The future of fashion: How The RealReal and Revolve are reinventing retail
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Shares of Revolve (RVLV) were soaring on Tuesday. As the quiet period following the IPO has just ended, all but one analyst initiated a buy rating on the stock. After going public last month, the trend and millennial-focused e-tailer closed 89% higher on its first day as a public company.
Revolve’s success reflects a broader shift in women’s clothing, especially as e-commerce already accounts for 28% of all apparel sales.
“It doesn't surprise me that [Revolve] is doing so well. I think that so many interesting companies are cropping up right now with a really, really tight read on consumer desires and demands. Often, it's the consumer that's starting the company. Retail had become so stale. It became so expected, and I think that there's some really, really interesting entrepreneurs that are diving in,” Sali Christeson, founder and CEO of women’s workwear company Argent, said last week during an interview for Breakouts, Yahoo Finance’s live interview series.
Christeson first launched Argent three years ago as a fashion-forward, functional alternative to the often-drab options women have for workwear. Having raised $6.1 million to date, the San Francisco-based brand positions itself as accessible luxury, with bright-colored suits pricing at roughly $600.
The successful exits of digital-first retailers like Revolve and high-end consignment store The RealReal (REAL) bode well for entrepreneurs like Christeson as they try plot their profitable futures.
Just as Revolve has been buoyed by social and influencer culture, Argent has relied heavily on celebrity clientele to elevate the brand. Hillary Clinton, Kamala Harris, Gloria Steinem, Awkwafina, and Amy Poehler are among the many influential women who have sported the suits.
Female-founded fashion
U.S.-based fashion and beauty startups like Argent raised a total of $2.1 billion in funding in 2018. While it makes up less than 2% of the total $131 billion venture capital pie, it’s clear investors are on the hunt for innovative e-commerce players — and many of these companies were started by women.
While female founders merely raised 2.2% of all venture capital dollars last year, retail has more gender parity than nearly every other industry. Last year, female-founded retail businesses raised about half of the amount of VC funding given to male founders ($254.6 million compared to $439.9 million).
“I think for us, we've been overwhelmed by the response that we've gotten. Women’s workwear is a $34.9 billion industry in the U.S. alone. Prior to us launching Argent, women rated the experience of shopping for work clothes a 3.9 out of 10. We’re hoping to change that,” Christeson said.