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With $100M revenue, 500K new users a month, this subscription fashion service has a bright future
Online fashion and retail is hotter than the latest runway trends. Just a week after the design-centric flash sales site secured a whopping $105 million, the subscripton fashion site JustFab has announced that it raised $76 million. This C-round of funding was led by new investor Rho Ventures, with participation from existing backers Matrix Partners, Technology Crossover Ventures (TCV) and Intelligent Beauty.
The young startup, launched in 2010, has now raised roughly $139 million for a business with more than six million members.
Earlier this year, JustFab rolled out its service for a European audience, with a German office that co-CEO Adam Goldberg told me went “far better than expected and has encouraged us to expand to the UK after summer.”
“The styles translated incredibly well to the German market,” Goldberg told me. “And combined with the growth we have seen in the US, we are on track for $100 million in sales and expect $500 million by 2015.”
The El Segundo, Calif.-based company has received a lot of engagment and sign-ups through social sharing – roughly 25% of the new members came in through social channels like a friend sharing on Facebook or a link through Pinterest.
Pinterest is a great fashion tool for our company. We have our own Also as part of this announcement, Mark Leschly, managing partner at Rho Ventures, will join the board.
How JustFab works
All you have to do is create a profile by picking from a variety of images – by choosing the ones that best fit your style. The platform prompts you to choose from bohemian and business casual options and even a line-up of celeb red carpet outfits in order to offer the best styles that fit your shoe and accessory desires.
Customers are also encouraged to rate shoes they see on the site based on style and color so that, in the future, it can tailor your preferences better.
The VIP program, as JustFab has labeled its subscription service, sets the price of most items at $39.95 and if users spend that base rate each month on an item, then additional items purchased will also be places at that price, with some exceptions priced at $49 and $79.
While shoes were the central focus of JustFab in the early days, the service has added handbags and accessories in recent months.
JustFab has a stable of stylists picking out the latest trends to offer people with different tastes and provide not just the items, but also the rationale and combinations suggested behind the choices.
Currently the young company has 150 fashion consultants creating personalized boutiques and are available online for consultation 24/7. You know, in case there is a serious fashion emergency.
Goldenberg even divulged to me that as the company has built out its online community of stylists and member, many of the people online have posted items they bought, pairings and fashion situations to get expert advice.
JustFab’s demographic sweet spot is women 24-35, but they do have a broader appeal (thanks to the specialized style themes) to women 18-40.
JustFab is in the same space as ShoeDazzle and offers items at the same price point, but Goldenberg explained that his company differs from its competitor primarily because it is growing its site into an entire style source.
"We like to think of JustFab as a fashion magazine tailored to our clients with the perk that you can buy the featured items and not break the bank," Goldenberg stated.
The growing demand around online fashion
High fashion has usually been unattainable to the masses because of the price-point, the physical access and the knowledge. The Internet has changed that around completely. Now everyone can know (up to the minute) fashion trends. Everyone can also get anything delivered to their door in a matter of days. And most fashion houses can start cranking out affordable versions of couture in weeks rather than months.
So now fashion has become the hot commodity online as VC's scramble to back the best bets and online retailers try to expand their reach to include fashion items.
At the beginning of the year, the design retailer Fab.com announced that it acquired the community-selected marketplace of designers: FashionStake. In the past two years, Fab.com has done a lot of innovating and pivoting to find its niche and was handsomely rewarded with more than $50 million of funding from venture big boys such as Andreessen Horowitz, Menlo Ventures and First Round Capital.
Now that the company has the capital to start acquiring other design, fashion and daily deal sites, things are getting quite interesting.
Earlier this year, a new company, Style For Hire, set out to bring the curation and personalization of having a stylist to the masses. The young supportive fashion company, co-founded by celebrity stylist Stacy London and Cindy McLaughlin, launched with 135 stylists in 24 cities in the U.S. today. In cities including New York, Los Angeles, Chicago, San Francisco and Boston; Style For Hire wants to match you up with a stylist that understands your aesthetic and can help you get all those needed elements into your wardrobe.
The company offers multiple services, including closet audits, closet shopping, and personal shopping. So whether you are about to enter the workforce, change professions, you've just lost the baby weight, you are shopping for the wedding, or just need a boost in you winter apparel, Style for Hire professionals could be the solution.
The rate per hour ranges from $65 to $300 and the average length of an appointment is 2.6 hours. The company started with a soft launched about a year ago, and is already seeing 46% of clients re-book two or more times and 22% came back three or more times within the year.
The company has raised $1.5 million in funding from Golden Seeds thus far.
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JustFab (www.JustFab.com) is an online fashion styling service and
lifestyle fashion brand that offers members a fun and engaging personalized
shopping experience. Members of the fashion service are given the celebrity
treatment every month as they receive a customized selection of shoes and
handbags, handpicked by stylists, along with the JustFab basics of denim and
other fashion essentials. VIP members can purchase items for $39.95 and
shipping is always free.