Harvard Business school classmates Jenny Fleiss who studied finance and Jenn Hyman in sales, always dreamed of becoming entrepreneurs. The two would meet for lunch once a week to brainstorm exciting business ideas. It was during one of these casual lunches that Hyman relayed an idea she had when her sister Becky experienced an everyday woman’s dilemma. Becky had a wedding coming up and didn’t want to spend a fortune on a dress she would only wear once. And let’s cut the bs here because we all do it. Buy an obscenely expensive dress knowing full well you are going to return it the next day and be met met with raised eyebrows when you profess, ‘it just didn’t fit right.’ And so with women in need without the bank balances to back up their fashion must-haves, Rent the Runway was born. A “Netflix for dresses’’ where you could peruse through designer gowns and pick and choose what you wanted for a fraction of the price.
So how has Rent The Runway turned from an idea into a $100 million dollar company with over four million members who can choose from 200+ top designer brands?
The idea for Rent the Runway was only a day or two old when they cold-emailed Diane von Furstenberg saying “I’m the founder of Rent the Runway. Can my partner and I meet with you?” and were surprised when they actually got a response: “Sure, how about tomorrow?”
Fleiss explains that the idea for Rent The Runway was only a day or two old when they cold-emailed Diane von Furstenberg saying “I’m the founder of Rent the Runway. Can my partner and I meet with you?” and were surprised when they actually got a response: “Sure, how about tomorrow?” Did they lose their shit? No, they dressed up in Diane von Furstenberg dresses, drove to New York City from Boston, walked in with confidence and bossed it. Fleiss says, ‘Diane gave us her honest feedback that we needed to strengthen our business plan, and she also introduced us to several other designers. That was how we got in the doors initially to see top designers, like Proenza Schouler.’
Instead of spending time writing a business plan and strategising, the girls decided to dive straight in making mistakes along the way and changing direction when needed.
Fleiss explains how they experimented with their idea on campus grounds, ‘We started by purchasing dresses at retail in our own sizes—we figured if the concept didn’t work, at least we’d have a great wardrobe! We just went to different undergraduate campus and started renting dresses to women. We went to Harvard on a weekend we knew they had an event. Then we went to Yale, and we rented the dresses, but didn’t let women try them on. For the third trial, we sent a PDF out to students that said “call us if you want to rent this dress.” So, each time we were iterating a little bit closer to what our actual concept was—an internet dress rental site—to prove that it was really going to work.’
Armed with a positive reaction to their brain-child, Fleiss and Hyman went on to raise $100 million in venture backing. Although selling a fashion concept to 60-year-old men proved to be a tough pitch as they couldn’t understand the emotional connection that women have with fashion. So the girls came up with a genius solution! They would take video footage and show the investors the experience that women were having, which was: MIND BLOWN.
The duo were also ballsy in their approach. “The way venture capital works is they are looking for the next billion-dollar company. It doesn’t favour companies that think, ‘Let’s make $50 million a year,’” Fleiss said “And women don’t really go in and say they have the next billion-dollar idea.”
“More women need to do so, and they also need to be able to tell venture capitalists how their concept can be “truly transformative to the industry.” Because if venture capital fund 10 companies, they only expect one to be the billion-dollar company and the rest fall to the wayside and stop getting the help,’’ Fleiss said.
Now seven years later, Fleiss and Hyman have rapidly grown and employ 250 employees and are working on an exciting new business model: an unlimited subscription service for everyday wear.
‘we started a fashion technology company with no fashion or technology experience!’
The biggest challenges the duo have met is their zero experience in technology as well as fashion. Fleiss reflects, ‘we started a fashion technology company with no fashion or technology experience!’
Evidently, that did not hold them back. They talk about their surprise of how everything has unfolded and that they were actually able to do it. Hyman acknowledges, ‘’we were two women without any experience in leading companies. I had led teams before, but nothing like this. I don’t even think I dreamed as big for myself as this company already is, in just the first few years. It’s surprising when you don’t put blockades in front of yourself, and you just allow yourself to run, how far you can go.’’
So what advice they have for entrepreneurs who’d like to follow in their footsteps?
Go for it! There are not as many risks as you feel there are.
If It doesn’t work out then move on, everything is a learning experience.
Test the concept out and be brutally honest with yourself.
Don’t just sit their with your ideas, figure out a way to see if it’s going to work.
Love and believe in the concept.
Be willing to work after hours, recruit new candidates, and go to events, let your work become your life.
Insert energising activities in your day that can give you a boost such as a type of meeting, a run, or seeing a friend for lunch.
Your business has to mean more than making money, have a greater purpose behind what you are doing.
Be humble, be curious and listen to the people who have come before you.
Understand that entrepreneurship only gets harder every year and as your team gets bigger, the stakes get higher. The amount you personally invest of your emotional energy and sanity gets a lot higher.
I was suddenly thrust into a work environment with office politics, and where it was considered inappropriate for women to be vocal and confident in meetings. After one meeting, an older woman pulled me aside and told me basically to “shut up” and that even though my ideas were really smart, I was coming across as too bossy for a girl.
Hyman also talks about the importance of having a voice within the professional world:
‘’At my first job out of college, when I was 22, I had an experience that changed my whole career path. In college, where we are encouraged to express our opinions and speak out, I was suddenly thrust into a work environment with office politics, and where it was considered inappropriate for women to be vocal and confident in meetings. After one meeting, an older woman pulled me aside and told me basically to “shut up” and that even though my ideas were really smart, I was coming across as too bossy for a girl, and recommended I be sweeter and more flirtatious in meetings.
Given that this advice was coming from a woman I respected, it was even harsher to hear it, and I started crying in the office. Jim Barra, an SVP at the time, took me into his office, and I recounted the experience. What he said inspired me and pushed me to be an entrepreneur. Jim told me to continue to be myself and to be confident. He said to evaluate who was the one giving me feedback, and whether they are someone I should listen to; not everyone who is older than you or more experienced is worth listening to.
If I had listened to that woman, my career would have taken me in a totally different direction. I would never have been an entrepreneur today or be in a situation where I’d be comfortable expressing my ideas. Sometimes you have to have confidence in your own manner and go for it. I think that his belief in me is what set me off on a journey to do amazing things with my career.’’
Hyman and cofounder Fleiss have landed on Forbes’ 2016 Women to Watch list. And their clientele seems to be growing with the ‘Instagram effect’ where the trend of chronicling outfits is paramount to getting those likes and followers, and repeating a look is seen as sacrilegious. Why buy the cow when you can get the milk for a fraction of price?