My firstminute | Jenny Fleiss, Rent The Runway & JetBlack

Jennifer Fleiss is an entrepreneur who has founded and scaled two digitally native businesses from scratch: Rent the Runway and Jetblack.

Rent the Runway was co-founded in 2009 by Fleiss and Jenn Hyman. In 2009, they disrupted the trillion-dollar fashion industry and changed how women get dressed forever by pioneering the ‘Closet in the Cloud’: a dream closet filled with an infinite selection of designer styles to rent, wear and return. 

In this episode from May 2020, we explored the earliest days of Jenny's career, starting in financial services, the subsequent journey which resulted in co-founding her businesses as well as her time spent with Torch Capital, a brand-focused venture fund, where she advises early-stage companies. 

Transcript

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My first minute is a fun opportunity to speak informal

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On the first minutes of their careers,

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how they see the world

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and general leadership advice.

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My name is Tommy Statham.

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I'm a help and venture partner at five minute capsule.

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And today I'm speaking to Jenny Fleiss,

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the co-founder of Rent the Runway.

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We have with us today Jenny Fleiss.

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Jenny, best known to most of you, I'm sure, is the co-founder of Rent

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the Runway, $1,000,000,000 fashion rental company.

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I think investors often like to talk about category

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defining companies and rent the runway is the ultimate category defining company.

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I think it is a category creating company.

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It pioneered online clothing rental and until very recently,

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it was the only major player in the space that completely dominates the space.

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Competitors have just somehow not been able to get close to it.

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It's interesting because it's a brand phenomenon

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which has grown to this enormous scale with almost no paid marketing

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until recently, or through viral word of mouth

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and the strength of the products, the strength of the brand.

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But it's also a logistics phenomenon.

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Not many people know that it's the largest dry cleaner in the world.

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So it takes, I think, a special pair of people to build a company like that.

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Jenny founded Rent the Runway

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with her Harvard Business School classmate Jenny Hyman.

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Jenny then went on to co-found and run Jet Black,

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which was an eight Walmart's members only concierge shopping site.

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So she's a serial entrepreneur.

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She was a financial fast best,

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very successful angel investor and very much a New Yorker.

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So, Jenny, welcome and thanks so much for joining us.

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Thank you.

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Thank you so much for the warm welcome.

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So let's go back to the beginning for you.

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The show is my first minute and it's all about people starting out

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before the runway and before even your college admissions business starts.

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And before that, before

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we went and met the 15 year old Jenny in the nineties.

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What would we see?

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What we see?

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Someone who we thought is passionate

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definitely going to be an entrepreneur because of the way she's

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raised a character of what she is, what she's up to as a kid and a teenager.

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Where did that entrepreneurial spark come from?

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I think you would have already seen that.

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You know, the first time I remember it as an eight year old running lemonade

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stands and just really feeling that that was all I wanted to do with my time.

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Like every sunny summer day, more than tennis or any other sport, an activity

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like that's how I chose to spend my time as much as my parents would let me.

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And so I think between then and then, loving to shadow my parents,

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who were both entrepreneurs in their own work environments,

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I was always kind of really intrigued by the world of entrepreneurship

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and creation, always looking for, you know, a new way to store

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my books in my book bag or to solve little problems around,

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you know, can I make a pencil holder with duct tape?

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So whatever it was a problem I was facing in a given day,

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I was always kind of oriented towards creatively thinking ways to solve that

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and contribute to create something from nothing.

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Got it.

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You also obviously very highly educated in what you know at the top schools.

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You started your career and of course, possessing and with

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Morgan Stanley, I believe it

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was. That

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always for you, a stepping stone, a training ground to sharpen your skills

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so that when you became an entrepreneur, a better entrepreneur, what did you think?

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Actually, initially

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you thought you'd have a career in corporate America or finance market.

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So as my much as when I look back on it 

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I was always kind of this serial entrepreneur.

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And actually, one of my first jobs was an internship

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and I worked at a juice bar for someone who had like

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started his own juice bar.

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And that of all the job experiences I have was one that really was memorable,

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stuck with me and had so many learning to really passionate about it.

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You know, I think we're so prone to following the course and path

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is laid out in front of us.

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So growing up in New York, the world of finance was very much around me.

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I went to a very competitive high school, so then it was about getting

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into the top school.

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I went to Yale where ironically majored in political science

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because a lot of people who are smart are doing that.

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And then when I went to the Career Services Department there,

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the only real industries recruiting were finance and consulting.

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And most people were staying in New York in terms of my friends

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and other kind of well-educated people at school with me.

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And so I kind of, you know, I fell into it and I assumed, like all the top other,

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you know, other top students were doing it and vying for these jobs.

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Then I was going to go for the kind of most competitive top job.

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And so it was kind of just following this career ladder, if you will.

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And I think it wasn't until I really took a moment to step back

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and think about, like, you know what?

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I'm not loving this and not passionate about it.

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It feels very much like work.

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I don't feel that I'm ever going to be

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the top 5% performers because I just don't love it in that way

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and gave myself kind of permission to then go to business school

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to rethink careers and learn about different industries.

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Did I stumble upon the fact that being an entrepreneur could actually be a job?

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Like I didn't even realize or put it together in that way before.

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Very interesting.

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What about before we go on to rent the runway, let's talk about the college

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admissions business, which was obviously a smaller

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your first foray into hip hop from the lemonade stand.

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What I'm curious what you learned from that experience

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and how that helped you when you went on to do it for real with Rent the Runway.

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Yeah.

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And it's funny because I had in some ways aspects of that business

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I think would actually do very well right now.

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But what happened is I you know, I had spent so much time

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on my own college application process, right.

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Applying to all these top schools, visiting them.

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And when I went and then worked in finance,

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I still had a lot of for my siblings that a lot of their friends

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organically asked me for advice and help writing college

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essays, editing college essays, thinking about which schools to apply to.

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And so I started doing it ad hoc.

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And then when I got, you know,

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kind of third and fourth degrees, I started charging for it myself.

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And it was a bit of like my side hustle while I was working in finance.

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And I did find that kind of entrepreneurial energy from it in a way

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that my day job or often night job in finance wasn't really getting me right.

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So I kind of always had it as, as a side hustle.

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And what I started to do in my real life kind of opinion

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that I started to form in doing this was that if you were able to pair up

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someone applying to school and their top school choice

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with someone who had went to that school as the tutor or advisor,

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you would have a much more organic fit and a great chance for the applicant

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to learn about the school authentically and to kind of orient their application

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to a way that was likely to kind of get them into that school.

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So that's what I started then trying to do once kind of I hit my marks and I'm, I'm

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like full time job in finance and the couple of people I was advising,

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I started to pull in other peers of mine who had gone to top schools

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and to try to pair them with other people who are like,

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I want to go to Dartmouth, I want to go to Harvard

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and to try to get their applications kind of aligned there.

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So it was again form of personalization in a way to just get people more into

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to the right to there.

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When I went to Harvard Business School, I started thinking about like what kind

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of technical platform could I leverage to accelerate and grow this business?

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And so I spent some time in kind of a field study program working a bit on that.

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And ultimately there was someone who was an undergrad at the time

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and was a tutor

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and became really passionate, and I wound up kind of selling my equity stake,

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so to speak, when I kind of moved on to work on Rent the Runway.

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So you

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go to college, you go to you go to Wall Street, build

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this class business, and then you end up a Harvard Business School

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with your eventual co-founder. Yes.

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Other Jennifer Jen Hyman.

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And, you know, in some ways, this is the classic

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it's a version of the American dream.

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Get good corporate job, go out of business, school, have a good idea.

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And it works out.

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Except in your case, it works out unbelievably well.

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I'm really curious to take you back tonight here.

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It's with which an HBO

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were you natural co-founders is always going to be the two of you

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coming up with this business together like why were you guys such a good fit?

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And how did that happen?

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Yeah.

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And well, thank you for your kind words around my success in my journey.

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I think it's it's very easy for it to look like

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all kind of glitter and unicorns from the outside.

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And you know what?

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I'm always reminding entrepreneurs, because I think there's such kind of

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a sexy, glamorized view

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of entrepreneurship these days is like there's a lot more highs

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and lows and grit and hustle and uncertainty in that story.

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And so, you know, I think when Jen and I met, it was actually the first day at all.

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And ironically, she came up to me with my name written on a Post-it note

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because her sister

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told her to look out for me and we happened to be

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in the same sections of a thousand people in your business school class.

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You know, you split up into about ten different sections.

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And so we were in the same group of of 90 to 100 people.

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We had the same name.

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And so obviously we kind of got to know each other fairly quickly.

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And for the first year it was much more just as classmates and peers and

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and we were friendly as well.

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And we started to see how we each interacted around the case study method,

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which is you dig into a business

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or a business topic and you kind of deep dove on an aspect of it.

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And the class is expected

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to kind of teach, teach the class essentially through the students.

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So the teacher is facilitating that.

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You really get a chance to hear how different peers think

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about a business problem.

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And so it was this unique chance to say, I really respect this person.

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I think they're right.

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They have often a different point of view than mine,

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but one where we were often, you know, challenging each other

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and I think develop respect for the kinds of different

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backgrounds and perspectives that we each brought to the table.

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Jen had a sales and marketing background

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and I had kind of finance consulting background.

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It was a nice complement.

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And then that kind of relationship

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naturally transitioned to talking and thinking about careers.

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And so during our second year

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when we were having kind of one of our lunch conversations around

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career steps and the jobs we were planning to accept and those paths.

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And Jen

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was kind of telling me a more funny story just about her younger sister, Becky.

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And while she was home over Thanksgiving break with Becky and Becky

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and bought a $2,000, in our case, a address very fancy designer.

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And it was a gorgeous dress.

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But as an older sister, Jen had said to her, like, this is nuts.

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Like you're in credit card debt,

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you're eating pizza for dinner because you can't afford to have normal meals.

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And she was recently Becky was recently out of college, so she was kind of

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at this lowest income earning potential in her in her career, in her life,

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but yet had a lot of social events that she was going to.

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And so she had said no.

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Older sister Jen, like all the dresses that I have in my closet, of which

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there were many, are dead to me because they were posted in social media

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and she felt like she couldn't possibly repeat them,

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which was funny but also true at the moment.

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You know, I think social media has kind of gone

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even further through the roof, but it was really taking office.

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I didn't post a photo after an event.

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You would solidify a memory and get more and more kind of compliments.

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And so it was a form of even experiential marketing

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and then this need to constantly brand new items.

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And the other thing Becky said was, I might meet my future husband

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at this wedding that I'm going to wear the dress to

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because you're in these kind of this moment in your twenties

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where you are going to a lot of events and it's high stakes life you might meet.

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You want to put your best self out

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that you're building your own kind of personal brand

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and social media, kind of handmade it, this indelible brand that you're building.

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And so there was kind of a rationale and this kind of disconnect in the market.

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And when we started thinking

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about the designer industry and what had happened in that

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that moment to respond to the result of fast fashion brands Zara, H&M, Forever 21,

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that we're coming in to try to address that gap

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and that that consumer frustration and problem.

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But designers were left kind of scrambling and were really open

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minded in a different way, though it was a small open mindedness

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that took a while to trying out a concept like runs the runway.

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And so that's how it began.

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And the initial vision

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rent the runway, you know, obviously it's ended up being a huge, huge business.

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Did you not to build a business which would dominate the sector

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and be very large, or was this more an organic thing

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that, you know, you thought it was grounded? Let's build and it's.

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So I think, you know, Jen would say and this is part of why

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I think we're like great we made great co-founders

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that she was always going after this huge vision

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of democratizing, luxury, changing industry.

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I, you know, my skill side is like, how do you get from point A to point B?

00:13:13:21 - 00:13:17:22
So to break down a big, ambitious vision, you know,

00:13:17:25 - 00:13:19:11
we definitely didn't know

00:13:19:11 - 00:13:23:03
exactly where it would be kind of the ten years later where we are right now.

00:13:23:22 - 00:13:26:29
So even though we had visions for how could we do 100 million in revenue,

00:13:27:21 - 00:13:28:29
how could we grow the dress

00:13:28:29 - 00:13:31:03
rental portion of the business, which is where we started?

00:13:31:15 - 00:13:35:10
I don't think we could have even imagined how much that business would have evolved

00:13:35:10 - 00:13:38:15
and how much our customer base evolved and certain things we would do around

00:13:39:02 - 00:13:42:21
drop boxes to return your rental or the subscription business

00:13:42:21 - 00:13:46:01
where now you kind of have rotating apparel of every different kind.

00:13:46:01 - 00:13:49:01
And I very much was thinking about like one foot in front of the next,

00:13:49:01 - 00:13:51:15
like drinking from a fire hose of what do we need to do tomorrow?

00:13:51:15 - 00:13:54:14
What do we need to do next week to to just keep going?

00:13:54:16 - 00:13:56:05
So I was like just one foot in front of an ax,

00:13:56:05 - 00:13:59:13
like chasing demand for what felt like the first four years

00:13:59:13 - 00:14:02:03
at least before we could then kind of get our words together and say like,

00:14:02:17 - 00:14:05:26
okay, like infrastructure, stable enough.

00:14:05:26 - 00:14:08:01
Where do we want to go in the future?

00:14:09:02 - 00:14:09:18
Tell us about the

00:14:09:18 - 00:14:12:24
first ten dresses like what actually was happening behind the scenes.

00:14:12:25 - 00:14:14:21
I imagine you were fighting until you made it.

00:14:14:21 - 00:14:15:05
What?

00:14:15:05 - 00:14:18:10
Yeah, well, the first ten dresses were borrowed from friends and bought

00:14:18:10 - 00:14:21:24
with our own kind of money, and we bought them in our own sizes.

00:14:21:24 - 00:14:25:25
So, like, worst case, we would have great dresses in our wardrobe.

00:14:26:17 - 00:14:29:00
We, we did a trial, a test.

00:14:29:00 - 00:14:32:18
So we were at Harvard Business School, still having no venture money

00:14:32:18 - 00:14:37:07
raised at that point and trying to learn like will customers rent dresses.

00:14:37:07 - 00:14:39:20
And there were so many questions like, is there a stigma around it?

00:14:39:20 - 00:14:40:25
How much will they pay?

00:14:40:25 - 00:14:43:19
What designs and styles will they want to rent?

00:14:43:29 - 00:14:47:07
And and so we we bought dresses.

00:14:47:07 - 00:14:50:04
We borrowed dresses and we set up shop at Harvard undergrad across the way

00:14:50:04 - 00:14:53:03
because all these students were having graduation events at the time.

00:14:53:03 - 00:14:54:22
So a lot of reasons to rent dresses.

00:14:55:21 - 00:14:56:04
And, you know,

00:14:56:04 - 00:14:59:22
the first thing that happened is a girl walked in, she picked out the most kind

00:14:59:22 - 00:15:03:26
of flamboyant dress, gold sequined dress, twirled around in the mirror.

00:15:03:26 - 00:15:05:20
And she said, I look hot.

00:15:05:20 - 00:15:07:25
And her whole persona was transformed. Right.

00:15:07:25 - 00:15:10:16
She had like an extra bounce in her staff, an extra set of confidence.

00:15:10:16 - 00:15:12:28
She didn't want to take the dress off for like the full hour.

00:15:12:28 - 00:15:15:01
She was strutting her stuff in front of her friends.

00:15:15:27 - 00:15:17:19
And we're like, That's our business, right?

00:15:17:19 - 00:15:19:10
It's about that that confidence.

00:15:19:10 - 00:15:23:11
Like the why of like, why does designer fashion matter?

00:15:23:11 - 00:15:24:06
Why is luxury matter?

00:15:24:06 - 00:15:27:10
It is about the feeling that like, hey, I can take on this day,

00:15:27:10 - 00:15:30:19
I can take on that date night or that event or that power

00:15:30:19 - 00:15:34:14
meeting at work, whatever it is, and feel just great about it.

00:15:34:14 - 00:15:38:28
And so we we decided we want to build a business around that feeling.

00:15:38:28 - 00:15:42:17
And so more of a service company, if you will, that was around

00:15:42:17 - 00:15:47:10
this aspirational, this access to aspirational, empowering feeling.

00:15:47:23 - 00:15:49:10
So those are our first ten dresses.

00:15:49:10 - 00:15:52:02
It was kind of this very scrappy approach.

00:15:52:20 - 00:15:54:13
From those first ten dresses.

00:15:54:13 - 00:15:57:24
When did it then feel like you'd hit some kind of velocity?

00:15:57:24 - 00:15:59:02
Something it changed.

00:15:59:02 - 00:16:01:15
And it it it it's not it's a really take off.

00:16:01:20 - 00:16:05:03
And how did you get to that point? Yeah.

00:16:05:03 - 00:16:06:00
So, you know,

00:16:06:00 - 00:16:09:23
I think there's a couple of moments like getting a venture capital term sheet.

00:16:09:23 - 00:16:12:06
I think for me coming from the world of finance

00:16:12:06 - 00:16:15:19
and also feeling like as first time entrepreneurs having

00:16:16:06 - 00:16:19:19
raised from Bain Capital Ventures, so having like a credible team

00:16:19:27 - 00:16:22:09
connected to us, having real funding behind us,

00:16:22:09 - 00:16:26:02
that meant we could buy a sizable amount of inventory right

00:16:26:02 - 00:16:28:09
then starting to write the checks for those inventory.

00:16:29:11 - 00:16:32:06
That was definitely one moment, right, of like, hey, we have the capital

00:16:32:06 - 00:16:37:15
signing the resources, the partnership with a top tier fund to be real.

00:16:37:15 - 00:16:40:08
And so we had other jobs and and I'd had other jobs lined up.

00:16:40:08 - 00:16:42:29
We at that point, kind of those of their jobs were like this is going to be real.

00:16:42:29 - 00:16:44:06
So that was one moment.

00:16:44:06 - 00:16:48:18
And I think the next was definitely once we launched the site and, you know,

00:16:48:28 - 00:16:52:27
day one, even when we were kind of quasi stealth mode, there's like the wait list

00:16:52:27 - 00:16:56:05
because we were acquiring names for that first week before we formally launched

00:16:56:21 - 00:17:00:21
was growing and growing and the appetite was really, really exciting.

00:17:00:21 - 00:17:04:23
And then of course, at launch, like just the amount of orders that were flooding in

00:17:05:09 - 00:17:07:05
and then lots of little moments along the way,

00:17:07:05 - 00:17:09:06
you know, people reaching out to us, wanting

00:17:09:06 - 00:17:13:09
to open, to intern for us for like cheap or nothing.

00:17:13:09 - 00:17:13:21
Right?

00:17:13:21 - 00:17:16:27
Because they were so passionate and believe in what we were doing

00:17:16:27 - 00:17:20:05
and believed in Jan and I and our vision and the need for this service

00:17:20:27 - 00:17:23:28
and just the commitment and dedication that that whole early team brought to

00:17:23:28 - 00:17:28:03
the company, I think started to kind of give us more and more reaffirmation.

00:17:29:25 - 00:17:32:17
It's really interesting you talk about that and the buzz at the launch.

00:17:32:17 - 00:17:34:05
And for me, when I think about Rent the Runway,

00:17:34:05 - 00:17:38:25
the single biggest thing that jumps out is the strength of the brand

00:17:38:25 - 00:17:42:26
and the very unusual fact that you rarely in the marketing

00:17:42:26 - 00:17:46:05
until very recently had very little paid marketing and so unusual to

00:17:47:10 - 00:17:50:00
have so many and so many startups, particularly consumer startups

00:17:50:08 - 00:17:52:17
who are addicted to paid marketing from the beginning,

00:17:52:17 - 00:17:54:08
very high customer acquisition costs.

00:17:54:08 - 00:17:55:26
You just have already faced that as a business

00:17:55:26 - 00:17:58:19
because of the strength of the brand, also the products.

00:17:58:19 - 00:18:03:07
So, you know, one of my big heroes, Edwin Land, the inventor of Polaroid cameras

00:18:03:15 - 00:18:06:14
and his big thing, which was

00:18:06:14 - 00:18:10:10
Steve Jobs, was the marketing is what you do when your product is no good.

00:18:10:10 - 00:18:13:18
And it seems like the ultimate example of that where you just didn't have I.

00:18:13:20 - 00:18:14:24
Like that.

00:18:14:24 - 00:18:18:01
Was like was it more about the was it about the product

00:18:18:01 - 00:18:19:01
just being so good

00:18:19:01 - 00:18:22:18
it not existing anywhere else that it just got women talking about it all?

00:18:22:18 - 00:18:24:29
Was it also this really well thought out brand?

00:18:24:29 - 00:18:29:09
How much of it was product and how much of it was brand?

00:18:29:09 - 00:18:32:10
It's hard to separate the two.

00:18:32:10 - 00:18:34:14
You know, I think timing was a piece of it, right?

00:18:34:14 - 00:18:39:17
Like I think we had a moment in time where we saw other industries

00:18:39:17 - 00:18:43:26
like the car rental business, where at the time you had Zipcar, right?

00:18:43:26 - 00:18:47:24
Or the movie rental business where Netflix.

00:18:47:24 - 00:18:48:03
Right.

00:18:48:03 - 00:18:51:06
So like we saw other industries that were being transformed in this like

00:18:51:07 - 00:18:55:20
sharing economy told us that there was more open

00:18:55:20 - 00:18:58:28
mindedness from consumers to accept and embrace this change.

00:18:59:11 - 00:19:03:15
I think the other thing that happened is because of this realization

00:19:03:15 - 00:19:06:18
around the feeling that aspirational, empowered feeling

00:19:06:26 - 00:19:09:21
that we wanted to rent to consumers, that being our business,

00:19:10:10 - 00:19:11:16
we're very thoughtful

00:19:11:16 - 00:19:14:24
and intentional around all aspects of our brand, our marketing,

00:19:15:14 - 00:19:18:17
realizing that whatever we put out there had to feel

00:19:18:27 - 00:19:22:00
magical, aspirational, luxury designer, right?

00:19:22:00 - 00:19:24:11
If we wanted you to get that empowered feeling.

00:19:24:21 - 00:19:26:20
So we were really thoughtful about that.

00:19:26:20 - 00:19:29:21
It also mattered a lot for our designer partners because

00:19:29:21 - 00:19:33:07
at this moment when we launched, we launched in November 2009,

00:19:33:07 - 00:19:37:17
many of these brands that were we work with were very nervous about rental.

00:19:37:17 - 00:19:39:25
They were also nervous about putting their product online.

00:19:40:04 - 00:19:42:23
And then when they do put them online, like it's harder.

00:19:42:23 - 00:19:44:27
They felt it was harder to control than a retail store.

00:19:44:28 - 00:19:47:25
Like what products are you alongside? And that's to right?

00:19:47:25 - 00:19:52:05
Like how can they control this equity they felt was really important.

00:19:52:05 - 00:19:55:29
So by virtue of having to service and get those brands comfortable,

00:19:56:04 - 00:20:00:01
we also had to build a very aspirational, thoughtful brand.

00:20:01:03 - 00:20:03:03
What we did know

00:20:03:03 - 00:20:07:13
is that the natural conversation starter between women at almost any

00:20:07:13 - 00:20:11:07
event a day in the office or a wedding, a party is you look great.

00:20:11:07 - 00:20:13:23
Like what are you wearing and complementing it?

00:20:13:23 - 00:20:19:12
It's a great kind of social lubricant and we said like, can we own that moment?

00:20:19:12 - 00:20:19:24
Right?

00:20:19:24 - 00:20:23:27
Because that would be the most powerful thing, the cheapest form of marketing,

00:20:23:27 - 00:20:25:09
the most authentic thing.

00:20:25:09 - 00:20:29:27
And given that rental is such a new behavior or was such a new behavior,

00:20:30:05 - 00:20:32:15
we knew customers would have a lot of questions around

00:20:32:21 - 00:20:36:07
what if I still a glass of wine or do I put it in the mailbox?

00:20:36:07 - 00:20:38:08
How do I return it? Does it come on time?

00:20:38:08 - 00:20:39:21
What if it doesn't fit?

00:20:39:21 - 00:20:42:25
We're like, how could we ever answer that in an initial marketing?

00:20:43:14 - 00:20:46:26
And I think today it's a much more commonplace practice that we do

00:20:46:26 - 00:20:47:29
use marketing ads more.

00:20:47:29 - 00:20:51:11
But initially we're like, we need to be able to enter a conversation

00:20:51:19 - 00:20:55:09
so that a person who's tried it can actually respond to all this question.

00:20:55:10 - 00:20:58:05
So that's kind of what made intuitive sense to us.

00:20:59:00 - 00:21:01:09
And we went so far as to, you know,

00:21:01:21 - 00:21:06:02
I remember we pulled the initial kind of branding work that we were like a month

00:21:06:02 - 00:21:10:01
from going live with because I was like, This is not the aspirational it was.

00:21:10:01 - 00:21:13:10
I called a kind of Roxy, quicksilver looking pinks and oranges.

00:21:13:10 - 00:21:16:04
And it was like and some of that was a gut feel.

00:21:16:13 - 00:21:20:05
I often really do think that the best businesses are made when the consumer

00:21:20:29 - 00:21:22:02
is the founder, right?

00:21:22:02 - 00:21:24:18
So like Jen and I starting the business, we were women in our twenties

00:21:24:18 - 00:21:27:25
when we evolved the business to subscription and more types

00:21:27:25 - 00:21:30:16
of apparel, we were in our thirties because we needed that.

00:21:30:25 - 00:21:34:06
So I think we were very able to relate to what felt aspirational to us

00:21:34:06 - 00:21:38:02
as consumers, but felt like something we would want to talk about to consumers.

00:21:38:19 - 00:21:42:24
I think the other thing we we tapped into from a psychological moment in time was

00:21:43:17 - 00:21:46:22
because I think of the recession and businesses like Gilt Group,

00:21:47:02 - 00:21:51:17
it was starting to become cool to save money and be smart about shopping.

00:21:52:09 - 00:21:54:29
So suddenly something like Gilt Group, which like discount online

00:21:54:29 - 00:21:59:09
shopping and sample sales, was weightless and premium and luxury,

00:21:59:17 - 00:22:01:00
which was never the case before.

00:22:01:00 - 00:22:01:19
Like growing up,

00:22:01:19 - 00:22:04:23
if I shopped at Loehmann's and TJ Max, like you didn't talk about it,

00:22:04:23 - 00:22:07:28
we're kind of embarrassed going into or out of the store today.

00:22:07:28 - 00:22:12:08
It's like second hand is vintage and getting something on set, you know?

00:22:12:09 - 00:22:14:17
It's like, who pays retail? Like, that's uncool.

00:22:14:17 - 00:22:17:09
So we're like, okay, there's a moment of time that we can actually tap in.

00:22:17:09 - 00:22:19:25
And farmers part is here for what a smart consumer

00:22:19:25 - 00:22:23:22
is that will make them more likely to want to shout from the rooftops.

00:22:23:22 - 00:22:27:17
The fact that they rented or at least kind of share their with their close group

00:22:27:17 - 00:22:28:02
of friends.

00:22:29:09 - 00:22:29:24
Interesting.

00:22:29:24 - 00:22:31:26
Well, I definitely want to come on in a bit and talk about

00:22:32:09 - 00:22:34:29
founding a business in a recession and building it from there.

00:22:35:01 - 00:22:38:07
Yes, the other groups around that like Gilt Group

00:22:38:07 - 00:22:41:18
and Cabinet, Kevin Ryan was on the series earlier on in the month.

00:22:41:18 - 00:22:43:20
I think so. Add some fascinating things to say.

00:22:43:20 - 00:22:46:22
Oh, great. That time as well.

00:22:46:22 - 00:22:48:27
So what just briefly then before we move on to that

00:22:48:27 - 00:22:52:10
pivot to subscription, what about PR and media?

00:22:52:10 - 00:22:55:07
How important was that, your mastery of that to again,

00:22:55:07 - 00:22:57:16
just to avoid paid marketing and to build a buzz?

00:22:57:16 - 00:22:59:04
Well, you.

00:22:59:22 - 00:23:04:02
Very important and I'm glad you brought it up, because I meant to also mention it.

00:23:04:03 - 00:23:07:25
We realized that another way to have that conversation that like

00:23:07:26 - 00:23:11:00
longer marketing would be through PR, right?

00:23:11:00 - 00:23:11:18
So you can

00:23:12:19 - 00:23:14:02
do it intentionally at PR or

00:23:14:02 - 00:23:17:08
you can build that brand and kind of try to insert yourself into these organic,

00:23:17:08 - 00:23:19:19
authentic conversations. And we and we did both things.

00:23:20:00 - 00:23:23:03
I mean, I think what really hit hard with us,

00:23:23:18 - 00:23:25:13
we always thought, you know, PR will be really important.

00:23:25:13 - 00:23:29:01
We leaned into it as much as we could, but we were featured in the front page

00:23:29:01 - 00:23:32:25
of the technology section of the New York Times on our launch day.

00:23:33:21 - 00:23:38:03
And that happened because I think a founder

00:23:38:03 - 00:23:40:08
is like obsesses over customer lists.

00:23:40:08 - 00:23:43:11
We were looking through a customer email list from our wait list and realized

00:23:43:11 - 00:23:46:01
that someone was from the New York Times on that list.

00:23:46:21 - 00:23:49:09
And so, you know, reached out to kind of say,

00:23:49:09 - 00:23:53:06
hey, let's share more about the business and wound up convincing them.

00:23:53:06 - 00:23:54:13
I do want to include some photos.

00:23:54:13 - 00:23:57:02
We're happy to have you into our warehouse as a dry cleaner.

00:23:57:02 - 00:24:01:01
And, you know, we had these pictures of us wearing kind of outlandish dresses

00:24:01:01 - 00:24:05:04
on top of ladders inside of a dry cleaner, which for the technology writer

00:24:05:04 - 00:24:08:14
in the technology section, who, you know, that technology writer at the time

00:24:08:14 - 00:24:11:18
was also kind of just making her way like as a young woman in her twenties.

00:24:11:19 - 00:24:14:20
Like one of those breakout stories was a really great bed.

00:24:14:20 - 00:24:17:05
And that that was another moment having that article

00:24:17:05 - 00:24:20:24
that I think really saw the direct impact we felt that had to our sales

00:24:20:24 - 00:24:22:08
and the kind of awareness

00:24:22:08 - 00:24:24:27
and the excitement in the investor community around what we were doing.

00:24:24:27 - 00:24:28:17
And from that moment we leaned in to press in a really big way.

00:24:29:07 - 00:24:32:14
As an angel investor, do you recommend your portfolio company

00:24:32:14 - 00:24:35:25
founders to hire agencies?

00:24:35:27 - 00:24:38:02
You they should just get on with it and build relationships

00:24:38:02 - 00:24:39:16
with journalists themselves directly.

00:24:41:06 - 00:24:42:25
Ideally both, right.

00:24:42:25 - 00:24:46:13
And so I think it's always about resources, right?

00:24:46:13 - 00:24:49:27
I think if you have enough resources, I believe that PR agencies

00:24:49:27 - 00:24:53:26
are a good investment kind of bang for your buck marketing wise.

00:24:54:19 - 00:24:58:13
I advise them to always speak to quite a few because like worst case,

00:24:58:13 - 00:24:59:27
you build the relationship for future

00:24:59:27 - 00:25:02:10
or you get a lot of good ideas from the ones you don't pick.

00:25:02:29 - 00:25:08:06
I do think you need to have any agency or B-to-B software that you

00:25:08:17 - 00:25:11:16
you buy whatever it is, is only as good as the people you have managing it.

00:25:11:17 - 00:25:11:24
Right.

00:25:11:24 - 00:25:14:05
So I think if you don't have someone in-house

00:25:14:05 - 00:25:17:29
who either has some of that background or responsibility

00:25:17:29 - 00:25:21:03
and is constantly kind of like hounding and checking in on the agency,

00:25:21:24 - 00:25:23:13
I don't think you get as much out of it.

00:25:23:13 - 00:25:26:19
And I think it's about the kind of follow up, the follow through mix

00:25:26:19 - 00:25:29:20
in the internal with anything you have external

00:25:30:08 - 00:25:34:06
but with early stage lean teams, I think it's very rare to have be able

00:25:34:06 - 00:25:36:26
to have like your own dedicated PR so I think it's,

00:25:36:26 - 00:25:39:06
it is a healthy kind of complement to have an agency.

00:25:39:28 - 00:25:43:16
Yeah, I would agree and it's often I think something PR is something

00:25:43:16 - 00:25:46:29
that early stage technology companies particularly think of as an afterthought.

00:25:46:29 - 00:25:49:04
And it doesn't come naturally to a lot of tech families.

00:25:49:04 - 00:25:52:01
So definitely something that people can gain if they.

00:25:52:14 - 00:25:56:01
Yeah, I think it's really powerful and you know, I think there's that

00:25:56:01 - 00:25:58:28
after the New York Times article, I think also very quickly showed us that like,

00:25:59:07 - 00:26:02:28
you know, there's two types of press, probably even there's far more than that.

00:26:02:28 - 00:26:06:00
But there's at least the element of like, what is your product, right?

00:26:06:00 - 00:26:09:16
And the like kind of consumer facing like, hey, this is the runway.

00:26:09:24 - 00:26:13:06
And then there's also the business element of like two female founders

00:26:13:06 - 00:26:16:18
right out of business school, no fashion background, no tech background.

00:26:17:07 - 00:26:20:07
And I think both the moment in time we were in where entrepreneurship,

00:26:20:07 - 00:26:23:15
especially in New York, was just exploding, where there was a real drive

00:26:23:15 - 00:26:28:05
to get more female entrepreneurs in place where there hadn't

00:26:28:05 - 00:26:32:11
been a ton of fashion and female oriented startups prior to that.

00:26:32:24 - 00:26:35:08
That was a really exciting, resonating story to us.

00:26:35:09 - 00:26:37:04
I think both had a product that was really interesting

00:26:37:04 - 00:26:39:25
and fascinating to think about, that was accessible to think about.

00:26:39:25 - 00:26:42:15
We had a story that was accessible to think about.

00:26:43:03 - 00:26:47:25
So I think we found very quickly that and I say this to other startups too,

00:26:47:25 - 00:26:50:29
like that business story, in addition to our product

00:26:50:29 - 00:26:55:04
itself, was very powerful and engaging.

00:26:55:04 - 00:26:58:08
So to take it from that glossy side of the business to that hard

00:26:58:09 - 00:27:01:04
core detail, difficult side of the business,

00:27:01:19 - 00:27:03:16
is it right when I said at the beginning that rent

00:27:03:16 - 00:27:05:21
the runway is the largest dry cleaner in the world?

00:27:06:04 - 00:27:08:19
Yes, to my knowledge, that is still the case.

00:27:08:19 - 00:27:10:23
And how did you do that? I mean, that's yeah.

00:27:12:01 - 00:27:12:24
That was wild.

00:27:12:24 - 00:27:16:08
That was a lot of my of my time in work at the business.

00:27:16:16 - 00:27:19:09
And I never would have cried however much I wouldn't have expected

00:27:19:09 - 00:27:21:10
working in fashion or technology.

00:27:21:10 - 00:27:24:19
I also wouldn't have expected for sure working in dry cleaning.

00:27:25:10 - 00:27:28:16
I mean, it started out that we we needed to get dresses cleaned.

00:27:28:23 - 00:27:32:05
So when we were initially in Boston, we went to the local dry cleaners there

00:27:32:05 - 00:27:35:13
and we tried to negotiate bulk rates for these tests that we were doing.

00:27:36:05 - 00:27:38:26
But then once we were very quickly back in New York

00:27:38:26 - 00:27:40:12
and that's where we set up the business,

00:27:40:12 - 00:27:44:14
I would go to my local dry cleaner around the corner and say, You know what?

00:27:44:14 - 00:27:48:05
You normally charge me 15, $18 for cleaning a dress.

00:27:48:13 - 00:27:49:11
What's your cost?

00:27:49:11 - 00:27:53:05
Okay, if your cost is $5, can you can we pay you six?

00:27:53:05 - 00:27:56:06
Can you pay seven, eight and figure it out, that kind of appraising?

00:27:57:00 - 00:27:58:29
And so that's how it started.

00:27:58:29 - 00:28:02:22
I noticed you had an empty rack in his dragon facility.

00:28:02:22 - 00:28:04:00
I was like, Can we keep our dresses here?

00:28:04:00 - 00:28:06:16
So pretty soon we had free storage.

00:28:06:16 - 00:28:09:16
But it also let him feel more comfortable that we were committing

00:28:09:16 - 00:28:12:19
to kind of the volume that we were going to do.

00:28:12:19 - 00:28:14:08
And then by virtue of just

00:28:14:08 - 00:28:18:04
that's what our warehouse was and I was there for half the day,

00:28:18:11 - 00:28:22:18
I started learning ton about dry cleaning naturally by being there, by needing

00:28:22:18 - 00:28:26:28
to troubleshoot and problem solve when address was stained or this or that.

00:28:28:03 - 00:28:29:12
And in part of kind

00:28:29:12 - 00:28:32:13
of like trying to learn about more effective ways

00:28:32:13 - 00:28:35:02
to clean and to kind of scale this part of our business.

00:28:35:22 - 00:28:39:22
I was able to meet the CEO of one of the like the best

00:28:39:25 - 00:28:43:17
largest dry cleaners in New York and kind of tour their facility.

00:28:44:02 - 00:28:47:12
And that was someone who I later convinced to come work for us.

00:28:47:29 - 00:28:49:01
And when I met him, I said

00:28:49:01 - 00:28:52:23
to you one day, I'm going to convince you to come work for us and hire you.

00:28:52:23 - 00:28:55:07
And at that time, it was kind of a joke because I don't think we

00:28:55:27 - 00:28:59:07
really launched our business yet, but it happened.

00:28:59:07 - 00:29:02:18
And I think in the meantime, you know, he became a mentor, an advisor of mine,

00:29:03:12 - 00:29:08:01
helped me kind of understand a lot of the inner workings of the dry cleaning world.

00:29:08:01 - 00:29:11:17
And then ultimately we hired him to set up our own facility

00:29:11:17 - 00:29:16:01
because once we grew out of one facility, it was very inconvenient

00:29:16:01 - 00:29:21:10
to have five different places where we were sending all of our inventory to.

00:29:21:26 - 00:29:25:07
We needed to turn them around that same day to get them out

00:29:25:07 - 00:29:27:09
to the next customer, because that's where all of our cash

00:29:27:09 - 00:29:29:13
and capital was tied up in the inventory spend.

00:29:29:22 - 00:29:32:12
So the turnaround was really quick and so we very quickly realized

00:29:32:15 - 00:29:34:27
we needed to have dry cleaning co-located.

00:29:35:25 - 00:29:39:14
And I think where we've taken that part of the business, we now evolved

00:29:39:14 - 00:29:43:14
so much IP around different cleaning methods that are less,

00:29:43:20 - 00:29:46:12
that are faster, that require less wear and tear on the dresses

00:29:46:12 - 00:29:48:23
that are more sustainable, have less chemicals,

00:29:49:16 - 00:29:52:11
and what fabrics work in the cleaning processes?

00:29:52:11 - 00:29:56:14
We have a whole training program for certain dry cleaning functions.

00:29:56:14 - 00:29:58:27
That skill set is just fairly rare or difficult.

00:29:59:04 - 00:30:02:04
We have a whole repair team, seamstress team, where we do things

00:30:02:04 - 00:30:06:19
like tape floor length dresses and we cut them into short dresses.

00:30:06:26 - 00:30:11:12
Once enough of them become kind of deteriorated on the bottoms.

00:30:11:12 - 00:30:14:07
So I think we've really just driven a whole level of innovation.

00:30:14:08 - 00:30:17:07
It's it's a dry cleaning plus plus sort of facility. Now.

00:30:18:16 - 00:30:21:21
It's an extraordinary business with the brand and the logistics guy.

00:30:21:22 - 00:30:22:25
At the same time,

00:30:22:25 - 00:30:25:01
we're going to come in in about 10 minutes inside some questions

00:30:25:01 - 00:30:27:22
with some serious big cases from all of fashion on the line.

00:30:27:22 - 00:30:28:23
We've got

00:30:29:16 - 00:30:32:19
wonderful full Carmen Baskets on a masonite from Net-A-Porter fame.

00:30:33:17 - 00:30:36:26
We have got, I think, Janet Cronje there as well.

00:30:36:26 - 00:30:40:06
So some really interesting people will come to people to questions in a moment.

00:30:40:17 - 00:30:44:07
But let's just finish off the rent the runway, Johnny, before we do that,

00:30:45:04 - 00:30:47:12
you mentioned earlier that pivot, pivot

00:30:47:22 - 00:30:49:29
evolution into subscription,

00:30:51:00 - 00:30:55:15
which I imagine was really important from a financing point of view.

00:30:55:15 - 00:30:57:12
And eventually, as you think about IPO

00:30:57:12 - 00:31:01:15
or some kind of liquidity event, was that scary to think, right?

00:31:01:15 - 00:31:03:27
We're going to have to rebuild the business almost from scratch.

00:31:04:10 - 00:31:07:21
The concepts going to change, maybe the price point demographic might change.

00:31:07:26 - 00:31:09:04
Was that a scary thing to do?

00:31:10:06 - 00:31:11:17
It was very scary.

00:31:11:17 - 00:31:15:07
I think we we had learned some hard lessons, though,

00:31:15:07 - 00:31:19:18
early on around being really careful with inventory selection.

00:31:20:06 - 00:31:22:17
And so I think we were we were very thoughtful.

00:31:22:17 - 00:31:26:04
We took our time in approaching it and did a lot of testing

00:31:27:00 - 00:31:31:19
just the way an early stage startup does before we kind of launched into it.

00:31:31:19 - 00:31:36:26
So as much as it was scary, it was very well calculated risk that we were

00:31:37:15 - 00:31:41:10
we felt we could be patient with because we knew how hard

00:31:41:10 - 00:31:42:24
the nuts and bolts of our business was.

00:31:42:24 - 00:31:46:11
So this whole time, you know, we don't have many competitors and it's

00:31:46:11 - 00:31:49:13
because it's a really hard business running at a very high business scale.

00:31:49:22 - 00:31:53:22
So it let us, I think, have that freedom and latitude to start things and to grow

00:31:53:22 - 00:31:55:26
in a smart way, to grow in a thoughtful way,

00:31:55:26 - 00:31:59:06
to approach every business evolution in a way that really like test

00:31:59:06 - 00:32:00:05
learns iterated.

00:32:00:05 - 00:32:03:16
So with, you know, with subscription, you know, I think it largely

00:32:03:16 - 00:32:04:09
somewhat started out of

00:32:04:09 - 00:32:08:21
just the serial entrepreneur minds that I have where I, you know, after

00:32:08:26 - 00:32:12:11
leaving logistics for the business, I then went to lead business development,

00:32:12:25 - 00:32:14:24
which was kind of like, where are we going next? Right?

00:32:14:24 - 00:32:18:19
And so we launched retail out of that business and we did that through a test

00:32:18:19 - 00:32:22:24
and learn situation where we had physical stores inside of our office.

00:32:22:24 - 00:32:23:02
Right.

00:32:23:02 - 00:32:25:23
And then eventually started testing out what formats could work.

00:32:26:00 - 00:32:28:03
Do we partner with department stores?

00:32:28:03 - 00:32:32:20
Do we have our own standalone eventually drop boxes and merge from that line too?

00:32:32:20 - 00:32:33:29
And then subscription?

00:32:33:29 - 00:32:39:11
And I think this kind of curiosity of how could we take some of our super users

00:32:39:12 - 00:32:43:06
were starting to use those like 20 times a year and how could we grow?

00:32:43:12 - 00:32:45:23
We saw how profitable that behavior was.

00:32:45:23 - 00:32:48:25
And once you convinced someone to try rental, that's kind of the hardest thing.

00:32:48:25 - 00:32:51:19
And then they become hooked. Like, what else could we do with that?

00:32:51:19 - 00:32:56:16
Core consumer base was was very was a smart way

00:32:56:16 - 00:33:00:25
to grow from the kind of cost of customer acquisition perspective.

00:33:01:05 - 00:33:04:15
But it was also really interesting from the backend logistics perspective

00:33:04:15 - 00:33:08:08
because initially we had people renting dresses for weekend.

00:33:08:08 - 00:33:08:25
That's right.

00:33:08:25 - 00:33:11:27
Most people have events on the weekends and so someone

00:33:11:27 - 00:33:15:12
would rent a dress to arrive on a Friday, Thursday or Friday.

00:33:15:12 - 00:33:19:07
They put it back in the mailbox on Monday because there's mail on Sunday.

00:33:19:13 - 00:33:21:28
We get it back Tuesday or Wednesday.

00:33:21:28 - 00:33:25:08
We had to turn around and cleaned basically all of our inventory Tuesday

00:33:25:08 - 00:33:28:24
and Wednesday to get it out the door again on Thursday for Friday delivery.

00:33:29:00 - 00:33:32:19
So it starts to put a real strain on just kind of that labor peak

00:33:32:20 - 00:33:37:08
utilization and machinery utilization rate of all your dry cleaning equipment,

00:33:37:16 - 00:33:40:24
which isn't great from kind of the back end economics of the business.

00:33:41:00 - 00:33:44:18
So we needed to find ways also to just like smooth out on the back

00:33:44:18 - 00:33:48:12
end some of that inventory lumpiness and kind of the operational lumpiness

00:33:48:12 - 00:33:48:25
of the business.

00:33:48:25 - 00:33:52:29
So subscription losses satisfied that we tested everything

00:33:52:29 - 00:33:57:03
from a jewelry accessories subscription, which felt

00:33:57:03 - 00:34:01:02
a lot cheaper to ship to and from no sizing issues.

00:34:01:02 - 00:34:02:26
The margins were really good

00:34:02:26 - 00:34:05:11
and then started just testing different types of inventory.

00:34:05:11 - 00:34:08:23
And so it took us to a couple of years before we really felt confident enough

00:34:09:14 - 00:34:12:00
that we had the right inventory mix, the right pricing

00:34:12:00 - 00:34:16:05
to turn the switch on for what subscription would look like.

00:34:16:05 - 00:34:18:00
You know, one other thing we did in that time

00:34:18:00 - 00:34:21:01
period was we did a lot of pricing testing with our core business.

00:34:21:11 - 00:34:24:02
So we said, okay, current customers,

00:34:25:08 - 00:34:27:07
those who haven't rented, why haven't you rented?

00:34:27:07 - 00:34:30:27
One of the biggest things was they felt they didn't have an event

00:34:31:07 - 00:34:34:28
and we're like, Well, have you had any birthdays, baby

00:34:34:28 - 00:34:37:13
showers, interviews, like any of these that have

00:34:37:13 - 00:34:39:09
you had a date with your significant other?

00:34:39:09 - 00:34:41:28
And they were like, Oh yeah. And they were like, okay, well, why not rent for that?

00:34:41:28 - 00:34:43:09
And what it came down to was price.

00:34:43:09 - 00:34:48:04
Well, it wasn't an event that was worth paying $100 for an outfit just for that

00:34:48:12 - 00:34:52:17
or the thought process, you know, maybe was was too complicated to merit that.

00:34:52:24 - 00:34:54:24
And so we're like, well, what if it was $40?

00:34:54:24 - 00:34:56:11
What if it was $50?

00:34:56:11 - 00:34:58:25
And so we started to realize that if we played with some pricing,

00:34:58:25 - 00:35:02:12
then you could get a larger share of events that people felt open

00:35:02:12 - 00:35:06:22
to putting the effort and the cost into a rental for it.

00:35:06:22 - 00:35:10:04
So that was also a great kind of helpful consumer mentality

00:35:10:04 - 00:35:13:20
gateway that gave us the confidence to push into subscription.

00:35:13:20 - 00:35:17:18
And I think it's you know, I will say it has grown

00:35:17:18 - 00:35:20:24
and taken over to an extent that we could have never imagined.

00:35:20:24 - 00:35:24:25
Just the way it plays into people's lives, the community that's formed around it,

00:35:24:25 - 00:35:28:18
the conversations that people have aside, the slack

00:35:28:18 - 00:35:31:26
channels that people have at work around, like what are you wearing and renting?

00:35:31:26 - 00:35:34:09
And you know, can you try to meet at this hour

00:35:34:09 - 00:35:36:21
to try it on in the bathroom so we can see what you think?

00:35:37:12 - 00:35:41:20
I think is just been so authentic and amplified what we want to be

00:35:41:28 - 00:35:45:23
as a brand to our our community.

00:35:45:23 - 00:35:47:07
And the last one to rent the runway.

00:35:47:07 - 00:35:50:00
Then picking up on what you just said, what's the future?

00:35:50:07 - 00:35:54:12
I know that you're I think you're still a board member, obviously a cofounder.

00:35:54:21 - 00:35:56:05
What is the future?

00:35:56:05 - 00:36:00:25
Are we looking at that in the Amazon rental business?

00:36:01:05 - 00:36:03:11
What's what's the vision?

00:36:03:11 - 00:36:06:00
Yeah. So it's obviously a really interesting moment.

00:36:06:00 - 00:36:08:10
Like we started Rent the Runway in a recession.

00:36:08:10 - 00:36:11:22
And I think so many innovative, interesting ideas come out of recessions.

00:36:11:22 - 00:36:14:08
Consumer thinking changes.

00:36:14:08 - 00:36:17:20
The opportunity cost of other jobs that pay less or less

00:36:17:20 - 00:36:20:22
interesting is lower, so people kind of go to entrepreneurial roles.

00:36:20:29 - 00:36:23:10
But this is a different kind of recession, and this is one

00:36:23:10 - 00:36:25:27
that's actually challenging the fundamental nature of like,

00:36:25:28 - 00:36:27:27
do you need to get dressed every day?

00:36:27:27 - 00:36:31:16
And if you do, does it matter what you wear or do you need to change

00:36:31:16 - 00:36:32:12
over your outfits?

00:36:32:12 - 00:36:36:11
And when people are Instagramming and putting social media posts less often,

00:36:37:01 - 00:36:42:09
bam in a fancy dress at an event versus outdoor nature or their kids or a pet,

00:36:42:09 - 00:36:44:26
you know, whatever the case, that or the food that they cook that night.

00:36:45:18 - 00:36:49:19
So it's a very strange, unexpected twist to kind of our world

00:36:49:19 - 00:36:50:26
and our value proposition.

00:36:50:26 - 00:36:55:01
That's, I think, for a lot of creative thinking in terms of like what do we mean?

00:36:55:01 - 00:36:56:26
What does our brand mean to our consumers?

00:36:56:26 - 00:37:00:04
And like, what are other things we can do to empower

00:37:00:04 - 00:37:03:04
and embrace this strong community business that we felt?

00:37:03:04 - 00:37:05:07
So a lot of creative thinking to come.

00:37:05:07 - 00:37:08:21
And I do think kind of leaning into that community aspect

00:37:09:16 - 00:37:12:05
is something that we think a lot about.

00:37:12:05 - 00:37:15:08
But I also believe that and what we think about is like

00:37:15:10 - 00:37:17:13
how do we make ourselves as strong as possible

00:37:17:13 - 00:37:20:27
so that coming out of this moment, when people are excited to go to events

00:37:21:07 - 00:37:24:16
and dress up and you know, it feels so good to do that.

00:37:24:23 - 00:37:27:20
I think we have this huge kind of lift off potential.

00:37:27:20 - 00:37:29:04
And so how do we get it?

00:37:29:04 - 00:37:32:19
How do we kind of accommodate and address that I think

00:37:32:19 - 00:37:36:12
especially because people are not buying as many of those fancy items right now,

00:37:36:12 - 00:37:37:04
because it's such

00:37:37:04 - 00:37:40:05
an unpredictable thing of when can they wear them, what can they do?

00:37:40:05 - 00:37:42:09
There's going to be a real need for that.

00:37:42:09 - 00:37:42:15
You know,

00:37:42:15 - 00:37:44:26
when the flips, the switches or flips to go back to work,

00:37:44:26 - 00:37:46:10
I think there's a real kind of like actual

00:37:46:10 - 00:37:50:19
need for people to have that that those products, those inventory.

00:37:50:19 - 00:37:54:19
And I think we're in a moment right now where everyone is a little bit

00:37:54:19 - 00:37:57:06
sick of the clutter of their lives in their closets.

00:37:57:19 - 00:38:01:01
And so the element of of rental on the sharing economy,

00:38:01:01 - 00:38:04:29
I think, is just enforced and enhanced in terms of like, yes,

00:38:05:00 - 00:38:07:28
invest in some of those key pieces in a smart way,

00:38:08:07 - 00:38:11:26
but I don't need like all the dresses I do own,

00:38:11:26 - 00:38:13:25
which are few now, but like they've been sitting there

00:38:13:25 - 00:38:15:12
like a lot, like, why do I have these there?

00:38:15:12 - 00:38:18:11
It's not to use my space, my life, the time it takes to kind of

00:38:18:20 - 00:38:22:24
consider what I'm wearing every day is just a silly waste of a waste of time.

00:38:23:13 - 00:38:26:05
And how rental can simplify your life, I think

00:38:26:29 - 00:38:30:14
is really an exciting opportunity that we're

00:38:30:14 - 00:38:33:18
at the forefront of taking advantage of when we come out of all of this.

00:38:33:18 - 00:38:36:15
So we're kind of preparing and wrapping up for that.

00:38:36:15 - 00:38:38:22
It's really clear that from what you said, that you obviously think

00:38:38:22 - 00:38:42:14
very deeply about the future of fashion and the future of consumerism.

00:38:43:00 - 00:38:46:02
You've innovated with Rent the Runway from scratch.

00:38:46:12 - 00:38:50:15
You've also innovated within one of the largest businesses in the world, Wal Mart.

00:38:50:17 - 00:38:55:01
As co-founder and CEO of Jet Black, what did you learn from that experience

00:38:55:01 - 00:38:59:11
about how corporates can actually have an advantage in certain things

00:38:59:11 - 00:39:00:06
when they try and innovate

00:39:00:06 - 00:39:03:06
and then also how they struggle because of their size and scale?

00:39:04:14 - 00:39:06:21
Yeah, it's super fascinating experience.

00:39:06:21 - 00:39:11:28
So I built and ran the first business in Walmart's technology incubator,

00:39:12:16 - 00:39:17:16
and the idea was that in addition to growing their core business day to day

00:39:17:16 - 00:39:18:12
and thinking about

00:39:18:12 - 00:39:22:01
how to evolve their e-commerce site, which they're doing a great job with,

00:39:22:16 - 00:39:23:24
what would they think about four,

00:39:23:24 - 00:39:27:19
five years down the road, ten years down the road to start to kind of learn

00:39:27:19 - 00:39:30:19
and understand different technologies to best position themselves

00:39:30:27 - 00:39:34:08
for some of the trends that that were down the pipeline.

00:39:34:08 - 00:39:37:06
And one of those areas is conversation and commerce.

00:39:37:06 - 00:39:40:22
So the idea of shopping with a voice type of interaction, right?

00:39:40:22 - 00:39:44:08
And so whether you think of Alexa and Google Home is as one example.

00:39:44:26 - 00:39:48:06
And the area that we started our work in testing on the step

00:39:48:06 - 00:39:51:21
black was around text message, so shopping over text message.

00:39:52:13 - 00:39:56:20
And I think the many learnings that you have with that modality,

00:39:56:20 - 00:40:01:15
they were very powerful for Walmart because with a blank field of text message

00:40:01:15 - 00:40:02:08
or voice,

00:40:02:08 - 00:40:05:25
you can get the raw kind of unfiltered consumer interest

00:40:05:25 - 00:40:07:21
demand the questions that they have.

00:40:07:21 - 00:40:09:18
And so the learnings are much more equivalent

00:40:09:18 - 00:40:13:12
to what you would experience in a store with a store clerk helping

00:40:13:12 - 00:40:17:13
you versus what you try to interpret from data on a website.

00:40:17:13 - 00:40:20:12
So there's a lot of information and data that we're able to kind of

00:40:20:20 - 00:40:23:17
collect and gather and a lot of technology that we're able to validate

00:40:23:17 - 00:40:28:06
that I think will help Walmart Pioneer and kind of blaze a unique path

00:40:28:27 - 00:40:33:02
that leverages their advantages into the future of conversational commerce.

00:40:33:02 - 00:40:35:14
And so I feel super proud about that.

00:40:35:14 - 00:40:39:11
You know, I think the tricky subtlety is how much do you leverage

00:40:39:11 - 00:40:41:27
the infrastructure of these big businesses,

00:40:42:12 - 00:40:44:15
which can let you get off the ground much more quickly?

00:40:44:15 - 00:40:47:00
Things like finance, legal, h.r.

00:40:47:00 - 00:40:49:09
But can also have impacts to the culture

00:40:49:16 - 00:40:53:07
or certain decisions that you make down the pipeline that you didn't anticipate

00:40:53:15 - 00:40:57:12
a review process or promotional process, a bonus process.

00:40:57:12 - 00:40:59:04
If you're using certain h.r.

00:40:59:04 - 00:41:01:19
Systems and if you're tied in certain ways,

00:41:01:19 - 00:41:04:15
financial systems and budgeting processes are great.

00:41:04:15 - 00:41:05:20
If you can use those systems.

00:41:05:20 - 00:41:09:06
But do you then become accountable to the kind of larger

00:41:09:06 - 00:41:12:06
organizations, annual budgeting processes and how that works?

00:41:12:22 - 00:41:16:27
So I think it's like all good entrepreneurial endeavors,

00:41:17:09 - 00:41:22:05
a work in process.

00:41:22:05 - 00:41:29:10
And now we turn to the Q&A.

00:41:29:10 - 00:41:32:20
Let's go to autonomously next on a, of course, co-founder of Net

00:41:32:21 - 00:41:35:27
Support saying our successful investor on a ship.

00:41:36:18 - 00:41:38:23
As in again you me. Hi.

00:41:38:23 - 00:41:40:09
Yes hi.

00:41:40:09 - 00:41:42:09
First I like yeah like really congratulations.

00:41:42:09 - 00:41:43:19
Huge fan of what you've created.

00:41:43:19 - 00:41:46:02
It's really game changer for sure.

00:41:46:27 - 00:41:52:16
I guess when you created it, the main business driver was towards

00:41:52:17 - 00:41:55:17
women who couldn't really afford to buy a dress

00:41:55:17 - 00:41:59:05
and actually it was cheaper to rent it and we turned back.

00:42:00:09 - 00:42:01:06
Now the question

00:42:01:06 - 00:42:03:26
is regarding sustainability and

00:42:04:29 - 00:42:07:16
there's a great opportunity

00:42:07:16 - 00:42:11:28
to put pressure on fashion designers who should create collection.

00:42:12:00 - 00:42:16:21
Who could you only rant because then you would force customers

00:42:16:21 - 00:42:20:00
to actually that the only option is to rent.

00:42:20:01 - 00:42:23:14
And it's not because they can't afford it is because that the only way to be able

00:42:23:14 - 00:42:29:03
to do have to wear the latest dress from Prada or whatever designer's foot.

00:42:29:04 - 00:42:32:03
So for you is that you as as as the

00:42:33:08 - 00:42:34:13
creator of such a brand,

00:42:34:13 - 00:42:38:14
what kind of pressure can you put on brands to create collections

00:42:38:14 - 00:42:41:13
specifically actually to to rent and not to buy?

00:42:42:20 - 00:42:45:28
That's a really great, great question

00:42:46:13 - 00:42:49:01
and great sort of kind of that that angle.

00:42:50:02 - 00:42:51:04
I'll break it into two things.

00:42:51:04 - 00:42:54:16
So I think, you know, first off, the sustainability component of our business,

00:42:55:08 - 00:42:59:24
what's fascinating is like it has always been a sustainable business, right?

00:42:59:24 - 00:43:03:24
We we are both as thoughtful as we can be around the cleaning

00:43:03:24 - 00:43:07:04
solutions and solvents we use for dry cleaning being as sustainable as possible.

00:43:07:09 - 00:43:10:08
The packaging we ship in being reusable packaging

00:43:10:08 - 00:43:13:27
like we've done a lot in the space, but the mere concept of rental and sharing

00:43:14:04 - 00:43:15:28
is sustainable in and of itself.

00:43:15:28 - 00:43:19:07
Yet it's only now ten years in in the last year

00:43:19:14 - 00:43:22:22
that I think we've gotten any real credit or appreciation from consumers.

00:43:22:22 - 00:43:23:18
So I think to some extent

00:43:23:18 - 00:43:27:02
we've been like kind of being out there like saying, hey, and it's sustainable.

00:43:27:10 - 00:43:31:04
And now I think it's more and more often like one of the first questions

00:43:31:04 - 00:43:32:24
or things that people want to talk about.

00:43:32:24 - 00:43:34:19
So I think that's an exciting thing

00:43:34:19 - 00:43:38:18
that we're we're getting credit for that as a brand and that there's more consumers

00:43:38:19 - 00:43:41:29
saying like, Hey, I picked you because of this aspect.

00:43:41:29 - 00:43:46:00
And and I think at the end of the day, it all comes down from kind of what

00:43:46:00 - 00:43:47:21
what leverage can we get with the designers?

00:43:47:21 - 00:43:50:19
It all comes down from consumers voting with their wallets, too, right?

00:43:50:19 - 00:43:53:17
So I think the more it matters to consumers

00:43:54:04 - 00:43:57:27
and the more we can kind of like have their testimonials in the theater

00:43:57:28 - 00:44:01:18
like that is why they are renting as proof points and data points.

00:44:01:18 - 00:44:03:19
The more we can use that to work with designers,

00:44:04:03 - 00:44:06:21
we do have a bunch of designers that we quote co-create

00:44:06:21 - 00:44:09:21
capsule collections that are for rent only.

00:44:10:08 - 00:44:12:16
So I don't think we any brands yet where

00:44:13:03 - 00:44:16:14
except the couple that we've created as our private label brands

00:44:17:14 - 00:44:19:19
where they only rent all of their products.

00:44:19:19 - 00:44:24:10
But we certainly have a bunch of brands and fantastic designer names and labels

00:44:24:15 - 00:44:28:14
where this like kind of capsule collection that we co-create is only available

00:44:28:14 - 00:44:29:13
for rent.

00:44:29:13 - 00:44:32:18
But there's probably more that we could do to lean into that from a sustainability

00:44:33:01 - 00:44:33:26
perspective.

00:44:33:26 - 00:44:37:18
Let's go next to Morris Tapping, who's the CEO of Accelerate,

00:44:37:25 - 00:44:40:02
which promotes the inclusion of women in technology

00:44:40:18 - 00:44:43:05
who I should give a quick plug to her event that's

00:44:43:05 - 00:44:45:23
coming up on the 12th of June, but none other than Hillary Clinton.

00:44:46:11 - 00:44:47:14
Yeah, I saw that.

00:44:47:14 - 00:44:50:08
I was excited about that as well. It must come.

00:44:50:08 - 00:44:52:29
Jenny asks the question, but the last question.

00:44:53:03 - 00:44:54:14
Yeah, go ahead, Laurie.

00:44:54:14 - 00:44:56:17
Thank you so much and thanks for the plug.

00:44:56:17 - 00:45:01:06
I'm really loving this topic is brilliant and good and I love your point

00:45:01:06 - 00:45:04:29
that it's really important for families to also be the consumers of the business

00:45:04:29 - 00:45:05:28
as you were.

00:45:05:28 - 00:45:09:03
And that we know that women who are building

00:45:10:10 - 00:45:12:18
businesses for women often really struggle to get funding

00:45:12:18 - 00:45:15:25
because they go to VCs who are often mostly male,

00:45:16:11 - 00:45:18:24
who don't understand the kind of business they're trying to build.

00:45:18:24 - 00:45:21:07
I mean, we know, for example, Heidi back from Belfast

00:45:21:07 - 00:45:25:13
who said she was pitching all over it and talking to people who were experts

00:45:25:13 - 00:45:26:20
in cyber and crypto.

00:45:26:20 - 00:45:29:01
But she completely lost the when she saw one in broad.

00:45:29:12 - 00:45:33:12
And what what would you how did you find the fundraising process

00:45:33:26 - 00:45:36:21
when you're building a consumer business for women and

00:45:37:02 - 00:45:41:13
and what advice would you have for women founders in that situation?

00:45:41:22 - 00:45:42:20
Yeah, absolutely.

00:45:42:20 - 00:45:44:17
It's a topic I'm very passionate about.

00:45:44:17 - 00:45:48:08
And luckily I have seen improvements in the past ten years.

00:45:48:08 - 00:45:50:17
We have a lot more ground to cover.

00:45:50:17 - 00:45:53:27
So personally for us, the early, early stages

00:45:53:27 - 00:45:58:08
because that is raising our seed round somewhat our A, but mostly

00:45:58:08 - 00:46:01:24
our seed round where you don't have much of anything to show for it.

00:46:01:24 - 00:46:04:27
You're really like two young women with an idea going out there.

00:46:05:03 - 00:46:08:20
That's when I think that most of the biases really came out.

00:46:09:00 - 00:46:13:19
And so everything from people treating us like, Oh, that's nice, that's cute.

00:46:13:19 - 00:46:15:23
Like two girls working on a fashion idea.

00:46:16:19 - 00:46:19:19
Let me ask my secretary what they think of this,

00:46:19:19 - 00:46:23:12
like pull in my daughter and stuff that felt a little pedantic and like,

00:46:23:12 - 00:46:27:09
not that we were running a serious business or taking us as

00:46:27:10 - 00:46:30:16
seriously that just didn't feel good, right.

00:46:30:16 - 00:46:31:22
And I think for us, like,

00:46:31:22 - 00:46:35:25
we had the privilege of kind of like voting with

00:46:35:29 - 00:46:38:08
where we chose to take funding, like we had enough interests

00:46:38:08 - 00:46:40:02
that were like, we don't want to work with those people, right?

00:46:40:02 - 00:46:40:23
So I think aligning

00:46:40:23 - 00:46:44:28
with the right partners that understood us, respected us, the partner,

00:46:44:28 - 00:46:49:10
we took money from Bain Capital Ventures, who's invest with us every round since

00:46:50:15 - 00:46:53:04
even though it was a male partner, Scott Friend, who's

00:46:53:04 - 00:46:56:19
was just fantastic and deserves the title, co-founder alongside us,

00:46:56:27 - 00:47:01:27
he came to those pop up tests, so we invited a bunch of VCs.

00:47:01:27 - 00:47:04:13
We're like, Hey, we're doing these trials and come if you want.

00:47:04:18 - 00:47:05:20
Like he came, he saw

00:47:05:20 - 00:47:08:26
and he was so he's like, No, like I am not a woman that can understand

00:47:08:26 - 00:47:11:16
the actual emotional value, but I can see that girls twirl around 

00:47:11:16 - 00:47:15:29
in the gold dress, I can talk to them, I can ask them questions and actually

00:47:16:07 - 00:47:19:26
for those who didn't come to the pop up, we took video.

00:47:19:26 - 00:47:22:27
So another thing I tell all female entrepreneurs

00:47:22:29 - 00:47:27:00
that we started doing was to show rather than starting every pitch, meeting

00:47:27:06 - 00:47:29:20
with these videos of the girls twirling in the gold dress

00:47:29:20 - 00:47:32:24
or the interviews of like the testimonials so that people could understand

00:47:32:24 - 00:47:36:19
it wasn't just about the product, it was about that emotional, empowering

00:47:36:19 - 00:47:40:14
feeling of wearing designer fashion that was really helpful for us.

00:47:40:22 - 00:47:45:02
And I think now there's more and more of a network, more 

00:47:45:04 - 00:47:45:29
female VCs for sure.

00:47:45:29 - 00:47:51:25
Then there were. I personally invest and a lot of female run & founded businesses

00:47:52:02 - 00:47:53:15
and you know

00:47:53:15 - 00:47:56:27
I think the data of women influence

00:47:56:27 - 00:48:02:01
over 80% of e-commerce purchase decisions I think were poor decisions overall,

00:48:02:14 - 00:48:05:07
which means that we are better able to kind of step

00:48:05:07 - 00:48:08:04
into the psyche of that consumer and create products for them.

00:48:08:20 - 00:48:11:09
I think is is getting a lot more receptivity,

00:48:11:09 - 00:48:15:04
the ability to penetrate industries like fashion,

00:48:15:04 - 00:48:18:24
which are thought of as these kind of more fluffy female businesses,

00:48:19:04 - 00:48:22:22
because we've had businesses now like Rent the Runway or Gilt succeed

00:48:23:14 - 00:48:27:12
Glossier You know, like I think there's a lot more people

00:48:27:12 - 00:48:30:12
and women out there also getting good press and building,

00:48:30:12 - 00:48:34:21
you know, this roadmap for how it is possible, how it can be done.

00:48:34:21 - 00:48:37:13
So I'm very encouraged by it.

00:48:37:28 - 00:48:40:29
I, I will commit kind of the rest of my career

00:48:40:29 - 00:48:43:19
to trying to help further that in any way that I can.

00:48:44:09 - 00:48:47:17
Let's go to Pippa, who is a partner of Sweet Capital.

00:48:47:21 - 00:48:50:05
So a lot of the founders who pitched me at the moment

00:48:50:05 - 00:48:53:15
with the kind of sustainable rental fashion businesses I think

00:48:53:15 - 00:48:56:25
come at it from more of a curation for more of a fashion perspective.

00:48:57:18 - 00:49:00:16
And it was pointing towards the learnings that you guys had.

00:49:00:28 - 00:49:04:22
So I guess what is the one operational breakthrough

00:49:04:24 - 00:49:07:23
that you guys made that really transformed the business?

00:49:07:23 - 00:49:09:08
Was it how you do collections?

00:49:09:08 - 00:49:10:28
Was it how you did packaging know?

00:49:10:28 - 00:49:13:29
What was that one thing you'd point to that made your life a lot easier?

00:49:15:19 - 00:49:17:12
There were a lot of there have been a lot.

00:49:17:12 - 00:49:22:21
But I think the biggest thing is the ability to turn items around the same day.

00:49:22:21 - 00:49:26:00
Like that's the real secret sauce and there's a lot of operational

00:49:26:18 - 00:49:28:25
and dry cleaning, you know, all the stuff that

00:49:29:10 - 00:49:32:10
and vertical integration that enables that to happen, right.

00:49:32:10 - 00:49:34:24
It's it's there's a lot that goes into that problem.

00:49:34:24 - 00:49:37:26
But being able to do that lets

00:49:37:26 - 00:49:41:21
you spend less money on your inventory, right?

00:49:41:21 - 00:49:45:23
So like keep that cost as low as you possibly can

00:49:46:13 - 00:49:50:18
to get customers and subscription their product as quickly as possible.

00:49:51:15 - 00:49:54:05
But I think it enables the most capital efficiency

00:49:54:05 - 00:49:56:23
that you can get in a model like this if you can do that.

00:49:57:26 - 00:49:58:10
Great.

00:49:58:10 - 00:50:00:15
Thank you, Pippa and Jenny, thank you so much.

00:50:00:20 - 00:50:02:24
And inspiration and lots of fun.

00:50:03:01 - 00:50:04:06
Thanks for having me.

00:50:04:06 - 00:50:06:17
Really appreciate you joining my five minute. Thanks so much.

00:50:06:17 - 00:50:08:01
And thanks for joining us, everyone.

00:50:08:01 - 00:50:11:04
Thanks, everyone. Anything.