The Digital Renaissance of Fashion
As a serial entrepreneur, Techstars alum, Co-founder of the New York Fashion Tech Lab, and advisor and mentor to numerous fashion tech companies around the globe; I’ve had a front row seat in witnessing, contributing to, and shaping the reinvention of fashion, retail and digital commerce for the last 22 years.
When I developed and built the NYFT Lab in 2014, it was born from my direct, personal need to fix the largest issues impacting the growth of emerging fashion tech startups — the lack of direct C-level access and support from big brands and retailers and the lack of investor capital. When my fashion tech startup, Shopsy, failed in 2013, I was shocked to receive unsolicited inquiries from a few of the largest brands and retailers I could have hoped to land as partners. They asked what happened to the tech because we had built something they had never seen before and needed — contextual and personalized merchandising to the customer of one. I replied that we were unfortunately fully dissolved because I couldn’t get to the right C-level execs to sell the platform as B2B and every investor was insisting that we go B2C. I even had numerous investors tell me that I should have just purchased some inventory, like that Nasty Gal.
This was my first glimpse into just how foreign the world of fashion is to most investors. The majority of VCs are men whose eyes glaze over when they hear the word fashion. They would either admit that they knew nothing about the space and/or that it held zero interest to them, because they invest in what they know; or they would say they’d go home and ask their wife, daughters, sister, secretary, etc. to “check it out and share their thoughts.” I’d be a thousandaire if I had a nickel for every fashion tech founder that has heard those words and then had the investor come back the next day to say that their [fill in the female] feedback was immensely positive, but they still wouldn’t invest, or worse; to come back when you’ve hit a million users, or $5 million in revenue, or some other target they’d keep moving.
Of course, this is not entirely unique to fashion tech, but when you add up the additional hurdles to investor buy in, it becomes seemingly impossible — a preponderance of female founders (who are statistically funded far less than their male counterparts), an industry that isn’t in an existing area of interest for most VCs (in their own words, because they are male and “hate to shop” or “don’t know anything about fashion”), investors look for patterns they know and when the entire global industry is rapidly evolving; from raw materials, sourcing, digital textiles, 3D printing, robotic apparel manufacturing, wearables, artisanal fair trade supply chains, sustainability, zero waste, recycling, experiential retail, AR/VR, peer-to-peer commerce, voice, images, and video, to name a few; they generally lack the insights to predict the viable outcomes.
Opportunity usually presents itself in times of crisis. We can all agree that the retail landscape is in a state of collapse because the digital immigrant brands (created prior to the digital era — Macy’s, J.Crew, Sears, etc.) have been shackled with their archaic infrastructure, lack of pervasive digital culture, siloed systems, and their race to the bottom, which has put them in a state of perpetual deep discount. You could say that these companies have been committing suicide via their echo-chambers of large consultancies who have been working to keep their contracts, rather than providing the wake up call they needed over 10 years ago.
It is not difficult to have predicted these outcomes. What is difficult is telling some of the largest brands and retailers that the tide of digital natives is coming and that they will have speed, agility, cloud-based, state of the art infrastructure, and a culture of perpetual innovation on their side.
Amazon is the obvious digital native whale that has been reeking havoc on the fashion landscape as it endlessly predicts and devours the most valuable assets in their unique end-to-end ecosystem. For the existing digital immigrants to have a fighting chance, perhaps the best option is to borrow from Amazon’s lessons learned and invest collectively in supporting an infrastructure serving external customers to ensure perpetual innovation.
Perhaps, the industry should be proactively ideating more collaboratively, much like developers expand their code base via open source. It takes bold steps from bold leaders to embrace change rather than simply triage the bleeding. It will take bold, informed VCs to invest in the rebirth of this growing, $2.4 trillion dollar global industry.
This radical change is being led by the first wave of fashion tech’s leaders who are now leveraging their lessons learned, strategic insights, and expertise to reinvent the future of fashion. If you are interested in building the future rather than merely slowing the death spiral, seek out the helpers and the visionaries and let them empower you to be bold. “We can’t solve problems by using the same kind of thinking we used when we created them.” — Albert Einstein
Want to learn more about the fashion tech landscape and investment opportunities? I worked with the team at Dressometry to articulate my initial overview on the Fashion Tech Investment Landscape (see link below).
I’ve been advising their team for over a year and I have been impressed with their ability to generate highly detailed fashion product data using computer vision and machine learning. They’re really onto something and I look forward to continuing to work alongside them.