In 2008, Hyman and Fleiss met as sectionmates at Harvard Business School. They regularly met up to discuss entrepreneurial ideas, one of which was Rent the Runway. The company has received approximately $126 million in venture capital from Bain Capital Ventures, Highland Capital, Kleiner Perkins Caufield & Byers, Condé Nast’s parent companyAdvance Publications, American Express, and Novel TMT Ventures. As of October 2016, the firm has over 6 million customers, 975 employees, and over 400 designer partners. In 2015, the company suffered negative press after the departure of several executives such as CTO Camille Fournier and Linda Honan. 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. As of March 2019, Rent the Runway received a new round of financing that increased its valuation to the unicorn level of $1 billion.
Business model
Customers can rent one of the firm's designer clothing for a 4- or 8-day period for as low as 10% of the retail price through their traditional platform, RTR Reserve. There are also monthly subscription options that allow items to be shipped either "unlimited" or 4 items per month for a lower cost. Rent the Runway carries apparel in sizes 0 to 22, depending on the designer. Each dress rental includes a back-up size at no additional cost to ensure it fits. Customers can get a second dress style for an additional fee. Rental prices include the dry cleaning and care of the garments. The company also rents children's clothing, accessories, including jewelry and handbags, and sells “essentials,” including lingerie, tights, shapewear, and cosmetics. Rent the Runway has physical locations in New York City, Washington, D.C., Chicago, San Francisco, and Los Angeles. Customers can visit any of Rent the Runway’s five stores, work with a personal stylist, and either take items directly with them or book dresses and accessories for future events. The company has the biggest dry cleaning warehouse in the world, processing 2,000 items per hour. In September 2019, Rent the Runway experienced an 11 day operational glitch and halted service.
Awards and honors
Rent the Runway was recently named #5 on CNBC's Disruptor 50 2019 list. In 2018 Rent the Runway was listed as #9 on the CNBC Disruptor 50 list. Rent the Runway has been named one of Fast Company's Most Innovative Companies for two consecutive years in 2018 and 2019. In 2018 Fast Company recognized RTR Unlimited as a World Changing Idea and The New York StateSociety for Human Resource Management honored Rent the Runway as one of the best companies to work for in New York State in 2014. In 2013, the firm was named one of the 50 companies disrupting the status-quo by CNBC, one of the 10 most innovative fashion companies by Fast Company in 2011, and one of the 50 best websites of 2010 by TIME magazine. In 2019 TIME recognized Rent the Runway's CEO and Co-Founder, Jennifer Hyman, as one TIME's 100 Most Influential People of 2019. The firm and its CEO and Co-Founder Jennifer Hyman was named one of the “12 Most Disruptive Names in Business” in 2013 by Forbes and she was included on Fortune’s “Trailblazers” list of individuals changing the face of business in 2013. Both Hyman and co-founder Jennifer Fleiss have been named Inc. Magazine’s “Top 30 Under 30,” Fortune’s “40 Under 40,” Fast Company’s “Most Influential Women in Technology,” and Fashion Group International’s 14th annual Rising Stars in Retail, by Forbes in 2016 as "Women Entrepreneurs to Watch", and as "The Creatives" on the 2016 Upstart 100.
