Rent the Runway becomes a fashion unicorn

Rent the Runway just raised $125m, making the clothing rental subscription company a new unicorn.

Subscription clothing rental startup Rent the Runway just locked in $125m, officially becoming a $1B company. Now, Runway plans to grow its subscription business, expand its clothing and home offerings, and open additional fulfillment facilities.

Rent the Runway becomes a fashion unicorn

In other words, the company plans to use the money not for anything specific, but merely to continue to exist.

Wear the same thing twice, you say?

In a time when fashion trends change before you can get the dang things off, many consumers (sure, “millennials”)  have taken a one-done-thank-you-hun approach to wearing clothes.

From 2003 to 2016, “garment utilization rates” — AKA the average number of days an item was rocked before it gets donated to Buffalo Exchange (we all know they NEVER actually buy anything) — decreased from 200 to about 120, one of the driving forces behind RtR’s success.

Unfortunately, it’s causing midrange retailers to wear the costs of overproduction and the uptick in returns — yep, it costs stores money when you wear sh*t and then return it a day later.

Oh, no, not another ‘Netflix for (X)’

Founded in 2009, Rent the Runway started out as a service that loaned designer dresses to women for special events at a sweet price.

Now, the company brings in well over $100m in revenue per year, and has become known as (barf) the “Netflix for dresses.” 

During its time, RtR has expanded from its bread and butter of one-time rentals to now three different offerings — including two subscription services.

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Topics: Clothing

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