The FashionStake Diaries | Part III: Going Live

FashionStake Screenshot | Source: FashionStake

The FashionStake Diaries is a four-part series that gives BoF readers a behind the scenes look at the crucial first months of a crowdfunding fashion startup, seen through the eyes of its founders. Today, as FashionStake goes live, the founders reveal their initial designer lineup and reflect on their journey thus far.

NEW YORK, United States — Almost one year ago to the day, we were sitting in a classroom at Harvard Business School drawing up an idea for a new fashion website. Shortly thereafter, we began the exciting, humbling and often heart-wrenching task of building a company at the intersection of fashion and technology.

Today, we are happy to launch the fruits of our labour. And in this post, we’d like to share some important lessons we learned along the way, introduce our initial designer lineup and encourage you to test drive the new site.

10 LESSONS LEARNED

Distill your vision. Our company’s vision can be expressed in two words: “Democratize fashion.” It took us weeks to come up with a meaningful yet succinct phrase, but we now use it daily when we speak to investors, customers, employees and designers.

Partner with people who act like founders. During our first round of hiring, we looked for experts in technology, web design, marketing and designer relations. But it’s their personal drive and willingness to rally around a vision that has been of greatest value.

Double your cost estimates. We were slugged with hidden cost after hidden cost: lawyers, samples, web hosting and optimization tools… The list goes on. Be prepared.

Great ideas can come from unpredictable places. Some of our best technology ideas came from our merchandising staff. An engineer suggested a new way to run our photo shoots. Our online community manager recommended a state-of-the-art accounting package. Remember, great ideas can come from anywhere.

Establish your own brand first. We received all kinds of partnership, affiliate marketing and co-branding offers, but felt strongly about forging our own brand first, and partnering later.

Go easy on paid marketing. We found that paid marketing channels, such as SEO/SEM and PR agencies, were often low-impact. Instead, we’re focused on sharp editorial, partnering with blogs and great service early on.

Face-to face meetings still rule. We always try to meet designers in person, rather than relying on a flurry of emails and phone calls. It gives us the opportunity to establish trust, and in most instances, actually saves more time than going back and forth electronically.

Soak up feedback. We asked everyone we knew for feedback on our website, business model and value proposition, then figured out whose comments made sense. It’s important to seek feedback and even more important to filter it.

Be transparent. We openly shared bad news about designers, investors and employees with relevant people inside and outside the company, as this helped us come to a solution quickly. We also regularly shared the good news!

Joie de vivre! Startup life can sometimes seem full of endless challenges, long uphill battles and uncertain outcomes. Remembering to enjoy the day’s little victories is crucial.

INTRODUCING OUR DESIGNERS

We’d like to announce our first four designers, all of whom are producing exclusive collections for FashionStake.

Nicholas K: Respected and revered for soft leather and outerwear, Nicholas K is designed by brother-sister duo Chris and Nicole Kunz, who made waves when they first showed at New York Fashion Week in Fall 2003. This season, the label will open New York Fashion Week at Lincoln Center with a show that will feature pieces from their exclusive FashionStake capsule collection. The military-inspired collection features khaki and army-green jackets pared down with soft water camouflage prints. Six lucky FashionStake supporters will receive personal invitations to the show.

Lewis Cho: When Annie Lewis and Helen Cho met in the 90s while working for designer Anna Sui, they immediately bonded over their love for simple yet chic fashion — an aesthetic that has come to define their brand. In fact, the company’s runaway success all started with one simple, but unforgettable dress. It was a designer’s dream: in 2005, less than a year after the label’s launch, a “little white dress” from Lewis Cho’s collection was featured in Vogue. Since then, Lewis Cho has become a fashionista favourite.

AIRA: Launched in Fall 2008 by sisters and Parsons School of Design graduates Annie and Karen Lin, AIRA contrasts masculinity and femininity through structure and romance. Lauded by Women’s Wear Daily, ELLE and InStyle, their exclusive collection for FashionStake is inspired by the book “The Working Riviera” and features romantic dresses, shirts and cardigans with canvas and riveting details.

Yotam Solomon: Yotam Solomon debuted his first collection in October 2007 when he was just 20 years old, making him the youngest designer to ever show at LA Fashion Week. The Israeli-born designer has since become one of LA’s rising stars, known for his winning combination of eco-friendly fabrics and high fashion. Popular among celebrities and editors alike, Yotam continues to impress with his sophisticated, avant-garde designs. He was named LA’s “Top Young Designer” in 2009 by AOL’s Stylelist.

That’s all we can reveal for now. But we’ve already signed a host of designers — both contemporary and luxury ready-to-wear — and will be introducing a new designer on our website every week.

NEXT STEPS

Today is the first day of what we hope will be a long and exciting journey. Now that we’re in execution mode, we’ll be focusing on a few key areas: responding to initial customer feedback, releasing exciting new additions to the website and, of course, ensuring that everyone who visits the site is treated to a great experience. In our next and final post, we’ll give you a status update on the critical first few weeks following launch and touch on our plans for the future.

Vivian Weng and Daniel Gulati are co-founders of FashionStake, a new online marketplace for fashion that launches today.

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17 comments

  1. Interesting.

    I do have some suggestions, comments & questions:

    - Consider having a donate option – Some people may just want to donate and not want to actually buy any fashion items. PayPal & Google checkout would be ideal.

    - Consider having a video/visual tutorial on how the whole process works.

    - I have a fear that you all believe that funding targets will be met soon. What if a funding target is met… 8 months from now? And someone’s credit card is charged by then the fashion item they pre-ordered may be a) out of style or b) no longer wanted …what is your remedy for that.

    - Also I’m interested in seeing how you all will keep your fans interested in all of this in the long term.

    jonathan from Hampton, GA, United States
  2. Ok – so I actually just read the designer bios. These guys seem to be somewhat established. I was under the impression that the designers were fresh, new out of school designers needing money and press – like Project Runway designers.

    jonathan from Hampton, GA, United States
  3. Just checked out the site – really amazing graphics and clothes. I am extremely impressed. The voting mechanism is a nice way to get everyone involved even without committing dollars. Why haven’t retailers thought of this before?

    Jessica R from West Babylon, NY, United States
  4. Frankly, I’m amazed this venture was able to raise any money at all. First of all, the concept “democratize fashion” is a meaningless catch phrase that implies empowerment where empowerment is not needed.

    Second, who wants to invest in something that may never get made or wait around for months for a product that is not likely to be particularly unique?

    I could go on and one with all the problems here. I wish it wasn’t the case because these “visionaries” put a lot of hard work into their project. That said, I predict they will be out of business in six months unless the model is radically tweaked along the way.

    Roher Dunhill from Stoke Hammond, Bedfordshire, United Kingdom
  5. P.S. Also, if these designers were so great in the first place, why do they need such piddling amounts of money? If they are so “hot” one wonders why backers never materialised or why they could organically grow their brands.

    Roger Dunhill from Stoke Hammond, Bedfordshire, United Kingdom
  6. This was always going to fall flat on its face… but I do love watching the yanks fail miserably… by the way, did somebody forget to mention ‘menswear’ in all these pioneering meetings? ahh… priceless. The ‘voting mechanism’ that got a mention from Jessica isn’t particularly groundbreaking? Fairly sure it’s basic web 2.0 and the reason brands like Topshop or H&M don’t use it is because their net revenue indicates it’s not required. The masses love to be told what to do, what to wear, where to go, who to be seen with, popular media garbage… the only way fashionstake stands a chance is to target a specific niche market aesthetically…otherwise there’s way too much going on. Seems this ‘future fortune 500′ company is being run by a couple of pretentious business grads…but…it’s a juicy story and has us all talking about it ;) So at least they’ve achieved something…

    moi from Exeter, Devon, United Kingdom
  7. The only point I disagree with is that SEO shouldn’t be something to spend on. Paid search ads may not be worth it until there’s a wider variety of merchandise, but organic search always needs to be considered while the site is being built, or it could end up being a costly disaster later. For evidence, just look at the all flash sites like Versace and Christian Louboutin that can’t even rank for some branded terms. Consequently, look at ShopStyle, who has first page rankings for many of the brands it sells – all because of a focus on SEO.

    Fashionstake doesn’t appear to have this problem, but lumping SEO in with paid search and PR when you’re an online venture is a dangerous idea. There are some sites which do perfectly well without SEO (Gilt, RueLaLa), but these are the exception, not the rule.

  8. This is hilarious. Where is the USP ? Nobody cares when they buy a dress about democratic rights. The founders of are so proud they came up with the blindingly brilliant concept “democratize fashion” and they “use it daily” with all their colleagues yet the slogan is patently illogical. With millions of options, great brands, tons of online shops, is the average punter really going to invest their money in an unknown designer with the pay-off of some mediocre product? So much of the product is made with wool/poly blends, and lower quality cloth. Won’t customers see through the phoniness of saving money on a non-existant “retail” price.” These people should work for a PR company or start one themselves. This ain’t gonna fly.

    David Royce from Europe
  9. TAKEN FROM THE SITE:
    –What items will you sell in the store?
    When collections are fully funded and have been produced, the designer sends the items to FashionStake. We then will make them available on our online store for anyone to purchase.

    –When will the store be ready?
    The store will go live in November 2010.

    –In Production (1-2 months)
    Stay updated as the designer, factory and FashionStake work together to produce the collection.

    ————————

    So it takes 1-2 months for a collection to be produced. And you guys say the store will go live in November after the targets are met. So I’m guessing you guys believe the targets will be met by next week huh? IS THIS A JOKE????!

    Kelly Martin from Hampton, GA, United States
  10. I really like the idea, and I think that people will respond well to being a part of the making of a fashion brand. I also think this has the potential to do well in places like India and China where there are a number of young, talented designers in need of funding. Good Luck!

    roughluxegirl.blogspot.com

  11. It’s been roughly 24 hours since launch and this has probably received a vast amount of traffic from the Mashable link. Yet by my calculations, at the current rate of funding, the collections will take about 2 Months to reach 100% backing.

    The descriptions state you could recieve your product 8 weeks after full funding is reached. So combine that with the estimated 8 weeks to reach funding and you might receive your product in 4 months!

    Some of these designs look like a SS range not an AW range, the collections probably shouldn’t be season focussed because the date when the consumer would receive the product is indefinite.

    These are ‘established designers’ with previous collections, but have not made enough from sales to fund their next collection? With a proven business model and previous sales, accessing a short term funding for these amounts shouldn’t be much of a problem. My question is why haven’t they sought funding from a bank? Will the business pass integrity checks from a bank? Is this a safe investment?

    If I was planning on investing I’d also like to know what percentage of the funding/sales is given to FashionStake. It doesn’t appear to be a registered charity so I assume they’re in it to turn a profit?

    How is this investment money passed onto the designer? It’s not a purchase of stock or products, it’s just money. Will this money be taxed? (seems like this cash is accrued to the designer and liable for tax, where a bank loan is not?)

    To me it seems almost beneficial to be a registered charity. In fact someone like Fashion East (which is registered as a charity in the UK) could benefit from this. The ‘investors’ could also make a tax deduction rather than handing over income that has already been taxed.

    As an outsider I am not privy to the accounting practices, but this doesn’t seem to be as efficient as I think it could be.

  12. I just want to say that I’m stunned by the negative comments here. I haven’t even checked the website yet, but as a young entrepreneur myself I can only say that everything these guys say about nuilding a business is true, interesting, and researched.
    I think they deserve the benefit of doubt.
    And maybe we should do a fast-rewind and remember how people similarly dismissed Natalie Massenet’s vision when she launched NAP 10 years ago.
    Innovation is for the strong minds and I wish more of us were.

    Fanny from Jaipur, Rājasthān, India
  13. I think this is a great concept. Tweeks to work out – but even to have a place where you can find designs created by the up and comers – who are unique in their back grounds and product offerings is very cool.

    We are doing something similar for jewelry & accessories designers ICU – In Paris. Not a place to donate but an e-commerce platform based in Paris to find, submit and love, love, love all jewelry created with quality – independent from the masses. Launching middle of this month – so I hope for all of us who are trying something different on the web good luck and keep going – you have something good FashionStake.

  14. Right on Fanny. Wow some people sound superbitter.
    Anyhow I wish the people at Fashionstake all the best with there venture I think its a very good concept especially those around the young designer (fam&friends who dont have millions will still support them trough a website like this). And remember high risk , high reward!!! Go for it !!!

  15. Interesting how all the really nasty comments came from middle-aged men who are probably leaps away from the target audience.. just a thought lol

    Olga N from West Babylon, NY, United States
  16. I think there are lots of valid points made about things that need to be worked out with the model or addressed in a future post (will consumers wait 4 months for fashion? where is the line between donation and purchase? Will buyers understand that difference?), but to moi’s comment and the ones not offering constructive criticism, at least they’re trying.

    Will they succeed? Perhaps not without a shift to the business model and future changes, but even if they fail I admire them for taking the risk and actually getting into the arena. For an industry that always touts how forward thinking it is, fashion is behind and dated in so many areas precisely because of that overwhelming fear of failing at something new.

    http://techcrunch.com/2007/10/12/the-man-in-the-arena/

  17. I think this is a great concept. Tweeks to work out – but even to have a place where you can find designs created by the up and comers – who are unique in their back grounds and product offerings is very cool.