Rent the Runway is an online service that provides designer dress and accessory rentals. Rent the Runway was started by Jennifer Hyman and Jennifer Fleiss, who met at Harvard Business School and launched the company in November 2009. Initially a purely e-commerce company, it later opened brick-and-mortar retail locations in New York City, Chicago, Washington, D.C., San Francisco, and Los Angeles.
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History
In 2008, Hyman and Fleiss met as sectionmates at Harvard Business School. They regularly met up to discuss entrepreneurial ideas, one of which was Rent the Runway. Hyman thought of the idea after witnessing her sister spend thousands of dollars on a new designer dress to wear to a wedding, despite already owning several designer dresses, because she did not want to be seen in a dress she had already worn, especially after photos of her wearing those dresses had been posted to social media. Hyman and Fleiss knew the concept had the potential to contribute to the "access economy" along with companies like Netflix and Spotify, which favor access over ownership, and decided to test it out with consumers. They pitched the idea to designers and potential investors without writing a business plan, instead deciding that testing and iterating on their concept was more important than a formal plan. They launched www.renttherunway.com in November 2009.
The company has received approximately $126 million in venture capital from Bain Capital Ventures, Highland Capital, Kleiner Perkins Caufield & Byers, Condé Nast's parent company Advance Publications, American Express, and Novel TMT Ventures. As of October 2016, Rent the Runway has over 6 million members, 975 employees, and over 400 designer partners.
In 2015, the company suffered negative press after the departure of several executives such as CTO Camille Fournier and Linda Honan (now of BBDO). However, it was reported to have a positive bounce back by the end of 2016 with a Series E venture investment from Fidelity Investments and the launch of new physical retail shops.
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Business model
Customers can rent one of Rent the Runway's designer clothing for a 4- or 8-day period for as low as 10% of the retail price through their traditional platform called RTR Reserve. Rent the Runway carries apparel in sizes 0 to 22, depending on the designer. Each dress rental includes a back-up size at no additional cost to ensure fit. Customers can get a second dress style with their order for an additional $32.50. Rent the Runway provides customers with a pre-paid, pre-addressed package to return the dress, and offers a $5 insurance fee to protect against accidents. Rental prices include the dry cleaning and care of the garments.
In March of 2016 the company launched Unlimited, the first subscription to fashion that gives women access to designer clothes and accessories for a flat monthly fee. Through Unlimited customers select 4 pieces on the Rent the Runway site and can keep each item for as long as they want or swap any or all of them out for new selections. The subscription costs $159 per month and shipping, dry cleaning, and insurance are included.
In October 2017, Rent the Runway announced a new, lower-priced tier of membership called RTR Update. Customers select 4 pieces from Rent the Runway and keep them for a month. At the end of each month, subscribers are able to select four new items and return their previous items via mail. The subscription costs $89 per month and shipping, dry cleaning, and insurance are included.
Rent the Runway also rents accessories, including jewelry and handbags, and sells "essentials," including lingerie, tights, shapewear, and cosmetics.
Rent the Runway has physical locations in New York City, Washington, D.C., Chicago, San Francisco, and Los Angeles. Customers can visit any of Rent the Runway's five stores, work with a personal stylist, and either take items directly with them or book dresses and accessories for future events.
Awards and honors
The New York State Society for Human Resource Management honored Rent the Runway as one of the best companies to work for in New York State in 2014. In 2013, Rent the Runway was named one of the 50 companies disrupting the status-quo by CNBC, one of the 10 most innovative fashion companies by Fast Company in 2011, and one of the 50 best websites of 2010 by TIME magazine.
Rent the Runway CEO and Co-Founder Jennifer Hyman was named one of the "12 Most Disruptive Names in Business" in 2013 by Forbes and was included on Fortune's "Trailblazers" list of individuals changing the face of business in 2013. Both Hyman and co-founder Jennifer Fleiss have been named Inc. Magazine's "Top 30 Under 30," Fortune's "40 Under 40," Fast Company's "Most Influential Women in Technology," and Fashion Group International's 14th annual Rising Stars in Retail.
Rent the Runway founders Hyman and Fleiss were recognized by Forbes in 2016 as "Women Entrepreneurs to Watch" as well as "The Creatives" on the 2016 Upstart 100
References
Source of the article : Wikipedia
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