ​ The contingent consideration liabilities were revalued as of May 18, 2022, the anniversary date of the Company’s initial public offering. As of the date of the issuance of these financial statements, the contingent consideration liabilities were not yet settled with shares. On July 29, 2022, the Company entered into an amendment to the May 2021 purchase agreement with the H&J Seller based on the ultimate settlement of the H&J contingent consideration. Pursuant to the amendment, on May 18, 2023, the Company shall deliver to the H&J Seller additional shares of common stock. The number of shares of common stock to be delivered to H&J Seller shall be calculated as follows: $7,899,356 minus any cash payments received by Seller from any capital raises, divided by the average common stock closing price per share based on the thirty-day trading period preceding May 19, 2023. Derivative Liability In connection with the Company’s convertible notes with Oasis Capital, LLC (“Oasis”) and FirstFire Global Opportunities Fund, LLC (“FirstFire”), as well as its convertible notes entered into in July 2022, the Company recorded a derivative liability (see Note 7). The estimated fair value of the derivative liability is recorded using significant unobservable measures and other fair value inputs and is therefore classified as a Level 3 financial instrument. The fair value of the derivative liability is valued using a multinomial lattice model. The multinomial lattice inputs include the underlying stock price, volatility of common stock and remaining term of the convertible note. Changes in derivative liability during the nine months ended September 30, 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ Derivative ​ Liability Outstanding as of December 31, 2021 ​ $ 2,294,720 Issuane of convertible notes ​ ​ 559,957 Conversion of underlying notes into common stock ​ ​ (369,393) Change in fair value ​ (794,477) Outstanding as of September 30, 2022 ​ $ 1,690,807 ​ Inventory Inventory is stated at the lower of cost or net realizable value and accounted for using the weighted average cost method for DSTLD and first-in, first-out method for Bailey and Stateside. The inventory balances as of September 30, 2022 and December 31, 2021 consist substantially of finished good products purchased or produced for resale, as well as any raw materials the Company purchased to modify the products and work in progress. Inventory consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Raw materials $ 435,025 $ 292,167 Work in process ​ 256,078 ​ 242,673 Finished goods ​ 1,964,248 ​ 2,220,519 Inventory ​ $ 2,655,352 ​ $ 2,755,358 ​ Goodwill Goodwill and identifiable intangible assets that have indefinite useful lives are not amortized, but instead are tested annually for impairment and upon the occurrence of certain events or substantive changes in circumstances. The annual goodwill impairment test allows for the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. An entity may choose to perform the qualitative assessment on none, some or all of its reporting units or an entity may bypass the qualitative assessment for any reporting unit and proceed directly to step one of the quantitative impairment test. If it is determined, on the basis of qualitative factors, that the fair value of a reporting unit is, more likely than not, less than its carrying value, the quantitative impairment test is required. Deferred Offering Costs The Company complies with the requirements of ASC 340, Other Assets and Deferred Costs, with regards to offering costs. Prior to the completion of an offering, offering costs are capitalized. The deferred offering costs are charged to additional paid-in capital or as a discount to debt, as applicable, upon the completion of an offering or to expense if the offering is not completed As of September 30, 2022 and December 31, 2021, the Company capitalized $367,696 in deferred offering costs pertaining to its equity line of credit agreement with Oasis (Note 8). Management is currently reviewing the feasibility of drawdowns on the equity line of credit. Net Loss per Share Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. As all potentially dilutive securities are anti-dilutive as of September 30, 2022 and 2021, diluted net loss per share is the same as basic net loss per share for each year. Potentially dilutive items outstanding as of September 30, 2022 and 2021 are as follows: ​ ​ ​ ​ ​ ​ ​ September 30, ​ ​ 2022 2021 Convertible notes 1,177,305 22,404 Series A convertible preferred stock ​ 108 ​ — Common stock warrants 132,114 35,913 Stock options 38,951 38,751 Total potentially dilutive shares 1,348,477 97,069 ​ The stock options and warrants above are out-of-the-money as of September 30, 2022. net income. Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02: Leases (Topic 842). The new guidance generally requires an entity to recognize on its balance sheet operating and financing lease liabilities and corresponding right-of-use assets. The standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2018 and early adoption is permitted. The new standard requires a modified retrospective transition for existing leases to each prior reporting period presented. The Company has elected to utilize the extended adoption period available to the Company as an emerging growth company and has not currently adopted this standard. This standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2021. The Company has adopted ASU 2016-02 as of January 1, 2022. See Note 10. Management does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances. Unaudited Pro Forma Financial Information The following unaudited pro forma financial information presents the Company’s financial results as if the H&J and Stateside acquisitions had occurred as of January 1, 2021. The unaudited pro forma financial information is not necessarily indicative of what the financial results actually would have been had the acquisitions been completed on this date. In addition, the unaudited pro forma financial information is not indicative of, nor does it purport to project, the Company’s future financial results. The following unaudited pro forma financial information includes incremental property and equipment depreciation and intangible asset amortization as a result of the acquisitions. The pro forma information does not give effect to any estimated and potential cost savings or other operating efficiencies that could result from the acquisition:

DUE FROM FACTOR

DUE FROM FACTOR	9 Months Ended
	Sep. 30, 2022
DUE FROM FACTOR
DUE FROM FACTOR	NOTE 4: DUE FROM FACTOR Due to/from factor consist of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Outstanding receivables: ​ $ 423,984 ​ $ 579,295 Without recourse ​ 83,224 ​ 361,584 With recourse ​ 182,352 ​ 121,617 Advances ​ ​ (50,779) ​ ​ (77,208) Credits due customers ​ $ 638,781 ​ $ 985,288 ​

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS	9 Months Ended
	Sep. 30, 2022
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS	NOTE 5: GOODWILL AND INTANGIBLE ASSETS The Company recorded $6,479,218 in goodwill from the Bailey business combination in February 2020, $9,681,548 in goodwill from the H&J business combination in May 2021 and $2,104,056 in goodwill from the Stateside business combination in August 2021. The following table summarizes information relating to the Company’s identifiable intangible assets as of September 30, 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross Accumulated Carrying ​ ​ Amount ​ Amortization ​ Value Amortized: ​ ​ ​ Customer relationships ​ $ 6,453,750 ​ ​ (3,062,794) ​ $ 3,390,956 ​ ​ 6,453,750 ​ (3,062,794) ​ 3,390,956 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Indefinite-lived: ​ ​ ​ ​ ​ ​ Brand name ​ $ 7,836,920 ​ — ​ 7,836,920 ​ ​ $ 14,290,670 ​ $ (3,062,794) ​ $ 11,227,876 ​ The Company recorded amortization expense of $537,813 and $355,808 during the three months ended September 30, 2022 and 2021, and $1,613,438 and $590,711 during the nine months ended September 30, 2022 and 2021, respectively, which is included in general and administrative expenses in the consolidated statements of operations.

LIABILITIES AND DEBT

LIABILITIES AND DEBT	9 Months Ended
	Sep. 30, 2022
LIABILITIES AND DEBT
LIABILITIES AND DEBT	NOTE 6: LIABILITIES AND DEBT Accrued Expenses and Other Liabilities The Company accrued expenses and other liabilities line in the consolidated balance sheets is comprised of the following as of September 30, 2022 and December 31,2021: ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Accrued expenses ​ $ 896,043 ​ $ 213,740 Reserve for returns ​ 24,673 ​ 33,933 Payroll related liabilities ​ 2,602,800 ​ 1,204,665 Sales tax liability ​ 298,149 ​ 268,723 Due to seller ​ ​ — ​ ​ 396,320 Other liabilities ​ 130,702 ​ 119,764 ​ ​ $ 3,952,366 ​ $ 2,237,145 ​ Certain liabilities including sales tax and payroll related liabilities may be subject to interest and penalties. As of September 30, 2022 and December 31, 2021, payroll related labilities included approximately $262,000 in estimated penalties associated with accrued payroll taxes. Venture Debt In February 2022, the Company received $237,500 in proceeds, including loan fees of $12,500, from the existing venture debt lender under the same terms as the existing facility. As of June 30, 2022 and December 31, 2021, the gross loan balance was $6,251,755 and $6,001,755, respectively. On September 29, 2022, the Company and Black Oak Capital executed a Securities Purchase Agreement (the “Black Oak SPA”) whereby the Company issued 6,300 shares of Series A Convertible Preferred Stock to Black Oak for $1,000 per share (see Note 7). The shares were issued pursuant to the conversion of Black Oak’s entire principal amount of $6,251,755, and the Company recorded $48,245 in interest as part of the conversion. Pursuant to the Black Oak SPA, all accrued interest remaining outstanding. Accrued interest was $269,880 as of September 30, 2022. For the nine months ended September 30, 2022 and 2021, $12,500 and $147,389 of loan fees and discounts from warrants were amortized to interest expense, leaving unamortized balance of $0 as of September 30, 2022. Interest expense and effective interest rate on this loan for the three months ended September 30, 2022 and 2021, was $191,152 and $189,096, and 12.2% and 13.4% all respectively. Interest expense was $573,455 and $591,123 for the nine months ended September 30, 2022 and 2021, respectively. Convertible Debt 2020 Regulation D Offering As of September 30, 2022 and December 31, 2021, there was $100,000 remaining in outstanding principal that was not converted into equity. Convertible Promissory Note During the nine months ended September 30, 2022, the Company converted an aggregate of $1,432,979 in outstanding principal into 24,827 shares of common stock. On April 8, 2022, the Company and various purchasers executed a Securities Purchase Agreement whereby the investors purchased from the Company convertible promissory notes in the aggregate principal amount of $3,068,750, consisting of original issue discount of $613,750. The Company received net proceeds of $2,313,750 after the original issue discount and fees, resulting in a debt discount of $755,000. Upon the Company’s public offering in May (see below), the Company repaid $3,068,750 to the investors and the debt discount was fully amortized. In connection with the April notes, the Company issued an aggregate of 12,577 warrants to purchase common stock at an exercise price of $122 per share. The Company recognized $98,241 as a debt discount for the fair value of the warrants using the Black-Scholes option model, which was fully amortized upon the notes’ repayment in May. On July 22 and July 28, 2022, the Company and various purchasers executed a Securities Purchase Agreement whereby the investors purchased from the Company convertible promissory notes in the aggregate principal amount of $1,875,000, consisting of original issue discount of $375,000. The Company received net proceeds of $1,450,000 after the original issue discount and fees. The July notes matured on October 31, 2022 and are in default as of the date of these financial statements. In connection with the July 22 and July 28 notes, the Company issued an aggregate of 41,124 and 27,655 warrants to purchase common stock at an exercise price of $15.20 and $11.30 per share, respectively. The Company recognized $692,299 as a debt discount for the fair value of the warrants using the Black-Scholes option model, which will be amortized to interest expense over the life of the notes. If the July notes are not repaid in full by the maturity date or if any other event of default occurs, (1) the face value of the notes will be automatically increase d to 120%; (2) the notes will begin generating an annual interest rate of 20%, which will be paid in cash monthly until the default is cured; and (3) if such default continues for 14 or more calendar days, at the Investors’ discretion, the notes shall become convertible at the option of the investors into shares of the Company’s common stock at a conversion price equal to the closing price of the Company’s common stock on the on the date of the note conversion. The Company evaluated the terms of the conversion features of the July notes as noted above in accordance with ASC Topic No. 815 — 40, Derivatives and Hedging — Contracts in Entity’s Own Stock During the three and nine months ended September 30, 2022, the Company amortized $1,792,060 and $4,575,234, respectively, of debt discount to interest expense. As of September 30, 2022 and December 31, 2021, the outstanding principal was $9,907,121 and $9,465,000, respectively. The balance of the convertible notes, after unamortized debt discount of 1,931,149, was $7,975,872 as of September 30, 2022. Loan Payable — PPP and SBA Loan As of September 30, 2022 and December 31, 2021, H&J had an outstanding loan under the EIDL program of $148,900. In April 2022, Bailey received notification of full forgiveness of its 2 nd st Note Payable – Related Party As of September 30, 2022, H&J had an outstanding note payable of $140,928 owned by the H&J Seller. The note matures on December 10, 2022 and bears interest at 12% per annum. Promissory Note Payable As of September 30, 2022 and December 31, 2021, the outstanding principal on the note to the sellers of Bailey was $3,500,000. As of September 30, 2022, the lender agreed to defer all payments to the maturity date of the loan, December 31, 2022. Interest expense was $105,000 and $105,000 for the three months ended September 30, 2022 and 2021 and $315,000 and $389,000 for the nine months ended September 30, 2022 and 2021, all respectively, which was accrued and unpaid as of September 30, 2022. Merchant Cash Advances In March 2022, the Company obtained two short-term merchant advances, which totaled $500,000 and $250,000, respectively, from a single lender to fund operations. These advances included origination fees totaling $22,500 for net proceeds of $727,500. These advances are, for the most part, secured by expected future sales transactions of the Company with expected payments on a weekly basis The Company will repay an aggregate of $1,065,000 to the lender. These advances contain various financial and non-financial covenants. In the third quarter of 2022, the Company received additional short-term advances of $607,860. As of September 30, 2022, $279,475 remained outstanding. As of the date of these financial statements, the Company was in compliance with these covenants.

STOCKHOLDERS' DEFICIT

STOCKHOLDERS' DEFICIT	9 Months Ended
	Sep. 30, 2022
STOCKHOLDERS' DEFICIT
STOCKHOLDERS' DEFICIT	NOTE 7: STOCKHOLDERS’ DEFICIT On August 31, 2022, the Company entered into a Subscription and Investment Representation Agreement with Hil Davis, its Chief Executive Officer, pursuant to which the Company agreed to issue 1 share of the Company's Series A Preferred Stock to for $25,000. The issuance of the preferred stock reduced the due to related party balance. The share of Series A Preferred Stock had 250,000,000 votes per share and voted together with the outstanding shares of the Company’s common stock as a single class exclusively with respect to any proposals to amend the Certificate of Incorporation to effect a reverse stock split of the Company’s common stock and to increase the authorized number of shares of the Company’s common stock. The terms of the Series A Preferred Stock provided that the outstanding share of Series A Preferred Stock would be redeemed in whole, but not in part, at any time: (i) if such redemption is ordered by the Board of Directors in its sole discretion or (ii) automatically upon the approval of Proposals 2 and 6 presented at the Company’s 2022 annual shareholders meeting. Following conclusion of the shareholders meeting, such share of the Company’s Series A Preferred Stock was redeemed. On October 13, 2022, the outstanding share of the Company’s Series A Preferred Stock was redeemed. During the nine months ended September 30, 2022, $1,432,979 in outstanding principal of convertible notes were converted into 24,827 shares of common stock. In September 2022, the Company issued 750 shares of common stock pursuant to a consultant agreement at a fair value of $123,000. On September 29, 2022, the Company and Black Oak Capital executed a Securities Purchase Agreement (the “Black Oak SPA”) whereby the Company issued 6,300 shares of Series A Convertible Preferred Stock to Black Oak for $1,000 per share. The following is a summary of the rights and preferences of the Series A Convertible Preferred Stock. Series A Convertible Preferred Stock On September 29, 2022, the Company filed the Certificate of Designation designating up to 6,800 shares out of the authorized but unissued shares of its preferred stock as Series A Convertible Preferred Stock. Except for stock dividends or distributions for which adjustments are to be made pursuant to the Certificate of Designation, the holders of the Series A Preferred Stock (the “Holders”) shall be entitled to receive, and the Company shall pay, dividends on shares of the Series A Preferred Stock equal (on an as-if-converted-to-Common-Stock basis) to and in the same form as dividends actually paid on shares of the Common Stock when, as and if such dividends are paid on shares of the Common Stock. No other dividends shall be paid on shares of the Series A Preferred Stock. With respect to any vote with the class of Common Stock, each share of the Series A Preferred Stock shall entitle the Holder thereof to cast that number of votes per share as is equal to the number of shares of Common Stock into which it is then convertible. The Series A Preferred Stock shall rank (i) senior to all of the Common Stock; (ii) senior to any class or series of capital stock of the Company hereafter created specifically ranking by its terms junior to any Preferred Stock (“Junior Securities”); (iii) on parity with any class or series of capital stock of the Corporation created specifically ranking by its terms on parity with the Preferred Stock (“Parity Securities”); and (iv) junior to any class or series of capital stock of the Company hereafter created specifically ranking by its terms senior to any Preferred Stock (“Senior Securities”), in each case, as to dividends or distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily. Each share of the Series A Preferred Stock shall be convertible, at any time and from time to time from and after September 29, 2022 at the option of the Holder thereof, into that number of shares of Common Stock determined by dividing the Stated Value of such share of the Series A Preferred Stock ($1,000 as of September 29, 2022) by the Conversion Price. The conversion price for each share of the Series A Preferred Stock is the closing price of the Common Stock on September 29, 2022, which was $9.30. Amendment to Articles of Incorporation On October 13, 2022, the Company amended its Amended and Restated Certificate of Incorporation to increase to increase the number of authorized shares of the Company’s common stock from 200,000,000 to 1,000,000,000, and in conjunction therewith, to increase the aggregate number of authorized shares to 1,010,000,000 shares. See Note 12. On October 21, 2022, the Board of Directors approved a one Underwriting Agreement and Public Offering On May 5, 2022, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Alexander Capital, L.P., acting as representative (the “Representative”) of the several underwriters named in the Underwriting Agreement (the “Underwriters”), relating to the Company’s underwritten the offering (the “Offering”) pursuant to which the Company agreed to issue and sell 373,898 shares (the “Firm Shares”) of the Company’s common stock. The Firm Shares were sold to the public at a combined public offering price of $2.50 per share and were purchased by the Underwriters from the Company at a price of $2.30 per share. The Company also granted the Underwriters a 45-day The shares were sold in the Offering pursuant to a Registration Statement on Form S-1, as amended (File No. 333-264347) (the “Registration Statement”), a Registration Statement on Form S-1 pursuant to 462(b) of the Securities Act of 1933, as amended (File No. 333-264775), and a related prospectus filed with the Securities and Exchange Commission. The public offering closed on May 10, 2022 and the Company sold 373,898 shares of Common Stock for total gross proceeds of $9.3 million. The Company received net proceeds of $8.1 million after deducting underwriters’ discounts and commissions of $0.7 million and direct offering expenses of $0.5 million.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2022
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	NOTE 8: RELATED PARTY TRANSACTIONS Employee Backpay, Loans Receivable and Loans Payable As of September 30, 2022 and December 31, 2021, due to related parties includes advances from the former officer, Mark Lynn, who also serves as a director, totaling $104,568, and accrued salary and expense reimbursements of $120,350 and $126,706, respectively, to current officers. As of June 30, 2022, due to related parties also included an advance of $25,000 from the CEO. In August 2022, the Company issued 1 share of Series A preferred stock to the CEO for $25,000. Accordingly, the due to related parties balance was reduced to $0. As of September 30, 2022, H&J had an outstanding note payable of $140,928 owned by the H&J Seller.

SHARE-BASED PAYMENTS

SHARE-BASED PAYMENTS	9 Months Ended
	Sep. 30, 2022
SHARE-BASED PAYMENTS
SHARE-BASED PAYMENTS	NOTE 9: SHARE-BASED PAYMENTS Common Stock Warrants In connection with the April note agreement, the Company granted warrants to acquire 12,577 shares of common stock at an exercise price of $122.00 per share expiring in April 2027. On May 10, 2022, pursuant to the Underwriting Agreement, the Company issued the Underwriters’ Warrants to purchase up to an aggregate of 14,956 shares of common stock. The Underwriters’ Warrants may be exercised beginning on November 1, 2022 until May 5, 2027. The initial exercise price of each Underwriters’ Warrant is $32.50 per share, which represents 130% of the public offering price. In connection with the July 22 and July 28 notes, the Company issued an aggregate of 41,124 and 27,655 warrants to purchase common stock at an exercise price of $15.20 and $11.30 per share, respectively. The warrants expire in July 2027. The following is a summary of warrant activity: ​ ​ ​ ​ ​ ​ ​ ​ Common Weighted ​ ​ Stock ​ Average ​ ​ Warrants ​ Exercise Price Outstanding - December 31, 2021 ​ 35,801 ​ $ 412.00 Granted ​ 96,313 ​ 30.71 Exercised ​ — ​ ​ ​ Forfeited ​ — ​ ​ Outstanding - September 30, 2022 ​ 132,114 ​ $ 134.13 Exercisable at September 30, 2022 ​ 104,459 ​ $ 166.65 ​ Stock Options As of September 30, 2022 and December 31, 2021, the Company had 38,951 stock options outstanding with a weighted average exercise price of $362.11 per share. As of September 30, 2022, there were 34,073 options exercisable. Stock-based compensation expense of $110,092 and $134,113 was recognized for the three months ended September 30, 2022 and 2021, and $368,944 and $4,155,641 was recognized for the nine months September 30, 2022 and 2021, respectively. During the nine months ended September 30,2022 and 2021, $43,196 and $5375,550 was recorded to sales and marketing expense, and all other stock compensation was included in general and administrative expense in the condensed consolidated statements of operations. Total unrecognized compensation cost related to non-vested stock option awards as of September 30, 2022 amounted to $688,092 and will be recognized over a weighted average period of 1.56 years.

LEASE OBLIGATIONS

LEASE OBLIGATIONS	9 Months Ended
	Sep. 30, 2022
LEASE OBLIGATIONS
LEASE OBLIGATIONS	NOTE 10: LEASE OBLIGATIONS In April 2021, the Company entered into a lease agreement for operating space in Los Angeles, California. The lease expires in June 2023 and has monthly base rent payments of $17,257. The lease required a $19,500 deposit. The Company adopted ASC 842 on January 1, 2021 and recognized a right of use asset Stateside leases office and showroom facilities in Los Angeles, California. The leases expire at various dates through November 2022 with base rents ranging from $3,100 to $9,000. Total rent expense for the three months ended September 30, 2022 and 2021 was $267,041 and $246,103, and $736,523 and $551,944 for the nine months end September 30, 2022 and 2021, respectively.

CONTINGENCIES

CONTINGENCIES	9 Months Ended
	Sep. 30, 2022
CONTINGENCIES
CONTINGENCIES	NOTE 11: CONTINGENCIES On March 25, 2020, a Bailey’s product vendor filed a lawsuit against Bailey for non-payment of trade payables totaling $492,390. Approximately the same amount was held in accounts payable for this vendor in the accompanying consolidated balance sheets and the Company does not believe it is probable that losses in excess of such trade payables will be incurred. The Company and product vendor have entered into a settlement, which will require the Company make ten monthly payments of approximately $37,000, starting in May 2021. Upon completion of the payment schedule, any remaining amounts will be forgiven. The payment schedule was completed in 2022. On December 21, 2020, a Company investor filed a lawsuit against DBG for reimbursement of their investment totaling $100,000. Claimed amounts are included in short-term convertible note payable in the accompanying consolidated balance sheets and the Company does not believe it is probable that losses in excess of such short-term note payable will be incurred. The Company is actively working to resolve this matter. In August 2020 and March 2021, two lawsuits were filed against Bailey’s by third-party’s related to prior services rendered. The claims (including fines, fees, and legal expenses) total an aggregate of $96,900. One matter was settled in February 2022 and the other matter is being actively worked on to achieve settlement. On September 24, 2020 a Bailey’s product vendor filed a lawsuit against Bailey’s non-payment of trade payables totaling approximately $481,000 and additional damages of approximately $296,000. Claimed amounts for trade payables are included in accounts payable in the accompanying consolidated balance sheets, net of payments made. In December 2021, the Company reached a settlement; however, the settlement terms were not met and a judgement was entered against the Company in the amount of $469,000. All claims above, to the extent management believes it will be liable, have been included in accounts payable and accrued expenses and other liabilities in the consolidated balance sheet as of September 30, 2022. Except as may be set forth above the Company is not a party to any legal proceedings, and the Company is not aware of any claims or actions pending or threatened against us. In the future, the Company might from time to time become involved in litigation relating to claims arising from its ordinary course of business, the resolution of which the Company does not anticipate would have a material adverse impact on our financial position, results of operations or cash flows.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2022
SUBSEQUENT EVENTS.
SUBSEQUENT EVENTS	NOTE 12: SUBSEQUENT EVENTS Management’s Evaluation On October 13, 2022, Digital Brands Group, Inc., a Delaware corporation (the “Company” or “DBG”), entered into a Second Amended and Restated Membership Interest Purchase Agreement (the “Agreement”) with Moise Emquies, George Levy, Matthieu Leblan and Carol Ann Emquies (“Sellers”), Sunnyside, LLC, a California limited liability company (“Sundry”), and George Levy as the Sellers’ representative (the “Sellers’ Representative”), pursuant to which the Company will acquire all of the issued and outstanding membership interests of Sundry (such transaction, the “Acquisition”). Pursuant to the Agreement, Sellers, as the holders of all of the outstanding membership interests of Sundry, will exchange all of such membership interests for (i) $7.5 million in cash, of which (a) $2.5 million Leblan (for a total of $5 million); (b) $900,000 will be used to pay off outstanding indebtedness of Sundry and (c) the remaining $1.6 million will be paid to each of the Sellers, Jenny Murphy and Elodie Crichi pro rata in accordance to the percentages set forth in the Agreement; (ii) $5.5 million in promissory notes issued by the Company to each of the Sellers, Jenny Murphy and Elodie Crichi pro rata in accordance to the percentage set forth in the Agreement; and (iii) $1 million paid in the Company's common stock, with a par value of $0.0001 per share (the “Buyer Shares”), at $11 per share, which is the per share closing price of the Buyer Shares on Nasdaq on October 13, 2022 (the “Issuance Price”) issued to each of the Sellers, Jenny Murphy and Elodie Crichi pro rata in accordance to the percentage set forth in the Agreement. Each promissory note carries an initial per annual interest rate of eight percent (8)% and a maturity date of February 15, 2023. On October 13, 2022, the Company amended its Amended and Restated Certificate of Incorporation to increase to increase the number of authorized shares of the Company’s common stock from 200,000,000 to 1,000,000,000, and in conjunction therewith, to increase the aggregate number of authorized shares to 1,010,000,000 shares. On October 21, 2022, the Board of Directors approved a one From October 1, 2022 through the issuance date, the Company has converted approximately $5.5 million of the Oasis and FirstFire notes into 543,845 shares of common stock.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation	Basis of Presentation The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (“GAAP”).
Stock Split	Stock Split On October 21, 2022, the Board of Directors approved a one
Unaudited Interim Financial Information	Unaudited Interim Financial Information The accompanying unaudited condensed consolidated balance sheet as of September 30, 2022, the unaudited condensed consolidated statements of operations for the three and nine months ended September 30, 2022 and 2021 and of cash flows for the nine months ended September 30, 2022 and 2021 have been prepared by the Company, pursuant to the rules and regulations of the SEC for the interim financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to rules and regulations. However, the Company believes that the disclosures are adequate to make the information presented not misleading. The unaudited interim consolidated financial statements have been prepared on a basis consistent with the audited consolidated financial statements and in the opinion of management, reflect all adjustments, consisting of only normal recurring adjustments, necessary for the fair presentation of the consolidated results for the interim periods presented and of the consolidated financial condition as of the date of the interim consolidated balance sheet. The results of operations are not necessarily indicative of the results expected for the year ended December 31, 2022. The accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2021 included in the Company’s Annual Form 10-K filed with SEC on March 31, 2022.
Principles of Consolidation	Principles of Consolidation These condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries Bailey, H&J and Stateside from the dates of acquisition. All inter-company transactions and balances have been eliminated on consolidation.
Use of Estimates	Use of Estimates The preparation of the Company’s financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Significant estimates and assumptions reflected in these financial statements include, but are not limited to, inventory, impairment of long-lived assets, contingent consideration and derivative liabilities. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates when there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. Actual results could differ from those estimates.
Cash and Equivalents and Concentration of Credit Risk	Cash and Equivalents and Concentration of Credit Risk The Company considers all highly liquid securities with an original maturity of less than three months to be cash equivalents. As of September 30, 2022 and December 31, 2021, the Company did not hold any cash equivalents. The Company’s cash and cash equivalents in bank deposit accounts, at times, may exceed federally insured limits of $250,000.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company’s financial instruments consist of cash and cash equivalents, prepaid expenses, accounts payable, accrued expenses, due to related parties, related party note payable, and convertible debt. The carrying value of these assets and liabilities is representative of their fair market value, due to the short maturity of these instruments. The following tables present information about the Company’s financial assets and liabilities measured at fair value on a recurring basis and indicates the level of the fair value hierarchy used to determine such fair values: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of September 30, 2022 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ — ​ $ — ​ $ — Contingent consideration ​ — ​ — ​ 18,597,831 ​ 18,597,831 Derivative liability ​ ​ — ​ ​ — ​ ​ 1,690,807 ​ ​ 1,690,807 ​ ​ $ — ​ $ — ​ $ 20,288,638 ​ $ 20,288,638 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of December 31, 2021 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ 18,223 ​ $ — ​ $ 18,223 Contingent consideration ​ ​ — ​ ​ — ​ ​ 12,179,476 ​ ​ 12,179,476 Derivative liability ​ ​ — ​ ​ — ​ ​ 2,294,720 ​ ​ 2,294,720 ​ ​ $ — ​ $ 18,223 ​ $ 14,474,196 ​ $ 14,492,419 ​ Contingent Consideration Changes in acquisition-related contingent consideration liabilities during the nine months ended September 30, 2022 are as follows: ​ ​ ​ ​ ​ ​ Contingent ​ ​ Consideration ​ ​ Liability Outstanding as of December 31, 2021 ​ $ 12,179,476 Change in fair value ​ 6,418,355 Outstanding as of September 30, 2022 ​ $ 18,597,831 ​ The detail of contingent consideration by company is as follows: ​ ​ ​ ​ ​ Bailey $ 10,698,475 Harper & Jones ​ 7,899,356 ​ ​ $ 18,597,831 ​ The contingent consideration liabilities were revalued as of May 18, 2022, the anniversary date of the Company’s initial public offering. As of the date of the issuance of these financial statements, the contingent consideration liabilities were not yet settled with shares. On July 29, 2022, the Company entered into an amendment to the May 2021 purchase agreement with the H&J Seller based on the ultimate settlement of the H&J contingent consideration. Pursuant to the amendment, on May 18, 2023, the Company shall deliver to the H&J Seller additional shares of common stock. The number of shares of common stock to be delivered to H&J Seller shall be calculated as follows: $7,899,356 minus any cash payments received by Seller from any capital raises, divided by the average common stock closing price per share based on the thirty-day trading period preceding May 19, 2023. Derivative Liability In connection with the Company’s convertible notes with Oasis Capital, LLC (“Oasis”) and FirstFire Global Opportunities Fund, LLC (“FirstFire”), as well as its convertible notes entered into in July 2022, the Company recorded a derivative liability (see Note 7). The estimated fair value of the derivative liability is recorded using significant unobservable measures and other fair value inputs and is therefore classified as a Level 3 financial instrument. The fair value of the derivative liability is valued using a multinomial lattice model. The multinomial lattice inputs include the underlying stock price, volatility of common stock and remaining term of the convertible note. Changes in derivative liability during the nine months ended September 30, 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ Derivative ​ Liability Outstanding as of December 31, 2021 ​ $ 2,294,720 Issuane of convertible notes ​ ​ 559,957 Conversion of underlying notes into common stock ​ ​ (369,393) Change in fair value ​ (794,477) Outstanding as of September 30, 2022 ​ $ 1,690,807
Inventory	Inventory Inventory is stated at the lower of cost or net realizable value and accounted for using the weighted average cost method for DSTLD and first-in, first-out method for Bailey and Stateside. The inventory balances as of September 30, 2022 and December 31, 2021 consist substantially of finished good products purchased or produced for resale, as well as any raw materials the Company purchased to modify the products and work in progress. Inventory consisted of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Raw materials $ 435,025 $ 292,167 Work in process ​ 256,078 ​ 242,673 Finished goods ​ 1,964,248 ​ 2,220,519 Inventory ​ $ 2,655,352 ​ $ 2,755,358
Goodwill	Goodwill Goodwill and identifiable intangible assets that have indefinite useful lives are not amortized, but instead are tested annually for impairment and upon the occurrence of certain events or substantive changes in circumstances. The annual goodwill impairment test allows for the option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. An entity may choose to perform the qualitative assessment on none, some or all of its reporting units or an entity may bypass the qualitative assessment for any reporting unit and proceed directly to step one of the quantitative impairment test. If it is determined, on the basis of qualitative factors, that the fair value of a reporting unit is, more likely than not, less than its carrying value, the quantitative impairment test is required.
Deferred Offering Costs	Deferred Offering Costs The Company complies with the requirements of ASC 340, Other Assets and Deferred Costs, with regards to offering costs. Prior to the completion of an offering, offering costs are capitalized. The deferred offering costs are charged to additional paid-in capital or as a discount to debt, as applicable, upon the completion of an offering or to expense if the offering is not completed As of September 30, 2022 and December 31, 2021, the Company capitalized $367,696 in deferred offering costs pertaining to its equity line of credit agreement with Oasis (Note 8). Management is currently reviewing the feasibility of drawdowns on the equity line of credit.
Net Loss per Share	Net Loss per Share Net earnings or loss per share is computed by dividing net income or loss by the weighted-average number of common shares outstanding during the period, excluding shares subject to redemption or forfeiture. The Company presents basic and diluted net earnings or loss per share. Diluted net earnings or loss per share reflect the actual weighted average of common shares issued and outstanding during the period, adjusted for potentially dilutive securities outstanding. Potentially dilutive securities are excluded from the computation of the diluted net loss per share if their inclusion would be anti-dilutive. As all potentially dilutive securities are anti-dilutive as of September 30, 2022 and 2021, diluted net loss per share is the same as basic net loss per share for each year. Potentially dilutive items outstanding as of September 30, 2022 and 2021 are as follows: ​ ​ ​ ​ ​ ​ ​ September 30, ​ ​ 2022 2021 Convertible notes 1,177,305 22,404 Series A convertible preferred stock ​ 108 ​ — Common stock warrants 132,114 35,913 Stock options 38,951 38,751 Total potentially dilutive shares 1,348,477 97,069 ​ The stock options and warrants above are out-of-the-money as of September 30, 2022. net income.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In February 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-02: Leases (Topic 842). The new guidance generally requires an entity to recognize on its balance sheet operating and financing lease liabilities and corresponding right-of-use assets. The standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2018 and early adoption is permitted. The new standard requires a modified retrospective transition for existing leases to each prior reporting period presented. The Company has elected to utilize the extended adoption period available to the Company as an emerging growth company and has not currently adopted this standard. This standard will be effective for the first interim period within annual reporting periods beginning after December 15, 2021. The Company has adopted ASU 2016-02 as of January 1, 2022. See Note 10. Management does not believe that any other recently issued, but not yet effective, accounting standards could have a material effect on the accompanying financial statements. As new accounting pronouncements are issued, the Company will adopt those that are applicable under the circumstances. Unaudited Pro Forma Financial Information The following unaudited pro forma financial information presents the Company’s financial results as if the H&J and Stateside acquisitions had occurred as of January 1, 2021. The unaudited pro forma financial information is not necessarily indicative of what the financial results actually would have been had the acquisitions been completed on this date. In addition, the unaudited pro forma financial information is not indicative of, nor does it purport to project, the Company’s future financial results. The following unaudited pro forma financial information includes incremental property and equipment depreciation and intangible asset amortization as a result of the acquisitions. The pro forma information does not give effect to any estimated and potential cost savings or other operating efficiencies that could result from the acquisition:

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	Sep. 30, 2022
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Schedule of financial assets and liabilities measured at fair value on recurring basis	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of September 30, 2022 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ — ​ $ — ​ $ — Contingent consideration ​ — ​ — ​ 18,597,831 ​ 18,597,831 Derivative liability ​ ​ — ​ ​ — ​ ​ 1,690,807 ​ ​ 1,690,807 ​ ​ $ — ​ $ — ​ $ 20,288,638 ​ $ 20,288,638 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements ​ ​ as of December 31, 2021 Using: ​ Level 1 Level 2 Level 3 Total Liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Warrant liability ​ $ — ​ $ 18,223 ​ $ — ​ $ 18,223 Contingent consideration ​ ​ — ​ ​ — ​ ​ 12,179,476 ​ ​ 12,179,476 Derivative liability ​ ​ — ​ ​ — ​ ​ 2,294,720 ​ ​ 2,294,720 ​ ​ $ — ​ $ 18,223 ​ $ 14,474,196 ​ $ 14,492,419
Schedule of changes in acquisition-related contingent consideration	​ ​ ​ ​ ​ ​ Contingent ​ ​ Consideration ​ ​ Liability Outstanding as of December 31, 2021 ​ $ 12,179,476 Change in fair value ​ 6,418,355 Outstanding as of September 30, 2022 ​ $ 18,597,831 ​ ​ ​ ​ ​ Bailey $ 10,698,475 Harper & Jones ​ 7,899,356 ​ ​ $ 18,597,831
Schedule of changes in derivative liability	​ ​ ​ ​ ​ ​ ​ Derivative ​ Liability Outstanding as of December 31, 2021 ​ $ 2,294,720 Issuane of convertible notes ​ ​ 559,957 Conversion of underlying notes into common stock ​ ​ (369,393) Change in fair value ​ (794,477) Outstanding as of September 30, 2022 ​ $ 1,690,807
Schedule of inventory	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Raw materials $ 435,025 $ 292,167 Work in process ​ 256,078 ​ 242,673 Finished goods ​ 1,964,248 ​ 2,220,519 Inventory ​ $ 2,655,352 ​ $ 2,755,358
Schedule of potentially dilutive items outstanding	​ ​ ​ ​ ​ ​ ​ September 30, ​ ​ 2022 2021 Convertible notes 1,177,305 22,404 Series A convertible preferred stock ​ 108 ​ — Common stock warrants 132,114 35,913 Stock options 38,951 38,751 Total potentially dilutive shares 1,348,477 97,069

DUE FROM FACTOR (Tables)

DUE FROM FACTOR (Tables)	9 Months Ended
	Sep. 30, 2022
DUE FROM FACTOR
Schedule of due to/ from factor	​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Outstanding receivables: ​ $ 423,984 ​ $ 579,295 Without recourse ​ 83,224 ​ 361,584 With recourse ​ 182,352 ​ 121,617 Advances ​ ​ (50,779) ​ ​ (77,208) Credits due customers ​ $ 638,781 ​ $ 985,288

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS (Tables)	9 Months Ended
	Sep. 30, 2022
GOODWILL AND INTANGIBLE ASSETS
Summary of amortized and indefinite-lived intangible assets	​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross Accumulated Carrying ​ ​ Amount ​ Amortization ​ Value Amortized: ​ ​ ​ Customer relationships ​ $ 6,453,750 ​ ​ (3,062,794) ​ $ 3,390,956 ​ ​ 6,453,750 ​ (3,062,794) ​ 3,390,956 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Indefinite-lived: ​ ​ ​ ​ ​ ​ Brand name ​ $ 7,836,920 ​ — ​ 7,836,920 ​ ​ $ 14,290,670 ​ $ (3,062,794) ​ $ 11,227,876

LIABILITIES AND DEBT (Tables)

LIABILITIES AND DEBT (Tables)	9 Months Ended
	Sep. 30, 2022
LIABILITIES AND DEBT
Schedule of accrued expenses and other liabilities	​ ​ ​ ​ ​ ​ ​ ​ ​ September 30, December 31, ​ ​ 2022 ​ 2021 Accrued expenses ​ $ 896,043 ​ $ 213,740 Reserve for returns ​ 24,673 ​ 33,933 Payroll related liabilities ​ 2,602,800 ​ 1,204,665 Sales tax liability ​ 298,149 ​ 268,723 Due to seller ​ ​ — ​ ​ 396,320 Other liabilities ​ 130,702 ​ 119,764 ​ ​ $ 3,952,366 ​ $ 2,237,145

SHARE-BASED PAYMENTS (Tables)

SHARE-BASED PAYMENTS (Tables)	9 Months Ended
	Sep. 30, 2022
SHARE-BASED PAYMENTS
Summary of information related to common stock and preferred stock warrants	​ ​ ​ ​ ​ ​ ​ ​ Common Weighted ​ ​ Stock ​ Average ​ ​ Warrants ​ Exercise Price Outstanding - December 31, 2021 ​ 35,801 ​ $ 412.00 Granted ​ 96,313 ​ 30.71 Exercised ​ — ​ ​ ​ Forfeited ​ — ​ ​ Outstanding - September 30, 2022 ​ 132,114 ​ $ 134.13 Exercisable at September 30, 2022 ​ 104,459 ​ $ 166.65

NATURE OF OPERATIONS (Details)

NATURE OF OPERATIONS (Details)	Aug. 30, 2021	May 18, 2021
Harper & Jones LLC
NATURE OF OPERATIONS
Percentage of equity acquired		100%
Stateside
NATURE OF OPERATIONS
Percentage of equity acquired	100%

GOING CONCERN (Details)

GOING CONCERN (Details) - USD ($)	3 Months Ended						9 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Sep. 30, 2022	Sep. 30, 2021	Aug. 31, 2021
Net loss	$ (4,894,472)	$ (9,533,924)	$ (7,832,942)	$ (8,938,047)	$ (10,697,498)	$ (3,023,935)	$ (22,261,338)	$ (22,659,480)
Working capital deficit	$ (40,731,620)						$ (40,731,620)
Equity purchase agreement
Value of common stock to be issued under the agreement									$ 17,500,000

SUMMARY OF SIGNIFICANT ACCOUN_4

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	Oct. 21, 2022	Sep. 30, 2022 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Cash and cash equivalents in bank deposit		$ 250,000
Subsequent Events
Summary Of Significant Accounting Policies [Line Items]
Reverse stock split conversion ratio	0.01

SUMMARY OF SIGNIFICANT ACCOUN_5

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Fair Value of Financial Instruments (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021	Jul. 29, 2022
Liabilities:
Warrant liability		$ 18,223
Contingent consideration	$ 18,597,831	12,179,476
Derivative liability	1,690,807	2,294,720
Total	20,288,638	14,492,419
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Outstanding as of December 31, 2021	12,179,476
Change in fair value	6,418,355
Outstanding as of September 30, 2022	18,597,831	12,179,476
Harper & Jones, LLC
Liabilities:
Contingent consideration	7,899,356		$ 7,899,356
Bailey LLC.
Liabilities:
Contingent consideration	10,698,475
Level 2
Liabilities:
Warrant liability		18,223
Total		18,223
Level 3
Liabilities:
Contingent consideration	18,597,831	12,179,476
Derivative liability	1,690,807	2,294,720
Total	$ 20,288,638	$ 14,474,196

SUMMARY OF SIGNIFICANT ACCOUN_6

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Derivative Liability (Details)	9 Months Ended
	Sep. 30, 2022 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Outstanding as of December 31, 2021	$ 12,179,476
Change in fair value	6,418,355
Outstanding as of September 30, 2022	18,597,831
Derivative Liability
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Outstanding as of December 31, 2021	2,294,720
Issuane of convertible notes	559,957
Conversion of underlying notes into common stock	(369,393)
Change in fair value	(794,477)
Outstanding as of September 30, 2022	$ 1,690,807

SUMMARY OF SIGNIFICANT ACCOUN_7

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Inventory (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Raw materials	$ 435,025	$ 292,167
Work in process	256,078	242,673
Finished goods	1,964,248	2,220,519
Inventory	$ 2,655,352	$ 2,755,358

SUMMARY OF SIGNIFICANT ACCOUN_8

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deferred Offering Costs (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Deferred offering costs capitalized	$ 367,696	$ 367,696

SUMMARY OF SIGNIFICANT ACCOUN_9

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Net Loss per Share (Details) - shares	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total potentially dilutive shares	1,348,477	97,069
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total potentially dilutive shares	38,951	38,751
Convertible notes
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total potentially dilutive shares	1,177,305	22,404
Series A convertible preferred stock
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total potentially dilutive shares	108
Common stock warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share
Total potentially dilutive shares	132,114	35,913

DUE FROM FACTOR (Details)

DUE FROM FACTOR (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Outstanding receivables:
Without recourse	$ 423,984	$ 579,295
With recourse	83,224	361,584
Advances	182,352	121,617
Credits due customers	(50,779)	(77,208)
Due from factor	$ 638,781	$ 985,288

GOODWILL AND INTANGIBLE ASSET_2

GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($)	1 Months Ended		3 Months Ended		9 Months Ended
	May 31, 2021	Feb. 29, 2020	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021	Aug. 31, 2021
Indefinite-lived Intangible Assets
Gross Amount			$ 6,453,750		$ 6,453,750
Accumulated Amortization			(3,062,794)		(3,062,794)
Carrying Value			3,390,956		3,390,956
Indefinite-lived			14,290,670		14,290,670
Intangible assets, net			11,227,876		11,227,876		$ 12,841,313
Amortization expense			537,813	$ 355,808	1,613,438	$ 590,711
Goodwill			18,264,822		18,264,822		$ 18,264,822
Bailey
Indefinite-lived Intangible Assets
Goodwill acquired		$ 6,479,218
H&J acquisition
Indefinite-lived Intangible Assets
Goodwill acquired	$ 9,681,548
Stateside
Indefinite-lived Intangible Assets
Goodwill								$ 2,104,056
Customer relationships
Indefinite-lived Intangible Assets
Gross Amount			6,453,750		6,453,750
Accumulated Amortization			(3,062,794)		(3,062,794)
Carrying Value			3,390,956		3,390,956
Brand name
Indefinite-lived Intangible Assets
Indefinite-lived			$ 7,836,920		$ 7,836,920

LIABILITIES AND DEBT - Accrued

LIABILITIES AND DEBT - Accrued Expenses and Other Liabilities (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
LIABILITIES AND DEBT
Accrued expenses	$ 896,043	$ 213,740
Reserve for returns	24,673	33,933
Payroll related liabilities	2,602,800	1,204,665
Sales tax liability	298,149	268,723
Due to seller		396,320
Other liabilities	130,702	119,764
Accrued expenses and other liabilities, Total	3,952,366	2,237,145
Estimated penalties associated with accrued payroll taxes	$ 262,000	$ 262,000

LIABILITIES AND DEBT - Venture

LIABILITIES AND DEBT - Venture Debt (Details) - USD ($)		1 Months Ended	3 Months Ended		9 Months Ended
	Sep. 29, 2021	Feb. 28, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 29, 2022	Jun. 30, 2022	Dec. 31, 2021
Line of Credit Facility
Gross proceeds received					$ 237,500
Outstanding principal amount of debt converted					1,432,979
Venture Debt
Line of Credit Facility
Interest expense			$ 191,152	$ 189,096	573,455	$ 591,123
Interest expense and effective interest rate			12.20%	13.40%
Venture Debt | Black Oak SPA
Line of Credit Facility
Outstanding principal amount of debt converted	$ 6,251,755
Accrued interest			$ 269,880		269,880		$ 48,245
Venture Debt | Note Warrant
Line of Credit Facility
Loan fees and discounts from warrants were amortized to interest expense					12,500	$ 147,389
Loan fees and discounts from warrants unamortized balance					$ 0
Venture Debt | Secured Debt
Line of Credit Facility
Gross proceeds received		$ 237,500
Amended Venture Debt | Secured Debt
Line of Credit Facility
Loan fees		$ 12,500
Gross loan								$ 6,251,755	$ 6,001,755

LIABILITIES AND DEBT - Converti

LIABILITIES AND DEBT - Convertible Debt (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Convertible Debt 2020 Regulation D Offering
Debt Instrument
Outstanding principal and accrued interest upon closing of IPO	$ 100,000	$ 100,000

LIABILITIES AND DEBT - Conver_2

LIABILITIES AND DEBT - Convertible Promissory Note (Details) - USD ($)				3 Months Ended	9 Months Ended		12 Months Ended
	Jul. 28, 2022	Jul. 22, 2022	Apr. 08, 2022	Sep. 30, 2022	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Debt Instrument
Percentage of annual interest rate					20%
Derivative liability in connection with convertible note					$ 559,957	$ 1,858,887
Repayments of debt					$ 3,068,750	$ 2,002,731
Number of shares resulting from conversion					24,827
Outstanding principal amount of convertible debt converted					$ 1,432,979
Derivative liability at fair value				$ 1,690,807	1,690,807		$ 2,294,720
Outstanding principal amount					9,907,121		$ 9,465,000
Oasis Note
Debt Instrument
Amortization of debt discount					7,975,872
Derivative liability at fair value				1,931,149	1,931,149
Convertible Promissory Note
Debt Instrument
Amortization of debt discount				$ 1,792,060	$ 4,575,234
Number of shares resulting from conversion					24,827
Outstanding principal amount of convertible debt converted					$ 1,432,979
Convertible Promissory Note | Securities Purchase Agreement
Debt Instrument
Aggregate principal amount	$ 1,875,000	$ 1,875,000	$ 3,068,750
Original issue discount	375,000	375,000	613,750
Net proceeds after the original issue discount and fees	$ 1,450,000	$ 1,450,000	2,313,750
Debt discount			755,000
Repayments of debt			3,068,750
April notes
Debt Instrument
Debt discount			$ 98,241
Warrants issued to purchase common stock			12,577	12,577	12,577
Exercise price of warrants			$ 122	$ 122	$ 122
July 2022 notes
Debt Instrument
Debt discount				$ 692,299	$ 692,299
Percentage of increase in face value					120%
July 22 notes | Securities Purchase Agreement
Debt Instrument
Warrants issued to purchase common stock				41,124	41,124
Exercise price of warrants				$ 15.20	$ 15.20
July 28 notes | Securities Purchase Agreement
Debt Instrument
Warrants issued to purchase common stock				27,655	27,655
Exercise price of warrants				$ 11.30	$ 11.30

LIABILITIES AND DEBT - Loan Pay

LIABILITIES AND DEBT - Loan Payable - PPP and SBA Loan (Details) - USD ($)	1 Months Ended
	Apr. 30, 2022	Sep. 30, 2022	Dec. 31, 2021
Harper & Jones LLC
Debt Instrument
Aggregate principal amount		$ 140,928
Promissory note, annual interest rate (as a percent)			12%
Economic Injury Disaster Loan
Debt Instrument
Aggregate principal amount		$ 148,900	$ 148,900
1st PPP loan | Bailey LLC.
Debt Instrument
Loan forgiveness amount	$ 413,705
2nd PPP loan | Bailey LLC.
Debt Instrument
Loan forgiveness amount	$ 1,347,050

LIABILITIES AND DEBT - Promisso

LIABILITIES AND DEBT - Promissory Note Payable (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Mar. 31, 2022	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Debt Instrument
Gross proceeds received				$ 237,500
Outstanding balance		$ 1,426,885		1,426,885		$ 2,502,000
Promissory note payable
Debt Instrument
Outstanding balance		279,475		279,475
Promissory note payable | Notes Payable to Banks
Debt Instrument
Interest expense		105,000	$ 105,000	315,000	$ 389,000
Promissory note payable | Notes Payable to Banks | Bailey LLC.
Debt Instrument
Aggregate principal amount		3,500,000		$ 3,500,000		$ 3,500,000
Merchant Cash Advances
Debt Instrument
Aggregate principal amount	$ 500,000
Repayment of outstanding principal amount	1,065,000
Gross proceeds received	250,000
Net proceeds	22,500
Additional short term advances		$ 607,860
Merchant Cash Advances | Common Stock
Debt Instrument
Net proceeds	$ 727,500

STOCKHOLDERS' DEFICIT (Details)

STOCKHOLDERS' DEFICIT (Details)							1 Months Ended		3 Months Ended		9 Months Ended
	Oct. 21, 2022	Sep. 29, 2022 USD ($) $ / shares shares	Aug. 31, 2022 USD ($) shares	May 10, 2022 USD ($) shares	May 05, 2022 $ / shares shares	Sep. 29, 2021 USD ($)	Sep. 30, 2022 USD ($) shares	Aug. 31, 2022 USD ($) shares	Sep. 30, 2022 USD ($) shares	Jun. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) shares	Oct. 13, 2022 shares	Oct. 12, 2022 shares	Dec. 31, 2021 USD ($) shares
Class of Stock
Outstanding principal amount of convertible debt converted | $											$ 1,432,979
Proceeds from issuance of common stock | $				$ 8,100,000
Net proceeds of after deducting underwriting discounts and commissions | $				700,000
Direct offering expenses | $				$ 500,000
Common stock issued pursuant to consulting agreement (in shares)							750
Common stock issued pursuant to consulting agreement | $							$ 123,000		$ 123,000	$ 183,000
Number of shares resulting from conversion											24,827
Common stock, Shares authorized (in shares)													200,000,000
Subsequent event
Class of Stock
Common stock, Shares authorized (in shares)												1,000,000,000	200,000,000
Aggregate number of authorized shares (in shares)												1,010,000,000
Reverse stock split conversion ratio	0.01
Venture Debt | Black Oak SPA
Class of Stock
Outstanding principal amount of convertible debt converted | $						$ 6,251,755
Series A Convertible Preferred Stock
Class of Stock
Preferred stock, shares outstanding							6,300		6,300		6,300			0
Shares designated (in shares)		6,800
Stated Value | $		$ 1,000					$ 1		$ 1		$ 1
Conversion price (in dollars per share) | $ / shares		$ 9.30
Series A Convertible Preferred Stock | Venture Debt | Black Oak SPA
Class of Stock
Number of shares resulting from conversion		6,300
Debt conversion price (in dollars per share) | $ / shares		$ 1,000
Series A preferred stock
Class of Stock
Preferred stock, shares outstanding							1		1		1			0
Stated Value | $
Series A preferred stock | Chief Executive Officer
Class of Stock
Number of share sold or issued on closing of Public Offering			1					1
Value of shares issued | $			$ 25,000					$ 25,000
Preferred stock, shares outstanding			250,000,000					250,000,000
Initial Public Offering
Class of Stock
Share price | $ / shares					$ 2.50
Number of shares agreed to issued and sell					373,898
Issue price (in dollars per share) | $ / shares					$ 2.30
Number of option days granted to purchase an additional shares					45 days
Number of share sold or issued on closing of Public Offering				373,898
Maximum number of additional shares allowed to purchase within 45 option days					56,085
Gross proceeds from the offering | $				$ 9,300,000

RELATED PARTY TRANSACTIONS - Du

RELATED PARTY TRANSACTIONS - Due to Related Parties (Details) - USD ($)	Sep. 30, 2022	Dec. 31, 2021
Advances
Due to related parties
Advance due to related parties	$ 104,568	$ 104,568
Accrued Salary
Due to related parties
Advance due to related parties	120,350	120,350
Expense Reimbursements
Due to related parties
Advance due to related parties	$ 126,706	$ 126,706

RELATED PARTY TRANSACTIONS - No

RELATED PARTY TRANSACTIONS - Note Payable (Details) - Chief Executive Officer - USD ($)		1 Months Ended
	Aug. 31, 2022	Aug. 31, 2022	Sep. 30, 2022	Jun. 30, 2022
Related Party Transaction
Due to related parties			$ 0	$ 25,000
Series A preferred stock
Related Party Transaction
Number of share sold or issued on closing of Public Offering	1	1
Value of shares issued	$ 25,000	$ 25,000
Notes Payable, Other Payables | Note Payable, Chief Executive Officer
Related Party Transaction
Aggregate principal amount			$ 140,928

SHARE-BASED PAYMENTS - Common S

SHARE-BASED PAYMENTS - Common Stock Warrants - General Information (Details) - $ / shares	May 10, 2022	Sep. 30, 2022	Apr. 08, 2022
April notes
Class of Warrant or Right
Number of common shares to be acquired on exercise of warrants		12,577	12,577
Warrants exercise price		$ 122	$ 122
July 22 notes | Securities Purchase Agreement
Class of Warrant or Right
Number of common shares to be acquired on exercise of warrants		41,124
Warrants exercise price		$ 15.20
July 28 notes | Securities Purchase Agreement
Class of Warrant or Right
Number of common shares to be acquired on exercise of warrants		27,655
Warrants exercise price		$ 11.30
Underwriters Warrants
Class of Warrant or Right
Number of common shares to be acquired on exercise of warrants	14,956
Percentage of initial exercise price representing the public offering price	130%
Warrants exercise price	$ 32.50

SHARE-BASED PAYMENTS - Stock-ba

SHARE-BASED PAYMENTS - Stock-based Compensation - Stock options granted (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award
Option outstanding	38,951		38,951		38,951
Option outstanding exercise price (in dollars per share)	$ 362.11		$ 362.11		$ 362.11
Option exercisable	34,073		34,073
Stock-based compensation expense	$ 110,092	$ 134,113	$ 368,944	$ 4,155,641
Unrecognized compensation cost related to non-vested stock option	$ 688,092		$ 688,092
Share-based arrangement, non-vested weighted average period			1 year 6 months 21 days
Sales and Marketing Expense
Share-based Compensation Arrangement by Share-based Payment Award
Stock-based compensation expense			$ 43,196	$ 5,375,550

SHARE-BASED PAYMENTS - Warrants

SHARE-BASED PAYMENTS - Warrants Roll Forward (Details) - Common stock warrants	9 Months Ended
	Sep. 30, 2022 $ / shares shares
Class of Warrant or Right
Warrant Outstanding Beginning Balance | shares	35,801
Granted | shares	96,313
Warrant Outstanding Ending Balance | shares	132,114
Common Stock Warrants Exercisable | shares	104,459
Weighted Average Exercise Price Outstanding Beginning Balance | $ / shares	$ 412
Granted | $ / shares	30.71
Weighted Average Exercise Price Outstanding Ending Balance | $ / shares	134.13
Weighted Average Exercise Price Exercisable | $ / shares	$ 166.65

LEASE OBLIGATIONS (Details)

LEASE OBLIGATIONS (Details) - USD ($)	1 Months Ended	3 Months Ended		9 Months Ended
	Apr. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Operating lease agreements
Rent expense	$ 17,257	$ 267,041	$ 246,103	$ 736,523	$ 551,944
Security deposit	$ 19,500
Right of use asset		$ 152,387		152,387
Discount rate	6%
Accounting Standards Update 2016-02
Operating lease agreements
Operating lease liability	$ 250,244
Right of use asset	$ 250,244
Stateside
Operating lease agreements
Maximum Rent base				9,000
Minimum Rent base				$ 3,100

CONTINGENCIES (Details)

CONTINGENCIES (Details)				1 Months Ended
	Dec. 21, 2020 USD ($)	Sep. 24, 2020 USD ($)	Mar. 25, 2020 USD ($) item	Feb. 28, 2022 item	Dec. 31, 2021 USD ($)	Mar. 31, 2021 USD ($) item	Aug. 31, 2020 USD ($) item
Litigation Matters
Settlement amount payable to vendor			$ 37,000
Number of monthly payments to be made | item			10
Lawsuits filed related to prior services rendered
Litigation Matters
Damages sought						$ 96,900	$ 96,900
Number of lawsuits filed | item						2	2
Number of lawsuit settled | item				1
Non-payment of trade payables
Litigation Matters
Damages sought			$ 492,390
Non-payment of trade payables | Lawsuits filed related to prior services rendered
Litigation Matters
Damages sought		$ 481,000
Additional damages sought		$ 296,000
Judgement received					$ 469,000
Reimbursement Of Investment
Litigation Matters
Damages sought	$ 100,000

SUBSEQUENT EVENTS (Details)

SUBSEQUENT EVENTS (Details)	Oct. 21, 2022	Oct. 13, 2022 USD ($) $ / shares shares	Oct. 01, 2022 USD ($) shares	Oct. 12, 2022 shares	Sep. 30, 2022 $ / shares shares	Dec. 31, 2021 $ / shares shares
Subsequent Event
Common stock, share authorized (in shares) | shares				200,000,000
Common Stock
Subsequent Event
Buyer Shares, par value (in dollars per share) | $ / shares					$ 0.0001	$ 0.0001
Common stock, share authorized (in shares) | shares					1,000,000,000	1,000,000,000
Subsequent event
Subsequent Event
Common stock, share authorized (in shares) | shares		1,000,000,000		200,000,000
Aggregate number of authorized shares (in shares) | shares		1,010,000,000
Reverse stock split conversion ratio	0.01
Subsequent event | Sundry
Subsequent Event
Consideration in cash		$ 7,500,000
Cash consideration used to pay off outstanding indebtedness of acquiree		900,000
Consideration in paid in shares		$ 1,000,000
Buyer Shares, par value (in dollars per share) | $ / shares		$ 0.0001
Buyer Shares, issuance price (in dollars per share) | $ / shares		$ 11
Promissory note, annual interest rate (as a percent)		8%
Subsequent event | Sundry | George Levy And Matthieu Leblan [Member]
Subsequent Event
Consideration in cash		$ 5,000,000
Subsequent event | Sundry | George Levy
Subsequent Event
Consideration in cash		2,500,000
Subsequent event | Sundry | Matthieu Leblan
Subsequent Event
Consideration in cash		2,500,000
Subsequent event | Sundry | Jenny Murphy and Elodie Crichi
Subsequent Event
Consideration in cash		1,600,000
Consideration in promissory notes		$ 5,500,000
Subsequent event | Common Stock
Subsequent Event
Converted common stock value			$ 5,500,000
Converted common stock shares | shares			543,845