In Its IPO, Rent the Runway Is Eyeing a $1.3 Billion Valuation. It Owes It All to This Adaptation Strategy

In Its IPO, Rent the Runway Is Eyeing a $1.3 Billion Valuation. It Owes It All to This Adaptation Strategy

When Jennifer Hyman made Inc.'s Female Founders 100 list in 2019, her company Rent the Runway, had just attained unicorn status. Now, the clothing and accessories rental service has officially filed for an IPO and is aiming for an even higher valuation of $1.3 billion.

Since founding the New York City-based company in 2009 as a gown and cocktail dress rental service, alongside her then Harvard Business School classmate Jenny Fleiss, Hyman has taken RTR in many new and novel places. The company has introduced three tiers of a subscription model that allow shoppers to rent up to 16 items per month at a flat fee. As of July 2021, it had shipped over 40 million items with a value of $16 billion, and served over 2.5 million customers. It even briefly expanded into brick-and-mortar retail.

The company's path has not been without hardship. In 2015, about two percent of the company--including several members of the C-suite--resigned after rumors of a toxic work culture spread. Its S-1 filing shows that total revenue declined by 38.7 percent in 2020, and during the pandemic, the company laid off all of its brick-and-mortar staff over Zoom, and furloughed others.