Rent the Runway doing things that don't scale

In the world of fashion, few startups have disrupted the industry as dramatically as Rent the Runway. The company, which allows women to rent designer dresses and accessories for a fraction of their retail price, has transformed how many women approach special occasion dressing. But before Rent the Runway became a billion-dollar business with millions of customers, it started with a decidedly unscalable approach: two Harvard Business School students hosting trunk shows in dorm rooms and campus buildings, letting fellow students try on borrowed designer dresses.

The Genesis: A Sister’s Closet Crisis

The story of Rent the Runway begins in 2008 with Jennifer Hyman, then a second-year MBA student at Harvard Business School. During Thanksgiving break, Hyman watched her younger sister Becky struggle with a familiar dilemma: she had purchased an expensive new dress for an upcoming wedding but would likely never wear it again after the event. The dress had cost $1,600—a significant expense for someone just starting her career.

“My sister had a closet full of dresses she’d worn only once, yet she felt she had nothing to wear,” Hyman later recalled. “She was considering buying yet another expensive dress that would meet the same fate.”

This observation sparked an idea: What if women could rent high-end designer dresses for special occasions instead of buying them? The concept would give women access to aspirational fashion at a fraction of the retail cost while solving the “wear it once” problem that plagued many women’s closets.

Excited by the potential of this idea, Hyman shared it with her Harvard Business School classmate Jennifer Fleiss. The two had previously worked together on class projects and had complementary skills—Hyman had a background in marketing and retail, while Fleiss had experience in finance and strategy. Together, they decided to explore whether this concept could become a viable business.

The Hypothesis: Would Women Rent Designer Dresses?

Before investing significant time and resources into building a business, Hyman and Fleiss needed to test several critical assumptions:

1. Would women be willing to rent dresses they didn’t own?
2. Would they pay a meaningful amount to do so?
3. Would they return the dresses in rentable condition?
4. Would designers be willing to participate in such a program?

Rather than conducting market research or building a website, the founders decided to test their concept in the most direct way possible: by putting actual designer dresses in front of potential customers and seeing if they would rent them.

“We could have spent months building a website and negotiating with designers,” Fleiss explained in a later interview. “But we realized the fastest way to test our idea was to simply get some dresses and see if women would rent them.”

The Unscalable Beginning: The First Harvard Trunk Show

In November 2008, Hyman and Fleiss executed their first experiment. They rented a room on Harvard’s campus, borrowed about 100 designer dresses, and invited female students to come try them on. The setup was simple: racks of dresses, a few makeshift dressing rooms, and the two founders ready to gauge reactions and collect feedback.

The event was deliberately designed to test multiple aspects of their business model. They wanted to observe how women interacted with the dresses, whether they were comfortable with the rental concept, and what price points seemed reasonable. They also wanted to understand the logistics of handling, cleaning, and maintaining the garments.

“We literally stood there with a clipboard and asked women questions as they tried on dresses,” Hyman recalled. “We asked if they would rent the dress, how much they would pay, and what occasions they would rent for.”

The response was overwhelmingly positive. Women were excited about the opportunity to wear designer dresses they couldn’t afford to buy outright. Many expressed enthusiasm about the concept and indicated they would be willing to pay roughly 10% of the retail price to rent a dress for a few days.

This initial trunk show provided valuable validation, but the founders knew they needed more data before committing fully to the business. They decided to expand their testing to other college campuses.

Expanding the Experiment: Campus-to-Campus Trunk Shows

Over the next few months, Hyman and Fleiss took their trunk show on the road, visiting women’s colleges and universities throughout the Northeast. They would pack up dresses, drive to a campus, set up a temporary showroom in a sorority house or campus building, and invite students to come try on dresses.

These campus trunk shows were labor-intensive and time-consuming. The founders personally transported the dresses, set up the displays, managed the try-on sessions, collected feedback, and handled the return logistics. It was a process that couldn’t possibly scale to thousands or millions of customers, but it provided invaluable insights that would shape their business model.

“We’d literally be in the back of a car with 100 dresses, driving from campus to campus,” Fleiss said. “It was exhausting, but we learned something new at every event.”

At each trunk show, they refined their approach based on previous learnings. They experimented with different dress styles, price points, and rental terms. They observed which dresses generated the most excitement and which ones women were willing to pay more to rent. They also began to understand the operational challenges they would face, from inventory management to cleaning and repairs.

The campus trunk shows also helped them refine their target market. While they had initially envisioned their service appealing primarily to working women in their 20s and 30s, they discovered significant enthusiasm among college students, who had frequent formal events like sorority functions and campus galas but limited budgets for designer clothing.

Building a Community: Word-of-Mouth Growth

One of the most valuable aspects of the campus trunk show approach was its ability to generate word-of-mouth buzz. Each event created a group of enthusiastic early adopters who would tell their friends about the concept. This organic growth was particularly powerful in the close-knit college environment, where news of an innovative fashion service spread quickly.

“College women are incredibly social and connected,” Hyman noted. “If one woman in a sorority had a great experience with us, she’d tell all her sisters. Before we knew it, we’d have dozens of women from the same house signing up.”

The founders encouraged this word-of-mouth promotion by offering incentives for referrals and by creating Instagram-worthy moments at their trunk shows. They set up photo areas where women could take pictures in their rented dresses and share them on social media, extending the reach of each event far beyond the attendees.

This community-building approach helped Rent the Runway develop a loyal following before they had even launched a website. By the time they were ready to scale beyond in-person events, they had a waiting list of eager customers and valuable insights about their preferences and behaviors.

Gathering Critical Data: Beyond Just Validation

While the primary purpose of the campus trunk shows was to validate their business concept, Hyman and Fleiss were also collecting crucial data that would inform their future operations. They meticulously tracked which dresses were most popular, which sizes were in highest demand, and which designers generated the most excitement.

They also used the trunk shows to understand the logistics of the rental process. They learned about the wear and tear dresses experienced, how to efficiently clean and repair garments between rentals, and how to manage inventory across multiple events.

“Every dress had a story,” Fleiss explained. “We knew which ones came back with makeup stains, which zippers broke most frequently, and which fabrics held up best to repeated wearings. That data was invaluable when we started scaling.”

The founders also used the trunk shows to test pricing strategies. They experimented with different rental rates, security deposits, and rental durations to find the sweet spot that maximized both customer satisfaction and business economics.

This data-driven approach set Rent the Runway apart from many fashion startups, which often relied more on intuition than on hard data. By the time they were ready to launch their online platform, they had detailed information about customer preferences, operational challenges, and financial models—all gathered through their unscalable trunk show approach.

Securing Designer Partnerships: Proof of Concept

Another critical challenge for Rent the Runway was convincing high-end designers to participate in their rental model. Many designers were initially skeptical, concerned that rentals would cannibalize sales or dilute their brand exclusivity.

The campus trunk shows provided valuable evidence to counter these concerns. Hyman and Fleiss could show designers that their target customers—primarily college students and young professionals—weren’t in a position to purchase designer dresses outright. Rentals weren’t taking away sales; they were introducing new customers to luxury brands they might purchase from later in life.

“We could tell designers, ‘Look, here are hundreds of women who tried on your dresses and loved them, but would never have been able to buy them,'” Hyman said. “We were creating brand awareness among future customers.”

The founders also used the trunk shows to demonstrate that they could handle designer garments responsibly. They developed protocols for cleaning, repairing, and storing dresses that preserved their quality and extended their lifespan. This attention to detail helped alleviate designers’ concerns about how their creations would be treated.

By the time Rent the Runway was ready to launch formally, they had secured partnerships with over 20 designers—a significant achievement for a startup in the notoriously exclusive fashion industry.

From Trunk Shows to Technology Platform

In November 2009, approximately one year after their first campus trunk show, Hyman and Fleiss launched the Rent the Runway website. The platform allowed women to browse dresses online, select their preferred rental dates, and have garments delivered directly to their homes.

While this digital approach was far more scalable than in-person trunk shows, the founders continued to incorporate elements of their early strategy. They maintained a focus on community building, encouraged customers to share photos and reviews, and used data to refine their offerings continuously.

They also continued to host pop-up events on college campuses and in urban areas, recognizing the value of in-person experiences even as their digital platform grew. These events served as marketing opportunities, customer acquisition channels, and ongoing sources of feedback.

The combination of digital scale and personal touch proved powerful. By 2011, just two years after launch, Rent the Runway had grown to over 750,000 members. By 2019, the company had achieved “unicorn” status with a valuation exceeding $1 billion.

Lessons for Entrepreneurs: The Value of Unscalable Beginnings

Rent the Runway’s journey from campus trunk shows to billion-dollar business offers several valuable lessons for entrepreneurs:

1. Test core assumptions directly: Rather than relying on surveys or market research, Hyman and Fleiss put actual products in front of potential customers to see how they would react. This direct approach provided more reliable data than hypothetical questions could have.
2. Embrace labor-intensive early processes: The campus trunk shows were time-consuming and couldn’t scale, but they provided insights that would have been difficult to obtain through more efficient methods. Sometimes, doing things that don’t scale is the fastest path to learning.
3. Build community from day one: By creating memorable experiences at their trunk shows and encouraging word-of-mouth promotion, the founders built a loyal community that would support their growth when they launched more broadly.
4. Collect data obsessively: Hyman and Fleiss didn’t just use trunk shows for validation; they gathered detailed data about customer preferences, operational challenges, and financial models that would inform their future decisions.
5. Use early traction to overcome industry resistance: The evidence gathered from trunk shows helped the founders secure designer partnerships that might otherwise have been unattainable for a startup.

The Legacy of Rent the Runway’s Campus Trunk Shows

Today, Rent the Runway has evolved far beyond its origins in college campus trunk shows. The company offers subscription services, has expanded into everyday clothing and accessories, and operates physical stores in major cities. It has raised hundreds of millions in venture capital and gone public on the NASDAQ.

Yet the influence of those early, unscalable trunk shows remains evident in the company’s approach. Rent the Runway still emphasizes community building, still collects and analyzes detailed data about customer preferences, and still maintains elements of the high-touch service that characterized its beginnings.

The company also continues to recognize the value of college campuses as both a market and a testing ground. In recent years, they’ve returned to their roots with campus ambassador programs and university-focused marketing initiatives, acknowledging the special place that college women hold in their origin story.

As Jennifer Hyman reflected in a 2020 interview: “Those first trunk shows on college campuses were exhausting and completely unscalable. But they taught us everything we needed to know about our customers, our operations, and our business model. Sometimes you have to do things that don’t scale to build something that can.”

Rent the Runway’s story serves as a powerful reminder that in the early days of building a business, the most valuable insights often come from direct, personal interactions with customers—even if those interactions require founders to pack dresses into a car and drive from campus to campus, one trunk show at a time.