Why Rent the Runway CEO has to explain the business’ “right to exist”

Why Rent the Runway CEO has to explain the business’ “right to exist”

Rent the Runway CEO Jennifer Hyman runs a unicorn-status company with a billion dollar valuation in a rapidly growing industry, but she still finds herself explaining her business’ “right to exist” to venture capitalists — nearly 90 percent of whom are men.

“The major penalty that exists for female CEOs is that I have to waste 25 percent of my time explaining what my business does,” Hyman told Recode’s Jason Del Rey onstage at Code Commerce on Tuesday. Hyman said male investors often based their assessments of the industry based on “audiences of one,” like their wife, since they don’t use the product themselves. (Another retail executive, The RealReal founder and CEO Julie Wainwright, made a similar observation on Monday at Code Commerce.)

“All I want is to be evaluated based on my data. That’s it,” said Hyman. “This is an industry that claims that it’s a data-driven industry. In my experience over the past 10 years, I’ve found it’s a lot more emotionally driven than the industry gives itself credit for.”

Despite these kinds of challenges, Hyman has been able to get through to funders — with some strong numbers to prove it. In March, the company raised $125 million at a billion dollar valuation. She said the company’s subscriber base is growing 100 percent year over year, and traffic is up by 10 percent over the past two years in the company’s in-person stores, where customers can try on clothes to rent.

Hyman was also thankful for the female investors who helped lead the company’s last round of funding and said there should be more women with the opportunity to fund new businesses.

“Women don’t control the capital,” said Hyman. “It’s not about the number of female investors; it’s about what access do they have to write big checks.”

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