Wardrobe, the New York-based peer-to-peer rental marketplace for luxury and vintage fashion, has acquired Rent My Wardrobe, a Dallas-based peer rental business popular in the Southern U.S.
The all-stock deal comes on the heels of Wardrobe’s one-year anniversary of its limited launch in New York City, and its national launch in August, along with user and revenue growth. The acquisition is expected to widen Wardrobe’s geographic reach and add tens of thousands of Rent My Wardrobe users and their closets, as well as expand their influencer relationships.
Rent My Wardrobe was recently valued at $4 million. It will be fully merged with Wardrobe’s existing operations.
“Closet-sharing is a movement that’s larger than any one of us or any one city. Women have always borrowed clothes and bags from each other. We are elated to welcome Rent My Wardrobe’s community into ours as Wardrobe continues proving out its model to thousands of new users every month,” said chief executive officer Adarsh Alphons, who started Wardrobe in 2018.
Alphons said Rachel Sipperley, founder of Rent My Wardrobe, reached out to him two years ago on LinkedIn and they kept in touch.
Sipperley, who grew up in Michigan, founded Rent My Wardrobe in 2016. The idea for the business came to her when she was in high school and couldn’t afford to buy a prom dress. Over the years the platform has attracted thousands of users, primarily in Texas, interested in lending out their closets to others who may want to borrow. The start-up is venture-backed and was introduced in a season of “Real Housewives of Dallas.” Its investors include Court and Kameron Westcott from that show.
“I believe financial independence is the highest form of feminism and conceived Rent My Wardrobe as a monetization platform built around a community of women supporting each other,” said Sipperley.
Rent My Wardrobe allows its users to share their closets on its app and lets them coordinate directly to pick up and return borrowed garments. COVID-19 affected their service as direct in-person exchanges were no longer possible. “With Wardrobe’s nationwide shipping service and its technology, we can fulfill the promise we set out to achieve,” she said.
Sipperley will join Wardrobe as vice president of brand and partnerships, focused on customer acquisition and growth.
One of Wardrobe’s advisers and investors is Nathan Blecharczyk, cofounder of Airbnb.
Wardrobe’s lenders consign luxury apparel and accessories to the app or web site, where they photograph it, insure all items, check for quality and partner with about 50 dry-cleaners to create a logistics network that guarantees all items are freshly dry-cleaned. Wardrobe either sends the item directly to the customer from its Brooklyn headquarters or a local dry-cleaner (Wardrobe Hub) near the customer. After they wear it, customers return the item with the return shipping label to the Wardrobe Hub or Wardrobe’s Brooklyn headquarters. Seventy percent of the earnings of the rental go to the lender.
According to Alphons, the company has been growing 100 percent month-over-month for the last quarter despite the public health crisis. The company now ships rental orders to more than 40 states, with a concentration of demand in the South. The company recently launched a web site, wearwardrobe.co, in addition to its app. He’s finding that people tend to use the web site more frequently.
A glance at the web site showed thousands of handbags, footwear and apparel items. For a four-day rental, for example, users can rent a Chanel red quilted handbag for $35, a Louis Vuitton backpack for $36.45, Marc Fisher black suede boots for $20, and a Chloé black dress for $20.50. Clothing and accessories can be rented for four days, 10 days or 20 days.
The most rented item is the Gucci Dionysus shoulder bag, which rents for $35.75 for four days, he said.
“You can earn income from things you’re not using as much,” he said, adding the average user puts $10,000 worth of inventory on the platform. With people not going out as much, and not having a reason to wear their luxury handbags and apparel, they’re more apt to try renting it. “We provide free storage space for you,” he said.
Alphons said the company is putting processes and technology in place to hand over more of its inventory to the dry-cleaners. The dry-cleaners get paid to clean the item and for every rental, they get a guaranteed fixed income, charging Wardrobe on a biweekly basis. Wardrobe gives the dry-cleaners a negotiated rate, so the prices don’t vary greatly. “As we add more dry-cleaners, and they do more washes, costs will go down even more,” he said, adding the dry-cleaners also sanitize the handbags and shoes.
Alphons said the damage and missing rate is very low, at 0.4 percent.
As for the future, Alphons said he’s looking to work with dry-cleaners in Los Angeles, Dallas and Washington, D.C. “We have the customers, but we don’t have the network yet.” Wardrobe has several thousand customers, and in the mid-hundreds of people giving clothes, according to the ceo. “We have a couple of million dollars worth of inventory,” he said. “And the good thing is, we didn’t have to pay for any of that.”
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