Jen Hyman's journey as an entrepreneur began within her dynamic and empathetic family environment in New Rochelle, New York, which significantly shaped her leadership qualities. Growing up in a chaotic household with a severely disabled sister instilled a deep sense of teamwork and empathy in Jen. These traits later translated into an ability to foster collaborative and enthusiastic teams, a skill she carried into her career endeavors, including her unique and successful venture, Rent the Runway. Her perspective on overcoming societal norms around disabilities further contributed to her resilience and innovative mindset.
Her entrepreneurial spirit was further honed during her early career at Starwood Hotels. Shortly after joining, Jen spotted an opportunity amidst the post-9/11 travel industry crisis. She identified a shift in consumer behavior related to weddings and honeymoons, which led her to propose and develop a profitable honeymoon registry. This experience taught her the power of influence over authority, as she engaged and inspired people from different divisions to bring her idea to fruition, highlighting her leadership and foresight into societal trends.
Main takeaways from the video:
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Key Vocabularies and Common Phrases:
1. implication [ˌɪmplɪˈkeɪʃən] - (noun) - The conclusion that can be drawn from something, although it is not explicitly stated. - Synonyms: (suggestion, inference, insinuation)
But it's also a financially kind of crippling situation to have someone in your life that you love, that you are effectively supporting for their entire lives.
2. entrepreneurial [ˌɒntrəprəˈnɜːriəl] - (adjective) - Characterized by the taking of financial risks in the hope of profit; enterprising. - Synonyms: (business-minded, enterprising, pioneering)
And I actually thought that it would be pretty interesting to go work for a travel company at the time, because I thought that they're going to have to innovate or they're going to die. And so it might be an interesting environment to be entrepreneurial.
3. innovative [ˈɪnəˌveɪtɪv] - (adjective) - Featuring new methods; advanced and original ideas. - Synonyms: (groundbreaking, inventive, original)
I'm so excited to talk about the innovative business that you built
4. transcend [trænˈsɛnd] - (verb) - To go beyond the range or limits of something abstract, typically a conceptual field or division. - Synonyms: (exceed, surpass, excel)
And that was really a light bulb. That. Number one, what she cared about was the experience of walking into the room and feeling awesome. She didn't actually care about this physical asset of the dress.
5. empathy [ˈɛmpəθi] - (noun) - The ability to understand and share the feelings of another. - Synonyms: (compassion, understanding, sympathy)
And it also sounds like your upbringing made you quite an empathetic leader as well.
6. influence [ˈɪnfluəns] - (noun) - The capacity to affect the character, development, or behavior of someone or something. - Synonyms: (impact, authority, power)
And I had to influence hundreds of people around the world in different divisions to help me build a new website, to help me build a new piece of technology, to help me build a new reservation system, like, to help me take totally different photographs of all of the hotels that emphasize the pool and the leisure assets as opposed to like the conference rooms
7. disruptive [dɪsˈrʌptɪv] - (adjective) - Causing or tending to cause disruption; innovative or groundbreaking. - Synonyms: (unsettling, innovative, revolutionary)
Does this already exist? Because often even disruptive ideas like, they already exist, it just takes a change of how you're thinking about the situation to understand, does this exist? And I started thinking about, like, does this idea of renting clothes or not having clothes forever, does it exist? And I resolved, not only does it exist, but this is like 85% of how we already shop
8. cannibalize [ˈkænɪbəˌlaɪz] - (verb) - To affect sales of an existing product negatively by introducing another closely related product. - Synonyms: (consume, reduce, absorb)
And she hated this idea. Hated the idea. She thought that she's like, why would I ever do this? Like, you're going to cannibalize my entire business.
9. pioneer [ˌpaɪəˈnɪr] - (verb) - To develop or be the first to use or apply a new method, area of knowledge, or activity. - Synonyms: (introduce, establish, develop)
Like, really crazy, disruptive idea into really pioneering a category.
10. proposition [ˌprɒpəˈzɪʃən] - (noun) - A statement or assertion that expresses a judgment or opinion. - Synonyms: (proposal, suggestion, offer)
And that creates positive word of mouth, like, positive net promoter score in your brand value proposition, in addition to net promoter score in your consumer value proposition
Jennifer Hyman, Co-founder and CEO, Rent the Runway
Jen, welcome to Stanford. I'm so excited to be here. I spent the last day watching all of these View from the Top. Well, great. You're ready. So you have a lot of fans here at the gsb. In fact, at our annual GSB show that we had this past Friday, there were so many of my classmates wearing Rent the Runway that we decided to have an impromptu fashion show. Let me show you the video. Yeah. Cause girls is players too yeah, yeah. Oh, my God. Cause girls is players too Ladies getting money all around the world. Cause girls is players too. Just one thing, I think, as evidenced by this video, to all the men in the room, you are never going to meet a crop of women ever again in your life who are as awesome, beautiful, smart, ambitious as the women who are sitting here. So if that's your preference, if you are into women, spend more of your time thinking about dating when you're at school as one of the key elements of success of business school. That's a great piece of advice. I feel like you could end the interview here. I'm so excited to talk about the innovative business that you built. But let's rewind and start at the beginning of your story. You grew up in New Rochelle, New York, as one of four siblings. Tell me a bit about your upbringing and how it shaped you.
Yeah, so I grew up in a very close knit, super loving family, which I'm very fortunate for. I have a sister who is, who's autistic and she's severely disabled. So she is now 38. She can't live independently. It's very hard to understand her. And it's been a 24, 7 job for my family and my parents to care for her. And it's been both a job in terms of the heart and the actual labor that it takes. But it's also a financially kind of crippling situation to have someone in your life that you love, that you are effectively supporting for their entire lives. And I really feel in many ways that my family dynamic and the team dynamic that I saw when I was a little kid actually has made my life really about building teams.
So I very early kind of recognized that, number one, there's a lot to do when you have someone in your family who has a severe disability and your parents are humans and they're going to get tired. And there were often times that other siblings had to just step up and lead and act like the mom or the dad would have acted, that we had to actually be flexible in, like, what is our role in the family. And the second thing that I recognized is when I was growing up in the 80s, if you had someone in your family that was disabled, most families would try to hide that person away. And a lot of people were being institutionalized or at the, at the worst and at the best, people were embarrassed and they wouldn't bring that family member to a restaurant with them or to a vacation with them.
And my parents had this point of view that like, we love Sherry. Yes, she does crazy things, but like, it's better to laugh than to cry. And like she's going to come everywhere with us. We're going to go to fancy hotels, we're going to go to nice restaurants, we're going to live our life. And like, who cares what anyone thinks about us? And that mentality of just really turning things that could provoke anxiety into like, well, that was a crazy night. That's a crazy story. That was fun, as opposed to thinking about the negative with it. And also just having this point of view of like, we are going to appreciate and enjoy who we are in our life. And so I think that when I really was reflecting back, that family dynamic really gave me the confidence to think about, like building, you know, teams that I love being around lots of people.
Also the environment was so one way to describe my house growing up is energetic, but another way, it's just total chaos all the time. Like four kids, an autistic sibling who's kind of the equivalent of 15 kids. Like my parents have an almost open door policy on their life, so they're always friends and family kind of streaming out of the house. I actually love that environment, like recognizing about myself. That's what brings me the greatest joy. It's be constantly surrounded by other people that I love. And I wanted to almost create that environment for myself, not only in my job, but create that environment in my social life, create that environment in my community.
That almost like peak happiness for me is being surrounded by a community. And I think that that recognition is what's really driven my career. It also sounds like your upbringing made you quite an empathetic leader as well. So you leave New York and you graduate from Harvard as an undergrad and you begin your career at Starwood Hotels, where you soon find yourself as a 22 year old influencing hundreds of people in the organization. How did this come about and what were some of your biggest lessons learned?
So I graduated College right after September 11, and the travel industry was in shambles because people were scared to travel. And I actually thought that it would be pretty interesting to go work for a travel company at the time, because I thought that they're going to have to innovate or they're going to die. And so it might be an interesting environment to be entrepreneurial. And I got there and the company was run by an entrepreneurial founder. And about a year into working there, I kind of recognized that people were getting married later. People had different values, and as a result, like leisure travel had fundamentally changed.
And one of the aspects that I thought could be an opportunity was couples who now wanted to potentially register for their honeymoon and have their friends and family kind of gift them room nights or scuba diving or massages in instead of buying them pots and pans. Because if you're getting married when you're 30 years old, you probably have a frying pan already. And I went to the president of Starwood at the time. And at the time I think Starwood had a few hundred thousand people that worked there. So like creating a meeting with the president, it's like a 22 year old was kind of crazy, but I thought maybe he'll give me 10 minutes of his time. And I pitched him on this idea of starting the first honeymoon registry in the world and kind of an associated wedding business around it that could kind of capture a leisure customer and create loyalty with that leisure customer. And he listened to me and he was positive. And then after the meeting, my boss, I went downstairs and my boss was like, how did it go?
And I was like, it was awesome. He said, go do it. He was like. And I just started to work on it. I basically took this guy's. He didn't quite say yes, but he also didn't say no. So I took that as like, yeah, he really likes this idea. Like, he wants me to pursue it. So I started actually building out this wedding business within Starwood. And again, I was 22, no one reported to me. And I had to influence hundreds of people around the world in different divisions to help me build a new website, to help me build a new piece of technology, to help me build a new reservation system, like, to help me take totally different photographs of all of the hotels that emphasize the pool and the leisure assets as opposed to like the conference rooms.
And you realized at that time that I realized that I was doing something that was entrepreneurial, I was starting something. I had to inspire all of these people who Jen's honeymoon business was certainly not in their okrs, but I had to have them want to spend their time on building this for me. And so the first aspect of this was like, be likable. Like, no one is going to do anything for you if you're not likable. And number two is inspire them with what we're trying to create. And what is the vision of this and what is this new customer experience and how is the world changing and why does this relevant and kind of getting people excited about it?
And that was what was really amazing about this experience. I spent the next kind of three years building this. It became a $50 million a year profit center for the company. It was recognized on Oprah as one of her innovative ideas of the year. And it was just an exercise for me in like, you don't need to have authority to actually be a leader. You can lead via influence. You probably see that in your own sections here at school that there are people that kind of influence the climate of and the culture of that environment. Like that kind of leadership, like influential leadership. Especially when it's positive. Influential leadership is the most powerful thing you can do. Because within any company, like in most cases, you're not going to have full authority. You're going to have authority over some portion of the organization.
But what you really need in order to kind of build something and get an idea, from idea to actually execution is you need influence. And so that's what I really picked up there. You learn to influence people as a 22 year old. And I also love that story because it highlights that you've always had your pulse on predicting societal shifts and trends, whether that be the experience economy or the sharing economy. And in 2008, you go back to Harvard for business school and that's when your idea for a closet in the cloud was born. This idea was also revolutionary at the time, just to give a bit of context, the first iPhone had only been invented a year prior, and it would be years before the likes of sharing economy companies like Airbnb and Uber took off.
Jen, how did you come up with such an innovative idea? I think that all great ideas come out of sometimes personal experiences, which is what this did. The first inception of the idea was, you know, my sister. I was home for Thanksgiving break in New York City. My sister had just bought a really expensive dress at a department store called Bergdorf. It put her into credit card debt. I'm her older sister. I'm staring at a closet that's filled with designer dresses and I'm like, becky, return the effing dress. Like, wear something you already have. And she said, I can't. My closet's dead to me. I've Been photographed. The photos are up on Facebook. I need to wear something new.
And that was really a light bulb. That. Number one, what she cared about was the experience of walking into the room and feeling awesome. She didn't actually care about this physical asset of the dress. And number two, she thought this closet that was probably her biggest investment at that time was all dead. And I started thinking about, like, the closet actually is dead. It's this thing that's a historical museum of who you were in the past. And the idea was, what if the closet were alive and it could actually change with you as your life changed and your size changed and your mood changed and you had the freedom to actually express yourself based on how you felt today and who you wanted to be today. And that was really the idea for the closet in the Cloud, and this idea of having access to whatever you wanted to wear without having to own it.
But then I started to think about, okay, well, this could be a good idea. It could not. Does this already exist? Because often even disruptive ideas like, they already exist, it just takes a change of how you're thinking about the situation to understand, does this exist? And I started thinking about, like, does this idea of renting clothes or not having clothes forever, does it exist? And I resolved, not only does it exist, but this is like 85% of how we already shop. It's called fast fashion. Whenever you walk into a store and buy something, knowing that you're going to wear it once, twice, three times, and then push it to the back of your closet, you're renting it.
We've actually, all over the last 40 years, kind of grown up on this idea that it's okay to buy things that you're not going to use forever. And you end up just discarding them at some point, or, you know, pushing them, storing them at some point, that is a very new concept. Like, no matter where you are from around the world, think about your own parents and how insane it would have been, regardless of their economic class, to have purchased 85% of the wardrobe that they have, knowing that that stuff was actually going to disintegrate after they put it in a washing machine two or three times, which is what happens when you buy things at Shein or Zara or H and M. And so I thought, we're already primed to rent clothes, and now all I have to do is come up with a more tech forward, personalized, easier, more luxurious way to do it at the same price point as fast fashion, but give access to the real thing.
So that was also what gave me confidence that the market already exists and we could just create a better kind of solution for how people are already accessing variety in their wardrobe. You have this innovative idea, and you've mentioned that there are a lot of steps that you have to tackle in order to actually get it off the ground. And one of the biggest questions you have is how to get designer brands on board. I'm curious what steps you took in those early days to convince brands, especially given you had no previous background working in the fashion industry. So I had this idea on a Saturday night. I got back to campus on Monday. I had lunch with my friend, and I always was sharing kind of my harebrained ideas with her.
She listened to this one, and she was like, that sounds like fun. Who do you think we should ask whether this is a good idea? And I said, you know, I think that we should ask Diane von Furstenberg. And my co founder was like, do you know Diane von Furstenberg? He was like, no, obviously I don't. But, like, we could probably figure out how to get in touch with her. And that afternoon, we wrote an email to a million different iterations of dvfvf.com and we figured one of those email addresses would work. And someone in her office wrote back, like, I'll see you tomorrow at 5pm and so at Tuesday, I had the idea. Saturday night, Tuesday at 5pm I was with DVF, introducing myself as the co founder of Rent the Runway. And I was kind of pitching her on this new idea where we would, you know, get her inventory current season, rent it out to customers.
And what did she think about it? And she hated this idea. Hated the idea. She thought that she's like, why would I ever do this? Like, you're going to cannibalize my entire business. Who would ever rent when they. Who would ever buy when they could rent? And as opposed to what most people do in that situation, which is someone who's very powerful and very cool and very famous, telling you, like, your idea sucks and, like, why are you even here? Most people would kind of be stopped in their tracks. Like, I was like, okay, let me figure out all the reasons why she hates this idea, and then I can use that to actually modify the idea and change the business.
I mean, the business was three days old, so it wasn't really a business. But, like, I learned from her that her number one challenge, and it was the challenge of all designers, was customer acquisition. That because of fast fashion, younger women and men were not trying designer brands in the same way they were before. Couple that with the fact that younger people were not entering physical retail stores in the same way they were before. So it was harder for her. And paid marketing costs were extremely high. So it was really hard for her to acquire new customers. And so by the end of what became. She wanted to end the meeting after five minutes. We ended up spending an hour and a half with her in her office.
At the end of this hour and a half, she was, like, laying down on a couch, eating grapes, tossing her hair. I was like, is this a date or is this a. I don't know what was happening, but it was amazing. And I also learned that if I could create a business that helped her reach and develop brand affinity with the next generation of consumers, like, that, we might have something that she would want to partner with us on. And that's kind of what she said. She said, come back to me and I will meet with you again and talk about that. Now, also in that meeting, I asked her, hey, could you introduce me to a few of your friends? And I'd love to meet with them and talk about this idea, because every meeting has to get you to, like, three other meetings. And so never leave a meeting with someone without asking them for that introduction.
Now, those other meetings led us to other people in the fashion industry, some of which were designers, some of which were publicists, but people that actually could give us real feedback on this idea, and people that could see that we were interested in listening. It was helping to build trust in an industry where we had no experience, where you go in and you actually allow someone else to give you feedback, like, how does that work? What ends up happening? In a situation where I sit with you and I ask you questions and I ask you for your advice, you end up walking out of that conversation feeling awesome. You end up liking me in that conversation. Like, whenever you make someone else into the expert, that builds a relationship right away. And we needed desperately at the beginning of the business to build trust so that anyone would actually trust us to take their currencies and inventory and not cannibalize their business.
So that was just a really incredible experience. DVF continues to be an amazing friend of mine and of the business today. A huge supporter is someone who, like, while the initial reaction was like, this is not going to work, like, she was actually one of the first brands who signed on and, you know, has just been incredible along the way, that's a pretty amazing lesson on the power of listening and its ability to transform someone who once viewed you as a competitor into what sounds like a powerful teammate today. Now that you have brands on board, how did you go about transforming consumer? Well, getting brands on board took years. Let me be clear. Like, we launched this company with like, 20 brands. Most of those brands were on the verge of bankruptcy. And that's the only reason why they wanted to meet with me, why they wanted to work with us, because we wrote them a check with our VC dollars. And then it took me years to amass the close to 1000 brands that we work with today.
Now, over this period of time, I have 100% retention of those brand relationships. So even though it might have taken me eight years in some cases or 10 years in some cases to sign on a brand, once they start working with me, they see the value that we're bringing to them as a partner. And that's really, really important. And that creates positive word of mouth, like, positive net promoter score in your brand value proposition, in addition to net promoter score in your consumer value proposition. But I think that, like, if you're an entrepreneur, effectively, you are a salesperson. That's your number one skill that you need to have. And when I was going to certain brands, you know, they would be way harsher than what DVF said. You know, they're the head of one of the biggest luxury brands in the world in the US Told me, hell will burn over. Before I work with Rent the Runway. He said this to me. He was sitting closer than you are to me. He was like, screaming. His face was red.
And my reaction was like, thank you so much for the feedback. I'll come in, I'll come back in three months and, like, update you on our progress. And by the way, he's one of our biggest partners today, and he forgot that this happened. Like, if you ask him about this story, he was like, he thinks I'm making it up. I'm like, no, there were eight other people in the room. Like, you actually said this. Another head of another luxury band threw his cell phone at me. Like, he was so angry with me that he threw his phone at me. He's like, we're never going to do this. So you have to just almost also delight in the craziness of the experience that most people are not going to love your idea init, and sometimes they're not loving your idea for the right reasons. You can use what they object to as ways that you can actually innovate and modify.
Don't use their negative reaction as saying, well, they're wrong. Had we not listened to DVF and actually modified what the value proposition was going to be for brands, we never would have gotten the business off the ground. Did your pitch to brands and all the lessons learned through that inform how you decided to pitch to customers and convince them to join the platform? No, I don't think that the brand value proposition in our business, like, was really related to the consumer value proposition. I think that we have always been focused on trying to create a, you know, incredible experience that women would feel comfortable sharing with their friends or anyone who complimented them on their outfit. They would say, oh, thanks, I've rented the Runway, as opposed to saying, oh, yeah, thanks, I'm wearing Tory Burch, or thank you, I'm wearing Philip Lim. Imagine how impossible and expensive it would have been for me had someone only said, I'm wearing Tory Burch or I'm wearing Philip Lim. So I needed someone to be so enamored with the experience, having felt so great by this kind of Cinderella moment that Rent the Runway was offering them that they wanted to share the experience.
And to this day, 80% of our customers come to us via word of mouth. Our business is one that has never really had to rely on paid marketing. And my belief set is that the only way that you can grow a business over time is by improving the value that you deliver to the customer quarter over quarter. Like, the customer has to feel that the experience is getting better and better and that you are investing in her. In those early days, too, I can imagine that some customers were maybe hesitant to rent clothes that others had worn before. So how did you go about transforming consumer behavior to enable customers to not only accept, but desire wearing clothes that others had worn? Yeah. So in 2008, like, and 2009, when we launched, it was actually considered absolutely disgusting to wear clothes that other people had worn before. And so it was really only kind of a first adopter sort of community that would even give us a chance. And the fact that we had really aspirational brands that people couldn't otherwise afford was something that, like, even if they thought it was a little discounted, they're like, but I'm getting this $2,000 dress for, like, $100 rental.
Like, I'll give it a try. And so part of what enabled us to kind of get consumers on board was one, remember, the initial idea was for this closet in the cloud and having a wardrobe that was on rotation. And I recognized early on that that idea was too big for where we were in 2008, 2009, that if I pitch this idea of like renting clothes 100 days of the year, which is kind of how the consumer uses the product today, like people would think that that was insane and the business would have failed. So we started with a consumer value proposition that was really easy for people to get their arms around, which is rent a dress for a special event. You know that you're going to be asked to be a bridesmaid, or to go to a black tie party, or to go to a wedding and you're going to buy something that you're only going to wear once or twice. So it doesn't make sense for you to buy that dress. So every woman understood that about the value proposition and therefore we were able to kind of get her on board.
Second was make it a luxury experience. So every aspect of the experience felt luxury, from the photography to the way that the site looked, to the packaging, to the customer service experience. Because the trick of what created so much brand love is like you were getting a luxury experience, you were getting thousands of dollars in value, but you were getting it at a fast fashion price point. So that was really the magic of the experience. So invest in every aspect of the end to end experience and make it feel luxurious. And the third aspect was kind of hustle and utilize our own story as founders kind of put ourself front and center to try to get as much earned media as humanly possible around this concept to get people on board. And one of the craziest things that we did that really exemplifies Rent the Runway culture is we were like, we need to be in the New York Times because they have a lot of traffic and if people read the New York Times, then they'll find out about Rent the Runway. And we literally had not launched the business and I thought about, okay, how do we get into the New York Times? And I thought, okay, well, we're two women and we're kind of starting a tech company. So they don't. There's really, at the time, there were no women starting tech companies. Like, let's try to find a technology reporter because we're going to be interesting to them.
We then scoured this whole list of email addresses that we had kind of created over the summer, trolling through people's alumni databases. And we saw that there was someone who was like a 22 year old tech reporter at the New York Times. She had anyorktimes email address. And I was like, let's get a meeting with her. Let's invite her to this office for coffee. And so we invited her. We kind of shared this whole vision of what we were doing. We were going to revolutionize the fashion industry, et cetera. She needed a story because she was 22. She wanted to write her own piece. We needed her. And she's like, okay, I'm going to write an article. And then the second challenge was, okay, well, I didn't want it to be buried in the technology section because then no one was going to read it. So I was like, can you come take photos of our warehouse? And do you want to take photos of us? And she was like, we'll take photos of your warehouse. But like, no, you don't need to be in the picture.
I was like, oh, well, when's the photographer going to show up? And she told me when the photographer was going to show up. I told my co founder. I was like, let's put on our sexiest dresses right now. Let's go to the warehouse. Let's run there. Let's stand on ladders. Let's be in front of the warehouse. And we did it. And we posed in these ridiculous dresses, in this ridiculous fashion in front of, like, a row of dresses. And that photo ended up on the front page of the New York Times. A1 section on newyorktimes.com, we had 100,000 people sign up day one of Rent the Runway. And we met our first year sales productions in the first three weeks. And so, like, press begets press number one, but number two is like, create your own luck. Like, this woman was effectively, like, no way. You're not going to be in the photo. And who knows if they're even going to use the photo.
I'm like, I'm going to create the story. And so that sort of like creating the story and hustling for it is, first of all, what makes entrepreneurship fun. But second, like, something that I hope is still embedded in our culture, you know, 15 years later. That's amazing. I'm definitely hearing a theme in all of your experiences of you being scrappy and being the ultimate hustler, which I think is a good lesson for all the aspiring entrepreneurs out there. I want to pivot now and talk a bit about your experience raising money. So you're obviously operating a very inventory heavy business which requires a lot of capital. Can you talk a bit about your journey? Raising money from a predominantly male VC industry, convincing them to invest in a business catering exclusively to women. So raising money, it was something that I found to be very fun.
Because I love painting the picture of what we were doing, how we were going to disrupt the industry, what the trends were that were kind of leading to this point where Rent the Runway could be a viable business. And it didn't dawn on me until, like, many years into the business how bleak it was for female entrepreneurs to be able to raise money. So a lot of the early experiences that we had where people were kind of rejecting us, I just thought, like, they were rejecting us because, you know, the idea wasn't right for them or, you know, they just didn't like the idea. I didn't actually think that it had anything to do with gender. Now, if you look at the data, like, there's a lot that has to do with gender in that the metrics around dollars going to women have been around 2% for the past 25 years, and they've only gotten worse. And those metrics are even worse as it relates to people of color, women of color, you know, anyone who comes from a different background. So I think that we had some interesting experiences at the beginning where I remember an early kind of seed round pitch we did.
Where we were pitching to two partners of a very kind of prestigious VC firm. And I know that I'm a great salesperson, pitcher. I had gotten great feedback on this pitch from others. And at the end of the presentation, like, he took my hand in his, one of the partners, and he was like, you're going to have such a fun closet of dresses to dress up with. This is going to be so fun for you. And, like, kind of treating me in this way of that. He thought that this was just like some cute girl and some cute idea. And I think that that really has, like, driven me to want to just prove people like that wrong and that the only recipe is just continuing to move forward. Like, there's going to be people like that. There's nothing that I can do to change that guy. All I can do is like, go pitch more, raise more money, build my business, try to make that business successful, and just continue to, like, put one foot in front of the other.
So I think we have. I think that there aren't that many solutions to this problem except ensure that my business can be as successful as possible so that when other women are trying to raise money, that they have the pattern recognition of, like, well, there are these other women who have been able to do it. Well, you did impressively raise over $400 million in VC funding. And with that capital, you're able to grow the business. And in growing the business. You had the best months in Rent the Runway history in January and February of 2020 up until that point. And then, obviously, Covid hits, and women are no longer leaving the house.
How did Rent the Runway change as a result of COVID And how do you now think about navigating turbulent times? So I had been building Rent the Runway for 13 years when Covid hit. And first of all, Rent the Runway is my first child, like, the love of my life. I build this company because I actually do want to change the way that people feel about themselves every day. I love my team, and there have been thousands of people over time that have been contributing to this big vision and this big idea that we have and have put in their blood, sweat, and tears into taking this from, like, what was a very crazy, disruptive idea into really pioneering a category.
So we had had this incredible few months prior to the pandemic, or many years prior to the pandemic. We had launched a subscription to fashion, which was growing like crazy. So the vision of the closet in the cloud was actually coming to fruition. People were using this to get dressed 80 to 100 days of the year. They were renting the Runway for their everyday life. And then on March 12, 2020, we lost, like, 80% of our revenue overnight. And we clearly, like, there's really not a use case for variety in your wardrobe, which is what Rent the Runway is about. If you are on your couch, like, there's really nothing that you can do to kind of drum up demand. And initially, I didn't want to accept that. And I spent the first few weeks trying to, like, drum up marketing ideas with my team of, like, how are we going to bring customers back? What are we going to do?
And there was a moment where, like, I was on Zoom and my husband kind of came into the room after I had, like, signed off a Zoom call. And he's been like. And he was like, jen, you run this company, and you've been in the same pajamas for the last two months. No one is going to rent clothes right now. Like, stop thinking about this and save the company. And I think that the first lesson is, like, when you're in any crisis, you have to ground yourself in reality. And grounding yourself in reality is often a very difficult and harsh thing to do. And it's especially a harsh thing to do when you're leading a team of thousands of people. And at the same time that I was trying to ground the team in the reality that, like, this is going to be really bad. For us for a long period of time, I had to inspire the team with hope that there was a reason to still believe, there was a reason to still believe in our vision, that our vision actually was going to serve the post Covid world even more, even better, and that we can use this period of time when essentially our revenue had kind of moved away, to transform and innovate the business in ways that we may not have been able to, when there were all of these orders kind of coming through the site, all of these orders coming through the warehouse, et cetera.
So it was a absolutely horrific period of time on one hand, because I felt like the huge amount of emotional stress that I needed to save the company, not just for myself, I needed to save the company for the thousands of people who had believed in me, who had dedicated their time over many years in helping to create this company. And it deserved to exist. And so we had to. I had to basically become the most decisive version of myself. And every single day I would make dozens, if not hundreds of decisions. It's very clarifying to be in that situation in some senses, because you realize, like, what is your core business? What do you think it's going to be when you come out of COVID And like, what do you. You need to slice away a lot of the business right now. We needed to let go of hundreds of people, which was incredibly difficult. We needed to let go of lots of different work streams and divisions of the company.
We had to simplify the business. And those times of crisis, in a sense, there was like deep clarity around what is the simplest version of what this product needs to be and how do we actually get really laser focused on. Here's the three things that we're going to do over this period of time that are going to help the business transform so that when we emerge from COVID we can emerge as a fundamentally different and stronger business than we were before. That's amazing that you were able to keep the business afloat during that time and you impressively go public in 2021. Fast forward to today, nearly 15 years after your founding, after you've pioneered a new way to shop, the market is now not only full of other clothing rental platforms, but also resale players.
How do you think about differentiation given the market? So, first of all, I'm really proud that there is a circular fashion market right now that we were a part of pioneering. And that circular fashion market is global and it's enormous and it's growing. And I see that the market, no. 1 consumer is going to just have one modality for how they think about clothing, how they think about their wardrobes. If you think about most industries on earth, you're offered a choice as a consumer for how you want to consume in that industry based on what your need or your use case is. So in the world of transportation, you can own a car at the same time, if you're going from point A to point B, you could decide you want to take an Uber. If you are going on a seven or 14 day business trip, you can rent a car for that period of time.
There's different options for you to get from point A to point B. In fashion, before Rent the Runway, you had one option which was buy something and own it forever. And so what I see Rent the Runway is doing is we're really owning kind of that last mile in the same way that Uber is helping you get from point A to point B. Anything that you want to kind of utilize in your wardrobe for like three months or less, you should have it as part of your subscription. Like this dress. I might want to wear it a few times and then I'll send it back, I'll get something new that should be part of your rental rotation. What is resale?
Resale is a leasing model. Okay? Like, resale is if you want a new bag every year, you want to keep that bag for a year and then flip it out. Like that makes sense to utilize resale because it's a long term leasing model. And then ownership should be something where you invest and you have those things forever. They should be very high utility items that you get a lot of use. So you should own an amazing black blazer.
You should own amazing cashmere sweaters. Like the closet should exist with all of these options. And the consumer, when given a choice, I think now, can rethink how she spends her money and actually have the freedom to think about those items that with rental as an option, you have the freedom to express yourself in a way that you didn't really have before. And you can kind of wear something that's a new color or a new trend and have fun with it without having that burden of knowing you have to own it forever.
So I see resell as being incredibly complementary to what we do. I see the fact that there are other now real competitors that we have in the rental space, in the subscription space as being amazing. It is unbelievably difficult to create an industry, explain how this whole thing works, get you to use it as a consumer, improve continuously, market this new industry. If there are competitors who are also marketing this idea of subscribe to fashion, all we have to be is the best. All we have to do is own who our market is and own who our consumer is. And because I think that this is such an enormous market, Fashion is a $300 billion market just in the U.S. it's a two and a half trillion dollar market globally. And I personally think that because 80% of the closet is worn three times or less, that there is a huge amount of the closet in the future that can actually move to this idea of a closet in the cloud.
It also seems to me like in this crowded market, one of your main differentiators too is your reliance on data. I think many people may view Rent the Runway as solely a fashion company, but in reality, you are a massive tech and logistics operation that has figured out how to expertly use data to understand consumer behavior. Can you give us just a few examples of how you use data? Yeah, but you kind of skipped over, like a really crazy part of the story, which is like, the business died, right? Like, we had no revenue and we were then innovating, and I had to raise like, vulture capital to keep the business alive, which was an insane experience.
And then a year and a half later, we IPO'd the business, and it was the most incredible experience that I have ever had in my life. To IPO something and see thousands of alumni of Rent the Runway and employees of Rent the Runway come back to New York during COVID to celebrate this and the number of people who were able at that point, when you're kind of a boss or you're a leader, someone works for you, and when they leave Rent the Runway, you don't really know or you don't really hear what impact Rent the Runway has had or not had on their life.
And the IPO was this unbelievable experience where, like, I heard from thousands of employees that, like, this experience working at Rent the Runway had transformed who they were and transformed their life and had made them dream bigger for their own lives. And they had now become their own entrepreneurs, or they had met their own co founders, or they had taken big jobs somewhere else. And I think that there are those moments in a business career that are harrowing, like managing through crisis and managing through a pandemic. And then there are these moments that are so incredibly special where you realize that you're making even a small impact on how people feel about themselves and on their lives. And you kind of have to treasure those incredible moments of celebration as the fuel to Kind of keep you going and enable you to kind of keep on putting one foot in front of the other.
So I just wanted to go back to that ipo, because it was, like, unbelievable that we were able to do that. And thank God we IPO'd when we did, because a week later, the market crashed and we never would have been able to go public, and the business would have gone bankrupt at that point, because we needed that capital that we raised in the IPO to bring the business to profitability. And so that was just a really miraculous period of time that I'm extremely grateful for. And the team that kind of stayed so committed to this vision. It is the most special thing in life to not only have your own passion and your own vision and conviction for something, but when you see that other people take that on as their own and when other people act like real founders in your business and in your idea and that we've done this together, like, that is the most special experience of my life, that it wasn't about me taking the company public.
Everyone who was there felt like they took the company public, that they built the company. And that's what I kind of wish for you, all of you in the room, that, like, you are able to build something and have a career where you feel like you've done something with a group where, like, you're part of a community that's changed, you know, the world in some way.
Because that feeling of doing something together is, like, the most incredible feeling in the world. That's amazing. And thank you so much for digging in deeper there. But we can go back to data if we want. We can talk about that, but in the interest of time, I want to open it up to audience Q and A. There are so many other parts of your story that are interesting and that. Wait, no, I want to talk about one other thing first. Ok, we can also do that, too. Ok. I want to talk about this concept of View from the Top and how challenged I was to kind of think about myself even giving this conversation today. Because by no means do I think that I'm at the top.
And I don't even use that as a parameter for how I want to think about my life. Like, what does being at the top mean? Like, I have achieved incredible career success, but I still think I'm at the very beginning of what I want to build and innovate and create for Rent the Runway. I want this business to be really sustainable. I view that so much of my life and what is going to make me Happy. And what does make me happy has nothing to do with a successful career. It has to do with the fact that I have a wonderful marriage and I have kids who I love and I have incredible friendships and I invest in those friendships. And sometimes I. You know, now that I've watched like 12 of these talks over the past two days, I've seen that there are a lot of, like, you know, luminary people and they come here and they talk about like, their career success and like, give this notion that what we're trying to achieve is being at the top.
But it's like, if we all think about our lives that way of trying to get to some destination, you're not going to be happy. Like, the life is about the journey. The thing that I'm proud of about Rent the Runway is the everyday moments over the past 15 years where I've just had the time of my life. Like, who really cares? What does being at the top mean? Does that mean an extra X million dollars in the bank? Like, what is that really going to bring to me? So I think that we should just all think about, like, the goal is the journey and enjoying it. The goal is like, what is optimized around making you happy. And for some of you, that's going to be very career related, but for many of you it might not be, and that is totally okay.
And part of what you should be doing here is figuring out, like, what fundamentally about you is going to make you happy. Like, the realization for me going back to my childhood is that it's community that makes me happy. And so, like, entrepreneurship is just my way to like, pay people to be around me all day long. Right? Like, so I built my own community and like, that makes me really happy. And I've built other communities of my family and friends, et cetera. But like, I just don't think that many of the people that I used to when I was in business school and I looked up and I said, well, they've created a multi billion dollar company, they're sitting here, they're a billionaire, they're successful. It's like, if you really talk to a lot of those people, like, that's not how they measure even themselves.
Like, there are so many aspects of your life that are, you can achieve all of this career success, and if you don't have the other things in your life that you really care about, like, it's really not going to be that meaningful. So we have to focus on, like, the whole picture. I appreciate you saying that because there are so many MBA2s in the audience who are about to graduate. So thank you. Jen. Thanks so much for being here and sharing your story and I particularly loved the elements of hustle that you shared throughout your story. A lot of the women in my life love Rent the Runway. That's awesome. I was curious if Rent the Runway could work for men and why or why not? I think that there's definitely more of a market for men today than when we founded the business. Men are becoming more and more interested in fashion, but I think that great businesses stay focused and we can do so much more for our female customer that we have today.
We're just scratching the surface on the customer experience and I think that it would actually be detract an enormous amount from the experience to start to focus on an entirely different customer set right now who has different needs, who thinks about the product in a completely different way. So even 15 years into the business, interestingly, like, I think that we still have a massive, massive opportunity ahead of us and the goal is like continue to stay focused on it.
It's view from the chop tradition for us to end with a quick lightning round. Okay. If that sounds okay to you. Great. Okay. Great. Dream job. When you were a kid being a pop star, awesome. It's not too late for that. Oh, I'm working on it. Advice you would tell your younger self a lot. This is a big one. Real advice is do not stress so much about getting married. You'll get married, you'll find the love of your life. Like it'll happen. Like, don't let it paralyze you. That's great. Most fun piece of clothing you've rented. I rent clothes about 350 days of the year for the last 14 years. So there is a lot. Well, I'll just tell you one. Last weekend I dressed up with my daughter as we were both Harry Styles. I wore a silver sequin structure jumpsuit that looks exactly like Harry Styles. She had her own matching one and we sang with a band in front of her birthday party.
So that was just really fun about like using Rent the Runway to, you know, do something crazy and wear something. That's certainly a one time thing. That's amazing. And finally, an atypical view from the top Lightning round question, but is there any discount you can give to your GSB fans out there? I think we have something for all of you guys. Thank you so much. What is it? Well, hopefully a promo code. Oh, it is. We have a promo code. We want everyone here to have a subscription, and we're giving it to all the men, too. So give it to any woman in your life that you want. And thank you guys so much for having me here today. Thank you so much, James.
Innovation, Entrepreneurship, Leadership, Fashion Industry, Disruptive Business Models, Community Building, Stanford Graduate School Of Business
