Rent the Runway
{{Short description|Online service that provides designer dress and accessory rentals}}
{{Infobox website
| name = Rent the Runway
| logo = Rent the Runway logo.svg
| logo_size = 75px
| company_type = Public
| traded_as = {{NASDAQ|RENT}}
| location_city = New York City
| location_country = U.S.
| foundation = {{start date and age|2009}}
| founder = Jennifer Hyman
Jennifer Fleiss
| key_people = Jennifer Hyman (CEO)
| industry = E-commerce
| website = {{URL|renttherunway.com}}
| revenue = {{Increase}} $100 Million (2017){{Cite web|url=https://www.inc.com/magazine/201707/zoe-henry/jennifer-fleiss-rent-the-runway.html|title=Rent the Runway Had 6 Million Customers, $100 Million in Revenue. Then the Co-Founder Quit|first=Zoë|last=Henry|date=July 20, 2017|website=Inc.com}}
}}
Rent the Runway is an American e-commerce platform that allows users to rent, subscribe, or buy designer apparel and accessories. It was founded in November 2009 by Jennifer Hyman and Jennifer Fleiss and is based in New York City.
History
In 2007, Hyman and Fleiss met as sectionmates at Harvard Business School.{{cite magazine |last1=Schwartz |first1=Alexandra |title=Rent the Runway Wants to Lend You Your Look |url=https://www.newyorker.com/magazine/2018/10/22/rent-the-runway-wants-to-lend-you-your-look |access-date=8 June 2021 |magazine=The New Yorker |date=22 October 2018}} They regularly met up to discuss entrepreneurial ideas, one of which was Rent the Runway.Black, Tiffany, [http://www.inc.com/30under30/2010/profile-jennifer-hyman-jenny-fleiss-rent-the-runway.html “Jennifer Hyman and Jenny Fleiss, Founders of Rent the Runway”], Inc Magazine, July 19, 2010 After seeing her sister overspend on an expensive new dress for a wedding, Hyman had the idea of offering dress rentals for women for special events. Long term, her plan was to offer women unlimited access to a designer closet they could rent from on-demand.{{cite news |last1=Marikar |first1=Sheila |title=The Transformational Bliss of Borrowing Your Office Clothes |url=https://www.nytimes.com/2018/10/12/business/rent-the-runway-office-clothes.html |access-date=17 June 2021 |work=New York Times |date=12 October 2018}} Early on, Hyman and Fleiss pitched the idea to designer Diane von Fürstenberg as a rental service for her brand's website. She was initially uninterested, and suggested that instead they create their own multi-brand retail site. Hyman and Fleiss took her advice, and Fürstenberg signed on as one of the company's first designer partners.{{cite news |title=Rent The Runway: Jenn Hyman |url=https://www.npr.org/2017/09/21/541686055/rent-the-runway-jenn-hyman |access-date=8 June 2021 |publisher=NPR |date=7 August 2017}} A November 2009 article in The New York Times helped bring publicity to the company shortly after its launch.{{cite news |last1=Wortham |first1=Jenna |title=A Netflix Model for Haute Couture |url=https://www.nytimes.com/2009/11/09/technology/09runway.html |access-date=8 June 2021 |work=New York Times |date=8 November 2009}} In 2016, the company began offering everyday clothing through a subscription model.{{cite news |last1=Harris |first1=Ainsley |title=Rent The Runway Launches Unlimited Service |url=https://www.fastcompany.com/3057717/rent-the-runway-launches-unlimited-service |access-date=8 June 2021 |publisher=Fast Company |date=23 March 2016}}
The company has received over $400 million in venture capital from investors including Fidelity, Franklin Templeton, TCV, Bain Capital Ventures, Highland Capital Partners, American Express, and T. Rowe Capital.Rao, Lena, [https://techcrunch.com/2013/03/11/amex-conde-nast-back-the-netflix-for-designer-clothes-rent-the-runway/ "AmEx Backs The Netflix For Designer Clothes, Rent The Runway"], "TechCrunch", March 11, 2013{{cite news |last1=Roof |first1=Katie |title=Rent the Runway Raises $60 Million |url=https://techcrunch.com/2016/12/27/rent-the-runway-raises-60-million/ |access-date=17 June 2021 |publisher=TechCrunch |date=27 December 2016}}{{cite news |last1=Segran |first1=Elizabeth |title=Rent the Runway is now a unicorn |url=https://www.fastcompany.com/90323340/rent-the-runway-becomes-a-unicorn-after-new-125m-investment?ref=producthunt |access-date=17 June 2021 |publisher=Fast Company |date=21 March 2019}} In 2015, the company suffered negative press after the departure of several executives such as CTO Camille Fournier and Linda Honan (now of BBDO).Roberts, Daniel, [http://fortune.com/2015/11/17/rent-the-runway-exodus/ "Exclusive: What’s behind the exodus from Rent the Runway?"], "Fortune", Nov 17, 2015Kosoff, Maya, [http://www.businessinsider.com/executive-flight-at-rent-the-runway-2015-11 "Why executives are fleeing $500 million startup Rent the Runway"], "Business Insider", November 17, 2015 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.O'Connor, Clare, [https://www.forbes.com/sites/clareoconnor/2016/12/28/rent-the-runway-raises-60m-in-funding-as-it-rolls-out-retail-stores/#57f3ed68600a "Rent The Runway Raises $60M In Funding As It Rolls Out Retail Stores"]"Forbes", December 28, 2016{{Cite web|url=https://pitchbook.com/newsletter/rent-the-runway-pivots-away-from-rough-year|title=Rent the Runway pivots away from rough year | PitchBook|website=pitchbook.com}} In 2017, Fleiss left the company to co-found Jetblack, a concierge shopping service.{{cite news |last1=Belanger |first1=Lydia |title=Why the Entrepreneur Behind Rent the Runway Decided to Launch Her New Company Through Walmart's Incubator |url=https://www.entrepreneur.com/article/314307 |access-date=14 June 2021 |publisher=Entrepreneur |date=31 March 2018}} Fleiss remained on the board and Hyman remained as CEO.{{cite news |last1=O'Connor |first1=Clare |title=Rent The Runway Cofounder Fleiss Bows Out As Company Preps For IPO |url=https://www.forbes.com/sites/clareoconnor/2017/03/20/rent-the-runway-cofounder-fleiss-bows-out-as-company-preps-for-ipo/?sh=5647912966c3 |access-date=14 June 2021 |work=Forbes |date=20 March 2017}} In March 2019, Rent the Runway received a new round of financing that increased its valuation to the unicorn level of $1 billion.{{Cite news|url=https://www.nytimes.com/2019/03/21/business/rent-the-runway-unicorn.html|title=Rent the Runway Now Valued at $1 Billion With New Funding|last=Maheshwari|first=Sapna|date=2019-03-21|work=The New York Times|access-date=2019-09-24|language=en-US|issn=0362-4331}}
In September 2023, Rent The Runway began to decline, as sales were failing to meet soaring consumer demand after a disappointing quarter.{{Cite web|url=https://www.pymnts.com/news/retail/2023/rent-the-runway-struggles-with-meeting-soaring-consumer-demand/|title=Rent the Runway Struggles to Meet Soaring Consumer Demand|date=September 11, 2023|access-date=October 3, 2023|website=PYMNTS|language=en}} In October 2023, CreditRiskMonitor reported that Rent the Runway was nearing a potential Chapter 11 bankruptcy filing.{{Cite web|url=https://www.retaildive.com/news/retailers-at-risk-of-bankruptcy-2023/694548/|title=11 retailers at risk of bankruptcy in 2023|date=October 2, 2023|access-date=October 3, 2023|website=Retail Dive|language=en}}
Business model
File:Rent the Runway Flagship (48072711898).jpg
The company offers clothes from over 700 designers, in sizes ranging from 00 to 22. In addition to garments for events, the company also rents everyday clothing, children's clothing, ski apparel, home décor, and accessories, including jewelry and handbags.{{cite news |last1=Nassauer |first1=Sarah |title=Rent the Runway Is Growing Fast, and Struggling to Keep Up |url=https://www.wsj.com/articles/rent-the-runway-is-growing-fast-and-struggling-to-keep-up-11563890548?mod=article_inline |access-date=14 June 2021 |publisher=Wall Street Journal |date=23 July 2019}}{{cite news |last1=Macon |first1=Alexandra |title=Rent the Runway Launches Kids—and My Two Daughters Took It for a Test Drive |url=https://www.vogue.com/article/rent-the-runway-launches-kids-test-drive |access-date=14 June 2021 |publisher=Vogue |date=8 April 2019}}{{cite news |last1=Lockwood |first1=Lisa |title=Rent the Runway Adds Ski Apparel, Ath-leisure |url=https://wwd.com/fashion-news/fashion-scoops/rent-the-runway-adds-ski-apparel-ath-leisure-1203382334/ |access-date=14 June 2021 |publisher=Women's Wear Daily |date=3 December 2019}} The company offers several subscription plans at varying prices, that can be customized. According to the company, as of 2019 subscriptions account for 75% of its business.{{cite news |last1=Leighton |first1=Mara |title=Rent the Runway just launched a new subscription option that lets members rent 8 items per month for $135 |url=https://www.insider.com/rent-the-runway-2-swap-membership-review |access-date=14 June 2021 |publisher=Insider |date=3 March 2020}}
Customers can also rent clothes for a 4- or 8-day period without signing up for a subscription as part of the company's Reserve program.{{cite news |last1=Stoll |first1=John |title=How Is Rent the Runway Still In Business? The CEO Moved Quickly, Cut Deep. |url=https://www.wsj.com/articles/how-is-rent-the-runway-still-in-business-founder-moved-quickly-cut-deep-11594393201 |access-date=14 June 2021 |publisher=Wall Street Journal |date=10 July 2020}} Each rental includes a back-up size at no additional cost to ensure it fits. Customers can get a second style for an additional fee. Rental prices include the dry cleaning and care of the garments. In 2021, the company began allowing anyone to buy items secondhand from its site without a membership.{{cite news |last1=Stoll |first1=John |title=Coronavirus Prompts Rent the Runway to Think Beyond Rentals |url=https://www.wsj.com/articles/coronavirus-prompts-rent-the-runway-to-think-beyond-rentals-11603815160 |access-date=14 June 2021 |publisher=Wall Street Journal |date=27 October 2020}} Subscribers have had the option to buy items they rented since 2016.
Rent the Runway had physical locations in New York City, Washington, D.C., Chicago, San Francisco, and Los Angeles,{{Cite web|url=https://www.renttherunway.com/stories/stores|title=Store Location Listing|website=Rent the Runway}} where customers could work with a personal stylist, and either take items directly with them or book dresses and accessories for future events. In August 2020, the company announced it would be closing all five of its retail locations, in order to focus on digital subscriptions, and would be adding more drop box locations.{{cite news |last1=Thomas |first1=Lauren |title=The clothing rental start-up Rent the Runway is closing all of its stores for good |url=https://www.cnbc.com/2020/08/14/retail-start-up-rent-the-runway-is-closing-all-of-its-stores-for-good.html |access-date=14 June 2021 |publisher=CNBC |date=14 August 2020}}{{Cite web |last=Schulz |first=Madeleine |date=2023-07-11 |title=Can peer-to-peer rental scale in the US? |url=https://www.voguebusiness.com/companies/can-peer-to-peer-rental-scale-in-the-us |access-date=2025-01-24 |website=Vogue Business |language=en-US}}
According to the company, it has the biggest dry cleaning operation in the United States and possibly the world, processing 2,000 items per hour (as of 2018).{{cite web|url=https://www.economist.com/business/2018/06/07/rent-the-runway-is-taking-clothes-sharing-mainstream|title=Rent the Runway is taking clothes-sharing mainstream|publisher=The Economist|date=7 June 2018}} The company has distribution warehouses in Secaucus, New Jersey, and Arlington, Texas.{{cite news |last1=Jimenez |first1=Carla |title=Rent the Runway's new Arlington fulfillment center is like a 300,000 square-foot closet |url=https://www.star-telegram.com/news/business/growth/article232567817.html |access-date=14 June 2021 |publisher=Fort Worth Star-Telegram |date=12 July 2019}}
In September 2019, Rent the Runway experienced an 11-day operational glitch and temporarily stopped accepting new customers.{{Cite web|url=https://nypost.com/2019/10/08/rent-the-runway-back-online-after-11-day-tech-glitch/|title=Rent the Runway back online after 11-day tech glitch|date=October 8, 2019}} The company resumed regular operations on October 15, 2019, after implementing system upgrades.{{cite news |last1=Thomas |first1=Lauren |title=Rent the Runway 'back to business as usual' after supply chain chaos |url=https://www.cnbc.com/2019/10/08/rent-the-runway-back-to-business-as-usual-after-temporary-chaos.html |access-date=14 June 2021 |publisher=CNBC |date=8 October 2019}}
Awards and honors
Rent the Runway was named on CNBC's Disruptor 50 list in 2013,{{cite web |title=2013 Disruptor 50 List |url=https://www.cnbc.com/cnbc-list-of-disruptors/ |website=CNBC |access-date=24 June 2021}} 2014,{{cite web |title=2014 Disruptor 50 List |url=https://www.cnbc.com/2014/06/17/cnbc-disruptor-50.html |website=CNBC |access-date=24 June 2021}} 2015,{{cite web |title=2015 Disruptor 50 List |url=https://www.cnbc.com/2015/05/12/rent-the-runway-disruptor-50.html |website=CNBC |access-date=24 June 2021}} 2018 and 2019.{{Cite web|url=https://www.cnbc.com/2019/05/14/rent-the-runway-2019-disruptor-50.html|title=Rent the Runway 2019 Disruptor 50|last=staff|first=CNBC com|date=2019-05-15|website=www.cnbc.com|access-date=2019-09-28}} The company was named one of Fast Company's Most Innovative Companies in 2011, 2015, 2018 and 2019.{{cite web |title=Most Innovative Companies: Rent the Runway |url=https://www.fastcompany.com/company/rent-the-runway |website=Fast Company |access-date=24 June 2021}}{{Cite web|url=https://www.fastcompany.com/most-innovative-companies/2018/sectors/retail|title=The World's Most Innovative Companies 2018: Retail Honorees|website=Fast Company|language=en-US|access-date=2019-09-28}}{{Cite web|url=https://www.fastcompany.com/most-innovative-companies/2019/sectors/social-good|title=The World's Most Innovative Companies 2019: Social Good Honorees|website=Fast Company|language=en-US|access-date=2019-09-28}} In 2018, Fast Company recognized RTR Unlimited as a World Changing Idea; in 2014 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;{{Cite web|url=https://www.fastcompany.com/40546728/the-2018-world-changing-ideas-awards-finalists|title=The 2018 World Changing Ideas Awards Finalists|last=Staff|first=Fast Company|date=2018-04-09|website=Fast Company|language=en-US|access-date=2019-09-28}}[http://bestcompaniesny.com/UserFiles/File/Press%20Release%20-%20Winners%20of%202014%20Best%20Companies%20to%20Work%20for%20in%20New%20York%20State%20Announced.pdf "Winners of 2014 Best Companies to Work for in New York State Announced"], January 6, 2014 and in 2010, Time magazine named it one of the 50 best websites of the year.TIME Staff, [https://content.time.com/time/specials/packages/article/0,28804,2012721_2012901_2012897,00.html "50 Best Websites 2010"], "TIME", August 25, 2010
In 2019, Time recognized Hyman as one of their 100 Most Influential People.{{Cite magazine|url=https://time.com/collection/100-most-influential-people-2019/5567849/jennifer-hyman/|title=Jennifer Hyman: The 100 Most Influential People of 2019|magazine=TIME|language=en-us|access-date=2019-09-28}} The firm and Hyman were named one of the 12 Most Disruptive Names in Business in 2013 by Forbes,Carlyle, Erin, [https://www.forbes.com/special-report/2013/disruptors/jennifer-hyman_jennifer-fleiss.html "Disruptors"], "Forbes" and Hyman was included on Fortune’s Trailblazers list of individuals changing the face of business in 2013.Fry, Erica, [https://money.cnn.com/gallery/news/companies/2013/02/07/trailblazers.fortune/5.html "Trailblazers: 11 People Changing Business"], "Fortune", February 8, 2013 Both Hyman and co-founder Fleiss have been named to Inc. Magazine’s “30 Under 30,” Fortune’s “40 Under 40,”Keating, Caitlin, [https://money.cnn.com/gallery/magazines/fortune/2012/10/11/40-under-40.fortune/29.html "40 Under 40"], "Fortune", October 17, 2012 Fast Company’s “Most Influential Women in Technology,”Evans, Suzy [http://www.fastcompany.com/3016964/women-in-tech-2011/the-most-influential-women-in-technology-2011-jennifer-hyman-and-jennifer "The Most Influential Women in Technology 2011 - Jennifer Hyman and Jennifer Fleiss"], "Fast Company", January 10, 2011 Fashion Group International’s 14th annual Rising Stars in Retail,[http://www.fgi.org/pdfs/fgi_bulletin_20110509.pdf "14th Annual Rising Star Awards"], "FGI Bulletin", 2011 Forbes' "Women Entrepreneurs to Watch",{{cite web|url=https://www.forbes.com/sites/katiasavchuk/2016/06/15/serena-williams-katy-perry-women-entrepreneurs-to-watch-self-made/#7502c8fb255d|title=From Serena Williams to Katy Perry: Eight Women Entrepreneurs To Watch|first=Katia|last=Savchuk|website=Forbes |publisher=|accessdate=21 December 2016}} and The Business Journal 2016 Upstart 100 Class of Creatives.{{cite web |url=http://www.bizjournals.com/bizjournals/news/2016/08/18/the-creatives-upstart-100-celebrates-artful.html#g7 |title=The Creatives Upstart |date=August 18, 2018 |website= bizjournals|access-date=2020-12-03}}
References
{{reflist}}
Category:Online retailers of the United States
Category:American companies established in 2009
Category:Retail companies established in 2009
Category:Internet properties established in 2009
Category:Clothing rental companies
Category:Subscription services
Category:2021 initial public offerings