For many, the pandemic has made us reevaluate how we view our living situations and our possessions. As millions flocked to remote lifestyles, they were also forced to downsize and shed items including clothing. Wardrobe is a peer-to-peer fashion rental marketplace that allows users to rent out their fashion items to aspiring fashionistas and earn. For renters, they are able to access high-end and unique items while participating in a sustainable circular economy at a time where $400B+ of clothing is discarded each year. The company, founded in 2018, uses retail dry cleaning locations as hubs for its service where renters can pick up and drop off clothing if they are in NYC. The dry cleaners also provide storage and cleaning while earning incremental revenue. Items can also be shipped nationwide for those not near a hub. Wardrobe charges ~35% of the rental fee as a service charge.
AlleyWatch caught up with Wardrobe CEO and Founder Adarsh Alphons to learn more about how Wardrobe is making fashion more sustainable, the company’s celebrities influencers, strategic plans, latest funding round, which brings the total funding raised to $5.9M, and much, much more.
Who were your investors and how much did you raise?
Recently, Slow Ventures led a $4.1M Series Seed round, joined by Foundation Capital, Casper cofounder Neil Parikh, and Grammy-winning artist Leon Bridges.
Wardrobe’s cap table currently includes founders of Airbnb, Coinbase, Opendoor, HQ Trivia and Vine, and early investors of Farfetch, Rebag, Uber and SpaceX, collectively adding decades of world-class marketplace expertise. Wardrobe’s Advisory Board includes Nate Blecharzyck, cofounder, Airbnb
Tell us about the product or service that Wardrobe offers.
Wardrobe is a peer-to-peer fashion rental marketplace for creators to connect with their fans and monetize their closets. We turn creators’ style into cash and their fans into super fans through a virtuous cycle of authentic engagement.
What inspired the start of Wardrobe?
Since 2000, consumer demand for fashion has increased by 2X. The recent answer to record-high demands for new designs until now has been ‘fast fashion.’ Fast fashion is a wasteful solution. Every year over $400B worth of clothing is thrown away, clogging up the arteries of the world.
Today, nearly everyone in the U.S. knows what it’s like to look into their overfull closet and feel like they have nothing to wear– pre-pandemic, the average woman in the U.S. had 55 items in her closet that she wore less than once a year (a number that has since skyrocketed).
Our customers love experimenting with fashion but don’t have unlimited funds; meanwhile, fashion brands have made themselves aspirational by limiting accessibility and it is hurting sustainability. Wardrobe gives everyone access to high-end and unique fashion items, thereby creating a more sustainable fashion ecosystem.
How is Wardrobe different?
Wardrobe partners with local dry cleaners to turn them into fashion hubs that provide the cleaning, storage and serves as neighborhood access points where users can pick up/return their rented items.
The future of fashion rental is peer-to-peer. Traditional fashion rental services are economically inefficient and expensive to scale. Wardrobe’s platform embodies the circular fashion movement and, just by participation, makes users a part of the sustainability solution.
If correctly executed, our crowd-sourced inventory will naturally surpass any single-buyer model. Growth + margins achievable with Wardrobe are unparalleled.
What market does Wardrobe target and how big is it?
Here is how we view the two sides of our market –
Renter/demand-side: GenZ
Coresight Research estimated the U.S. rental apparel market to reach $1.2 billion in 2021. Our core demographic within that market is GenZ — who, for the majority on the platform, experience luxury fashion for the first time through Wardrobe. Overall, Wardrobe rental orders have grown 10-fold in the past few months, proving that consumers are ready for an Airbnb of fashion.
Lender/supply-side: Fashion creators (GenZ and beyond)
In addition to the fact that there is a surplus of unworn/ under worn items in our closet, Wardrobe aims to create an avenue that connects fashion creators (influencers, stylists and celebrities) with their fans. We’re also a bit like Cameo in that Wardrobe lets you borrow from the closets of some of the most coveted influencers and celebrities, bridging IRL-URL and making the experience highly social. The company is increasingly well-positioned to disrupt not only fashion, but social commerce in general and make the planet more sustainable.
What’s your business model?
We take service fees from every rental order. Our service fees are approximately 35% of the price of each order placed. Rental order prices are based on a few factors such as the item’s retail price, condition, and aggregate demand for that item.
We do not have any CAPEX or large fixed costs, since we do not own any inventory, warehouses, or dry-cleaning machines. Our costs are restricted to acquire creators, digitizing inventory, matching supply with demand, and iterating our product.
We do not have any CAPEX or large fixed costs, since we do not own any inventory, warehouses, or dry-cleaning machines. Our costs are restricted to acquire creators, digitizing inventory, matching supply with demand, and iterating our product.
What are your post-COVID office plans??
We’re a small team and fortunately, most of our team prefers working from the office, so we’re in-person. That is not to say that the team doesn’t travel a fair bit and can work remotely if that’s what makes them happy. We’re flexible.
What was the funding process like?
We were connected to Kevin Colleran from Slow Ventures through an existing investor and cofounder of Airbnb, Nate Blecharczyk, and as they say, the rest was history.
What are the biggest challenges that you faced while raising capital?
We actually closed the round in April but didn’t announce it until now. We began fundraising in October, so mid-COVID, pre-vaccine; it was really tough, especially since we’re in the sharing economy space. We had growing demand from customers, but it was a drastically different time then.
What factors about your business led your investors to write the check?
The fact that we are capital-light (by working with dry-cleaners), showing strong traction with creators.
What are the milestones you plan to achieve in the next six months?
Help creators earn as much as possible on the platform & drive an influx of fashion creators, achieve a steady cadence of double-digit organic growth, and product development.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Keep your burn low. Keep pitching investors and iterate your message based on traction. When you finally find the right investors, you’ll forget about all the passes and declines along the way.
Where do you see the company going now over the near term?
We’re hoping to aggregate fashion creators and help them form meaningful relationships with their audiences through fashion.
What’s your favorite outdoor dining restaurant in NYC
FourFiveSix.
