The Hustle

Clothing rental is here to stay…

Today, kids can’t stay off phones in school and Le Tote bets that renting and not buying will stay cool, but first…

Fashion startup Le Tote acquires iconic department store chain Lord & Taylor

Le Tote just picked up Lord & Taylor during a $75m shopping spree, and the fashion world is shook.

Umm, I don’t speak fashion

Le Tote is a fashion rental subscription service…  basically, people pay to borrow clothes. Launched in 2012, the startup was recently valued at $180m.

L&T, on the other hand, is an iconic department store. Founded in 1826 and owned by Hudson’s Bay Company, it’s known for high-end fashion and — fun fact — introduced the personal shopper concept. Last year, L&T saw sales of $1.1B.

So… shouldn’t L&T have purchased Le Tote?

Hudson’s Bay Company has been losing money since 2016 and announced earlier this year it was mulling culling L&T.

Enter Le Tote … and an interesting deal. In exchange for L&T, Hudson’s Bay will get a bit of cash plus an equity position in Le Tote Inc. Hudson’s Bay also agreed to pay about $58m in annual rent on the Lord & Taylor stores that are leased for at least the next three years. 

Le Tote plans to keep the stores open and staff employed. Meanwhile, it will have to raise additional capital to complete the transaction.

Fashion is weird

Established names like L&T struggle to attract capital because traditional retail has an uncertain future. 

But new concepts — like clothing rental services — generate buzz, and that’s attractive to investors. The clothing rental market is estimated at $1B and is predicted to hit $2.5B by 2023. 

And Le Tote and L&T might not be a clashing combo. Consider this: An expensive designer dress that doesn’t sell quickly in a store gets marked down — that’s lost margins. But sending that dress into the rental cycle allows more shoppers to wear it … and pay the full price of the dress.

That was a clothes call

Kids can’t stay off their phones, and Yondr is reaping the benefits

What was the world like before smartphones? Definitely don’t ask a teenager. Chances are they have no idea.

A report from Pew Research Center shows that 95% of all teens currently have access to or own a smartphone, and 45% are online pretty much 24/7.

Phone addiction has pushed many schools to enforce policies regulating usage during school hours. But, as we all know, it takes a little more than the iron fist of Miss Trunchbull to get kids to look up from their phones — and recently, schools have decided to explore more drastic measures.

This year, The Guardian reports, more than 1k schools nationwide will be using Yondr, a magnetized pouch system that locks students away from their phones while class is in sesh.

Schoooools back… from… summer 

Musicians and standup comics have used Yondr to keep people present at their gigs since the San Francisco-based company launched in 2014.

But, in recent years, more and more schools have used the pouches to lock out students during school hours. And, while reviews are mixed — from students and teachers alike — there’s proof that it works.

Of course, kids aren’t going to give up easily

Some schools using Yondr have seen a decrease in phone use and an increase in person to person connectivity. 

Yet, students, the rascals that they are, have also figured out ways to hack the pouch.

Still, according to Yondr spokeswoman Kelly Taylor, “Demand has tripled this year.”

Lock it up
Things you should…

SPARE: Your keyboard (and its feelings), $15

Sure, hitting things is cathartic, but bringing your smashed laptop to IT is one awkward conversation we’re tired of having. Our solution: This huge, plush “Enter” key, which allows you to smack with aplomb.

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If you’re gonna be stuck at work five days a week, you may as well be comfy. Pick up a Herman Miller chair and turn your deeply distressing desk into chill central. Get 15% off all work designs (like their Low-Back Cosm Chair) and free shipping when you order by September 3rd.

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Investors are buying stock in old comics and Pokemon cards

Most of us probably know a 11-year-old who blew their whole allowance on a pack of Pokemon cards back in the day… but blowing stacks of cash on Pokemon cards isn’t just for pre-teens anymore.

In recent years, fractional investment — which enables numerous investors to buy a stake in the same asset — has become more popular. 

Several startups offer marketplaces that allow people to invest a few bucks in partial ownership of everything from Star Wars collectibles to sneakers.

Alternative asset marketplaces are growing fast

Last week, one startup called Mythic Markets raised $2m to expand its marketplace for rare collectibles (for just $45, investors can purchase a piece of a Magic: The Gathering card that’s worth $90k). 

But Mythic Markets is just one of several startups specializing in fractional ownership of collectibles.

A startup called Otis offers investments in museums, albums, sneakers, and comic books starting at just $25, and other startups offer fractional ownership of everything from cars to homes.

So, are these investments as risky as they seem? 

Actually, no: Mythic Markets, Otis, and most fractional investment startups only offer securities that are backed by the SEC — and the SEC backs comic books, sci-fi trinkets, and even e-sports teams.

If you’re wondering where in the name of Charizard fractional investing came from: It all started with vacation-style timeshares…

Maybe you and your Uncle Jerry are pretty similar, after all.

Bullish on Pikachu

Women are leading the sex toy revolution

For decades, men dominated the sex toy industry — and it showed. Vibrators and other accessories were regarded as forbidden vices and sold at seedy sex stores. 

Now women are taking control. Although 70% of sex toy companies are still owned by men, the vast majority of startups are fronted by women who are shifting the perception of sex toys from vice to wellness. 

Investors have followed 

The sex toy industry is valued at $30B, with the vibrator market taking up a $6B chunk. Companies like Dame, Crave and Unbound have used smart features like bluetooth to data-gathering technology to create state-of-the-art equipment.  

They have raised millions from investors and crowdsourcing. The fund Intimate Capital invests purely in sexual wellness companies, striking a difference from conservative funds that have traditionally bypassed the market. 

“My investment in sextech shouldn’t be viewed any differently than investments in other types of healthcare,” says Laura Behrens Wu, an angel investor. 

Progress is still needed 

But as The Hustle has revealed in earlier reporting, stodgy corporations, social media publishers and even supposed Silicon Valley rule-breakers have not caught up. CES rescinded an award given to the wellness company Lora DiCarlo’s cutting-edge vibrator earlier this year. 

And this week the company Lioness was asked to remove its vibrator from a tech event hosted by Samsung, despite Samsung’s earlier approval of the product. 

On Facebook, Viagra is seen as a health product and can be advertised, but lubricants for pre-menopausal women cannot. Dame and Unbound have partnered in a campaign with the goal of showing how these regulations discriminate against women.

The Future is Female Pleasure →  

The previous story was adapted from a Trends report by The Hustle. Check out the full story here.

UPDATE: Samsung apologizes to Lioness… kinda

On Tuesday, we reported that the co-founder and CEO of female sexual health company Lioness (creator of the world’s first smart vibrator) was asked to remove her product from a “women in tech” event co-hosted by Samsung.

Nearly a week later, the electronics giant told the Verge that it was wrong to ask the CEO of Lioness to do so. But Samsung’s medium-size apology left the team at Lioness anything but satisfied.

Here’s Liz Klinger’s statement

(This statement was lightly edited for length)

As far as I know, we haven’t received the apology either directly or through intermediaries. But the apology is almost besides the point.

[The statement] basically says they don’t intend to change anything and this is just intended to dismiss what occurred, which is disappointing.

Samsung, like many of the big tech companies and organizations, is a gatekeeper with enormous power to shape the landscape of who is included in the broader conversations — or not.

Based on this statement, it seems like they would still exclude these voices. 

Despite their secondhand apology, if you take into account that they haven’t reached out to us (or the founder of FemTech Collective who invited us and spoke on their panel), does it seem likely we or any other company in female sexual wellness will ever be included in their events again? Or (not to be too cynical about it), did they simply learn to exclude/filter these companies ahead of time? 

What we’d hope for isn’t anything huge, just a basic commitment of greater inclusion and concrete steps to achieve it.

Co-founder, CEO


Hear Lioness roar

These Swiss mad scientists designed a shoe that can handle meetings and marathons

Crazy things are happening in Zurich… 

The folks at On HQ are channeling their inner Dr. Frankenstein and giving birth to something truly shocking: 

A shoe that can do it all.

The On Cloudswift blends the best bits of all sorts of footwear — office shoes, marathon sneaks, and casual kicks — and turns it into something greater than the sum of its parts. 

Lightweight enough to rock for a run, comfy enough to wear through a workday, and stylish enough to pass muster at a casual wedding… it might just be mankind’s greatest invention yet. 

Not sold? We’ll sweeten the deal: Readers of The Hustle get a free On Comfort-T (AKA the type of t-shirt a runner’s dreams are made of) on purchases over $150.

Try some On
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