Personalisation has been the norm lately but to personalise in such a manner that the user feels autonomous is highly difficult to do. Stitch brings the service directly to our homes. We always needed a service which can adapt to individual lifestyles of every man and woman. As our needs change so does our styles, tastes, perspectives, and outlooks. Stitch fix has managed to grab this methodology and provided us with an affordable service. In this spotlight, we will be discussing what Stitch fix actually do and how it does it.
Search for Right kind of Clothing
To help find people the right kind of clothing for a certain point in time is the mission of Stitch. Right kind of clothing is always difficult to choose. We always ask our loved ones to tell us how we look when we are going out, or just sitting in. This is the basic instinct that we as humans have. And sometimes we wear something and ask the same question but if the answer is “you don’t look that great!” then we go to the wardrobe to find the other piece. But many times that special piece is not in our wardrobe. So Stitch says that they send you a host of dresses with personalized styles and if you find the one matching, you take it. And the rest can be returned back to Stitch. Now, this is something really unique.
Whether you are a petite one, in a maternity situation, a women with special choices (odd or even it’s up to you), a plus size one, or you are after premium brands, Stitch tries to fit in. There are more than 250 brands from which we can choose to buy.
It is a luxury to ask an expert to help with the outfits. It is a kind of luxury which takes us mostly out of our homes. Stitch has come up with an idea in which they can provide the personalisation based on the expert opinion relevant to us while ordering. This curation is really important because we all love to think that what we wear is actually a piece of art acknowledge by an expert artist or stylist. The other aspect of not having an expert at hand is that if we want to get an opinion of a stylist it takes time to get one. So if some shop or service let us reduce the time to getting a right opinion on personalisation then that service is really unique. Stitch works with thousands of stylists from the USA. And they are fast expanding.
Founder of Stitch
Katrina Lake created the concept and founded the Stitch Fix. Katrina Lake is always looking towards things which can make women feel confident. She is highly client focused perhaps just like Jeff Bezos. Katrina has an impressive resume and she has been working with Polyvore, and the Parthenon Group, in the past. She has been an investor from Leaders Ventures as well. She has done BS Economics from Stanford, and an MBA from Harvard Business School.
Three Step Process
Stitch allows us to create our profile. This profile tells our tastes and inklings. You can then share this profile with your personal stylist. In the second step, the stylist chooses 5 pieces of clothing for you, and send them over. When they are at your home, you can try them on. Get further opinions from your loved ones, and then in the third step you return what you don’t want and keep what really want. It becomes so simple, but it was a complex notion to grab on in a business perspective. Stitch provides 3 days in which you can decide which items to return. 3 days is hell lot of time to get an opinion from our loved ones ;). 20$ styling fee is applied on what you buy, and if you buy all 5 of them then you get to have 25% discount (on the entire collection).
Let’s see the tech scene
If you are not a tech person you can skip this section :D. Stitch development team uses Git, Github, CircleCI, BugSnag, DataDog, Slack, their own personal tooling called fixop.It uses Google Docs for collaboration among the team members. You can see some of the toolings at here as well.
You can find the revenue growth on this page https://infogram.com/untitled-1gqo2qnxn4w7278
These figures look promising, perhaps this is the reason they are going for an IPO. As of writing, the current valuation is $2 Billion. They are going to release Class A Common Stock with 10Million shares. You can see the complete information on this SEC filing
Here is scalability information from them
“We have scaled our business rapidly, profitably and in a capital-efficient manner, having raised only $42.5 million of equity capital since inception. We have achieved positive cash flow from operations on an annual basis since 2014, while continuing to make meaningful investments to drive growth. In 2015, 2016 and 2017, we reported $342.8 million, $730.3 million and $977.1 million in revenue, respectively, representing year-over-year growth of 113.0% and 33.8%, respectively. We had net income of $33.2 million in 2016 and a net loss of $0.6 million in 2017, and reported $72.6 million and $60.6 million in adjusted EBITDA in 2016 and 2017, respectively. As of August 1, 2015, July 30, 2016 and July 29, 2017, we had 867,000 active clients, 1,674,000 active clients and 2,194,000 active clients, respectively, representing year-over-year growth of 93.1% and 31.1%, respectively. See the section titled “Selected Consolidated Financial and Other Data—Non-GAAP Financial Measures” for information regarding our use of adjusted EBITDA and its reconciliation to net income (loss) determined in accordance with U.S. generally accepted accounting principles, or GAAP.”
Stitch Fix is a great innovation, which uses real experts coupled with data science to provide impressive personalisation service to its clients. It is fast increasing in growth, and we would like to see more of it in other parts of the world.