Dec. 6, 2021

How thredUP Is Transforming Online Thrift Shopping

James Reinhart, co-founder and CEO of thredUP, chats with Nora and Scott about building and managing the online consignment and thrift store, and taking it public. They also talk about how cultural attitudes towards thrifting have shifted in recent years, and the environmental impact of thrifting vs. buying new.


Plus: Why it takes so much water to make one pair of jeans

Transcript

Nora Ali: Over the past few years, consumer preferences have shifted in favor of sustainability, and fashion is no exception. According to the BBC, the global fashion industry accounts for eight to 10% of global carbon emissions and nearly 20% of wastewater. As the global effort to reduce emissions continues, thrift shopping has made a comeback, but this decade it's all online. Co-founder and CEO, James Reinhart is leading the charge with his company thredUP, an online marketplace where you can buy and sell high quality secondhand clothes at a discounted price of up to 90%. Reinhart joins us today to discuss his journey building thredUP. He'll tell us about how cultural attitudes towards thrifting have shifted, thredUP's impact on the environment, and how thredUP has changed the game for all clothing retailers interested in secondhand resale. From Morning Brew, this is Business Casual, the podcast that gives you a front row seat to candid conversations with some of the biggest names in business, asking them the questions you wish you could ask. I'm your host, Nora Ali.

Scott Rogowsky: And I'm your other host, Scott Rogowsky. Nora and I are here for your ears, bringing you stories of how business shapes our lives today and into the future. Now let's get down to business. So, Nora, I learned something about you in our conversation today with James Reinhart, I learned that you used thredUP when you moved, you actually cleaned out your closet using thredUP. But now that we're not talking to James anymore, give me the real scoop. How much money did you make? How easy was it? Would you do it again?

Nora Ali: It was so easy. I was shocked at how easy the experience was. I just got some of their bags sent to my door, stuffed them full of clothes and shoes and just sent them right back. And I felt a little bit guilty because I sent so much stuff, but I know that the stuff that doesn't get sold, they have a charitable program, it gets donated, everything's fine. But I didn't get that much back for the clothes that I sent. It was maybe $40 of credit that I got to use on thredUP for literally five bags of clothes. But it was a moment of awakening for me because I did use to shop a lot on fast fashion sites, on Amazon. So a lot of my stuff isn't necessarily that resellable, but I got to tell you, it really helped me clean out my closet. I don't know what else I would've done. But what is your experience with reselling? And I know you have a long history with vintage attire, especially.

Scott Rogowsky: No, I've never used thredUP because they don't cater to my kind, men.

Nora Ali: And there's a reason for it, which we heard from James.

Scott Rogowsky: Yes. There's a good reason, I guess. Look, I've been early on the reselling trend. Back in 2003, I contracted a high school classmate of mine to create a website for me, because I didn't know how to do that. And he created retrorags.com where I was selling vintage t-shirts that I was thrifting for a dollar... I did sell one shirt off the site.

Nora Ali: Okay.

Scott Rogowsky: One shirt sold and I was very happy that one sold.

Nora Ali: That's pretty good.

Scott Rogowsky: Yeah, it proved that I had something, I should have kept up. But the point is, I've been doing this for a long time. I've been thrifting for a long time and I believe that there is something here, and I've seen it firsthand how the market has exploded in the past couple of years with the pandemic, especially you saw record prices for t-shirts. There was Aladdin t-shirt that sold for $6,000-

Nora Ali: What?

Scott Rogowsky: ...that made headlines last year. It's funny how, when I was shopping for vintage in the early 2000s, the '80s were, that's what you want, right? You wanted '80s clothing because that was vintage. And now it's even late '90s, early 2000s, like Justin Bieber shirts and Miley Cyrus, Hannah Montana shirts are hot. It's unbelievable.

Nora Ali: Is that vintage now? Oh my gosh.

Scott Rogowsky: That's vintage now.

Nora Ali: Oh wow. Okay. Great. Well, I'm sorry it didn't work out for you long-term, but it did work out for James Reinhart. He did something right. So here's our conversation with the CEO of thredUP, James Reinhart.

Scott Rogowsky: Congratulations on this big year for the company. I know it's been a long time coming. Imagine it's March 26th, 2020, I was in my apartment, launching my lockdown talk show from my little desk in my bedroom there, my studio in Chelsea, we were all locked down. March 26th, 2021, IPO for thredUP. Did you think a year on from the lockdown, you'd be able to get your company up and running with an IPO like that?

James Reinhart: No. The beginning of the lockdown I'm like, "Man, is the world going to end?" And, then, a year later to have that great event, it's so surreal.

Nora Ali: Before we talk a little bit more about your IPO and your public debut this year, let's level-set on what thredUP is for those who aren't familiar. So I've used it before when I was moving out of my apartment. I imagine that's a big use case for you guys, is when people moving out, they want to get rid of a bunch of their stuff.

James Reinhart: Yeah.

Nora Ali: But what is the seller experience from beginning to end, if they decide to use thredUP?

James Reinhart: We've tried to build ourselves as the most convenient place to clean out your closet. And so that could mean that you're moving. It could mean that you're getting a new job. It could mean that you're pregnant and have to change your wardrobe. So you order a bag on our website. It's a big old plastic bag, it holds like a laundry basket worth of stuff. And you fill it with all the items that you're no longer wearing. It has a prepaid label on it and you just leave it wherever your mail gets picked up. So depending on where you live, sometimes that means you can leave it on your doorstep, you can leave it in your building. Sometimes that means you take it to the post office or FedEx. We then pick it up and take it to one of our facilities around the country. We go through all the things that you have sent us and are no longer wearing. We put it all online based on its condition. And then as those items sell, we pay you out on consignment. So it's quite easy for the seller.

Nora Ali: It's easy for the seller, but I imagine it's quite difficult on your end because you're receiving so much volume. I admit I sent maybe five or six bags of just stuff to thredUP. But how capital-intensive is that? And what are the biggest costs as your employees are manually going through all these bags and bags of clothes?

James Reinhart: Yeah. I wouldn't characterize it as capital-intensive, but it does require capital. You have buildings, you have people, you have processes. But the biggest thing that we have done to make the scaling of it work, is just all the systems behind the scenes to help with photography, to help with pricing, to help with inspection. And so if you walk through our facility, it would feel Willy Wonka-ish. There's carousels and conveyors moving stuff around, people are using computers and iPads and mobile devices. And so, everything that we've built in the backend is to make it easy to go through those five or six bags full of stuff as efficiently as possible. But it was not something that launched fully formed from our heads, right. It was a lot of process improvement and iteration over time.

Scott Rogowsky: Yeah. Just catch us up again on how it is right now, because there's these resale places where you bring your clothes to these brick-and-mortar locations. They have people sorting through it, pricing it out. You get paid and there usually are a lot of lines and you have to wait. It takes a long time for these people to sift through your clothes. So just on your end, how do you do that more efficiently, and there's so many things to consider? Their conditions, their sizes, their brands, because you differentiate between your value- and mall brands, your designer and premium brands. So the people who are sifting, and I assume it's people, or maybe you've got some AI machines scanning these things, but they have to know what this brand name is and why OVO Drake's brand is worth something versus Alfani the Macy's brand, which may not be?

James Reinhart: What's interesting is, part of the way you described your experience is exactly like how I started the company, because I went to sell my stuff and the people that I was selling it to, they were like, "Oh, we don't take stuff, we just do luxury." And I actually remember the experience so vividly because, and maybe you experienced this, it feels really judgey in the moment, right? You have something just like-

Scott Rogowsky: It's insulting.

Nora Ali: Yes.

James Reinhart: .."Oh, look what we have here. Somebody went shopping at..." And that in-person buying experience can make you feel really sad as a seller. And so it's funny to hear you describe your experience, because I had a flashback to my founding moment. But, to your point on the processing piece, we do have a lot of machines and we do use a lot of AI. We've built a lot of algorithms because we can then input the brand and take photos and we can use the technology to say, "Hey, that Alfani item from Macy's, if we're going to accept it, we're going to have to price it like this." So if that item is not in amazing condition and it's not a jacket, for example, chances are, we probably can't accept it. So we use all of our data behind the scenes to figure that out. Whereas in a brick-and-mortar format, they're relying on professional retail associates to make those calculations. And what we've learned is that the data is way more powerful. And so we've now processed 125 million unique pieces of clothing. And so every time we touch an item, we are feeding that through the data set. And not only are we able to make better decisions, but our data gets smarter every day. So I think people tend to underestimate that about thredUP. They think about us like an apparel company, but we're really a logistics infrastructure data company that happens to sell clothing online.

Nora Ali: So it would be pretty hard for a new player to come in and be as efficient as you guys, because they don't have all the data that you guys have.

James Reinhart: The data's really, really powerful because you know what, there's no barcodes on clothing.

Scott Rogowsky: Yeah.

Nora Ali: Yeah, yeah.

James Reinhart: Right. So you have to build a data set.

Scott Rogowsky: You build custom machines that spread open a shirt, that can zoom in on the tag. I was like...I'd love to come visit your facility because I want to see these robots or machines. You're feeding theses on conveyor belts.

Nora Ali: The Willy Wonka factory.

Scott Rogowsky: Yeah. But how are they determining the sizes and the brands?

James Reinhart: We definitely have people who open the bags and take out the items. But incrementally, what we're doing is, once the item is out of the bag, we can then start to hit it with cameras, right? And we can use those cameras to learn attributes about the item. And so, depending on where the types of items and the types of categories that we're processing, we can use our technology in a more robust way. There's still lots of humans, there's still opening bags. But I think what it suggests is that over time, we'll be able to automate more and more processes. But the hardest thing actually is inspection. And if you think about it, teaching a computer what acceptable pilling is, is a really hard thing.

Scott Rogowsky: You got to have the depillers. Yeah. I got my depiller here and I'm constantly doing that to my sweaters.

James Reinhart:

There's some nuance in the inspection process that I think people tend to be a little bit better than the machines are today, but I'm not sure that, that's true over say 10 or 15 years.

Nora Ali: It seems like the ultimate power of the state of this technology is that you can partner with larger retailers and offer what you call resell as a service. So your website notes that thredUP is powering resell for some of the world's leading fashion retailers and brands like Walmart, Madewell, and Reformation. Tell us a little bit more about how you partner with these retailers and why it's advantageous for them to partner with you versus building their own resale infrastructure. Because a Walmart, for example, surely has the capital to do so, but they've chose not to.

James Reinhart: We just talked about on our last earning call that we now have more than two dozen paying RaaS customers, resell as a service customers, and they pay us and they work with us because I think there's a few things going on at these brands and in the executive offices, which is, I think they've come to realize that the resale industry is growing fast and it's not a fad. And so I think a lot of retailers are starting to develop this point of view, that it is a big and growing channel. The same way you have online and you have stores and you have wholesale and you have off price and you have outlet, resale is a channel. And so, many of these folks are now realizing, "Okay, this is actually a big channel that I need to invest in or have a point of view on." And so then it comes down to, "Okay, well, what's the best way for me to get into this, to serve these customers?" And that's where thredUP really sits because it's our technology that can enable this for them. And so on the clean-out kit side, you mentioned Reformation or Athleta is a brand that we're proud to work with, Madewell. And you can pick up a clean out kit right in their store or you can get it online and then you send it to us. We process all those goods the way we process anything else, and then we can put those items online in a verified resale shop. So Madewell is a really good example where we now power this resale shop for Madewell, where everything is inspected and certified by ThredUP, but then sold directly on Madewell.com's resale shop. And so I think that's like the powerful loop of being able to clean out, gather supply, and then sell it directly online.

Scott Rogowsky: Yeah. You're just keeping this clothes loop going of Madewell sells something to somebody in their store or they buy it online and they wear it, they get rid of it, they resell it through thredUP, and it goes back into Madewell's secondary site.

James Reinhart: Exactly.

Scott Rogowsky: That's fascinating. So you're saying that this is a trend and it's here to stay and it's clearly growing. And we can tell because online resale, especially around clothing, has rapidly become a very crowded marketplace. I've long used eBay and Etsy and their's Facebook Marketplace and Mercari, but yours was among the first back in 2009, but there's also Poshmark and Grailed and Depop, The RealReal, Tradesy, Style Alert, Vestiaire Collective in France, en français. So how does thredUP differentiate itself when it is such a crowded marketplace? Is it really coming down to this clean out your closet mode?

James Reinhart: Yeah. I think there's really three well-developed lanes now, that's how I think about it. There's the peer-to-peer lane. So I think as you mentioned, the Poshmarks, the Depops, Mercaris, this is the next generation of eBay, right? So you sell your own things online, you sell it to a buyer, you coordinate directly, the platform takes the fee. Then I think there is the manage-marketplace model, which is, I think where we sit, we do all the work for you. We make sure that the selling experience is great. We make sure the buying experience is great. We're the people who take the returns, we're the customer service. And so you really create a more trusted marketplace-like experience. But what comes with that is the infrastructure investments that we talked about, the technology. And so, the manage-marketplaces are a little different. And so once you have this point of view on a manage-marketplace, then it's ultimately about price point. And so you mentioned RealReal or Vestiaire and they're very luxury, whereas thredUP, while we sell luxury items, we really focus on everyday apparel and we sell 35,000 brands, 100 categories. It's a platform for everyone.

Scott Rogowsky: Except men.

James Reinhart: Except men.

Scott Rogowsky: What's up with that?

James Reinhart: We can talk about that.

Nora Ali: Well, we should because that's where you started, right? You started with men in the very, very early days, decided not to go that way.

James Reinhart: Trust me. The irony's not lost on me. Yes, yes, yes. Give me one second and I'll come back to you because I think it's an important piece for your listeners. And so where we sit in this mass manage marketplace, we think is actually the biggest market. It's also the hardest, but then it's actually not as crowded, Scott. So that market, there isn't a lot of competition there because of what we've built in the space. And so that's how we think about that market dynamics. The point about men's is a funny one because I get asked this all the time, even at my own company all hands. When you look at the data, the men's market, it's just so much smaller in resale than the women's market. Men make up probably 10, 15% of the broader resale market, women make up 80 and then kids is some remainder in there, and it comes down to a few things. One, men, we tend to wear out our clothes more. So by the time they're ready to get into... We're filthy animals, Scott, let's be honest, we're filthy.

Scott Rogowsky: Yeah. Yeah. My holey shirts.

James Reinhart: And so we wear them out. That's one problem. And then the second is, we tend to wear the same four or five colors, blue, black, brown, gray. And so you end up with this, oh, one blue shirt for another blue shirt, not sexy. And so those are the two driving reasons for men's, whereas women, they love things in lots of colors and they don't wear it as often.

Nora Ali: There's value in knowing which markets you don't have to go after. So I think that's a good lesson. We are going to take a very quick break, but when we come back, we'll talk about the environmental impacts of fashion and how thredUP is helping to combat that. We'll be right back.

[AD BREAK]

Nora Ali: So, James, let's get to the environmental aspect of all of this. According to thredUP's 2021 Fashion Resale Report, 36 billion clothing items are thrown away in the US each year, 95% of which could be recycled or reused. So can you put into context the negative impact that the fashion industry has on the environment?

James Reinhart: Yeah. The fashion industry is just terrible, and honestly there's no other way to describe the impact of the fashion industry on the environment. It's terrible, and I think it's one of those things that has flown under the radar until the past few years of just...the cost of fast fashion, the cost of us wanting to have the newest thing, is really starting to take its toll. And I think the fact that in the US we're putting so much in landfills, and that we're giving away so much product every year, I think it just speaks that we have an overproduction problem. And on the water consumption alone, it's like 2% of the water consumption that it takes to produce a new item, to produce a used item. And so when you look across carbon, electricity, and water, secondhand is really the best thing that we can do. And that's not just me being self-serving, the data speaks for itself. We need to figure out how to produce less stuff.

Scott Rogowsky: And this data is from thredUP's 2021 Resale Report, which examines the environmental benefit of the secondhand market. So, you must know these things better than the average person because you're in it. Tell us, for example, why jeans take so much water to make and the environmental impact of manufacturing, where actually does it lay in the process?

James Reinhart: It's everything on the water side is the cost of harvesting the cotton to managing the dye wash, the dyes that we're using on these jeans and the wastewater that's involved. If you imagine, it's like the equivalent of, if you've ever baked, and you have the color dyes. They're so concentrated and you need to dilute them. And so when you dilute them to dye denim or to dye shirts, it's a bath of water with a dye product. There are companies that are doing innovative things to reduce that type of water consumption, but you're harvesting cotton and like cotton grows. It requires water. It's an industry that's been around for a very long time, but I do think among young people in particular, you're seeing this transition.

Nora Ali: In your Resale Report, you talk about what the post-pandemic customer actually cares about, and maybe what has changed during the pandemic that includes sustainability and reducing waste, which we talked about. Consumers prefer resellable items over disposable items more than ever, and is also focused on saving money. And we know the reason many people shop fast fashion is to save money, but the impacts of fast fashion are antithetical to those other points around the environment. So given what you know now about the post-pandemic customer, what do you think is the future of fast fashion? Is fast fashion going to be dead pretty soon?

James Reinhart: Nora, you've hit on this really interesting dichotomy out there, right, around young people who want to save the planet and they're buying more stuff on Shein than ever before. And I think in our next Resale Report, we're going to have a whole section, because as a team, we're like, "God, how do we reconcile this?" And so we're doing a bunch of research now to figure out, how do young people think about this? Do they just give themselves a pass? Like, "Eh, well, it's just a little bit of what I buy." I don't honestly have a great answer, but I am worried that there's a lot of posturing out there. There's a lot of green planet emojis and also a lot of stuff that's being shipped overnight that doesn't need to be shipped overnight. And so I think you'll continue to see consumers be conflicted about this. And I think we're trying the best we can to educate people on the impact.

Scott Rogowsky: Is Shein one of the brands that you reject at thredUP?

James Reinhart: We've had this debate for a long time, Scott, where we're like, okay, well, it's already been produced. So is our response as a recycler or a reseller to put our head in the sand and be like, "It doesn't exist, we can't accept it." Or is it well, shit, it's already been made, we should do our best to give it another chance. And that doesn't mean that we don't want to fight against the cost of fast fashion, but I don't think the answer is to say, well, let's just let it go in a landfill.

Nora Ali: Well, it feels like thredUP sits in this sweet spot of being sustainably focused, but also low price, low cost for buyers. And I know thredUP has actually been lowering prices recently-

James Reinhart: Yes.

Nora Ali: ...to help customers afford items in a supply-constrained world right now where inflation is rising. And you said before that thredUP isn't really impacted by supply chain issues in the way that other retailers are, because your products are already made, they're ready to ship. So lowering prices generally doesn't mean good things for your margins. So as you're thinking about catering to these customers who are more constrained right now, how does that play into your path to profitability and how are you thinking about that overall?

James Reinhart: Yeah. Did we ever think we'd spend so much time all talking about supply chain? It's like when you have a supply chain conversation with your mom, you know things have really, really hit the mainstream media. I think in our case, we have less exposure to some of the supply chain challenges that companies have overseas. So the companies that are manufacturing overseas and they're airfreighting product, I think those types of challenges we don't have, because everything is here in the US and domestically sourced, so to speak. So because of that, we don't have quite the same exposure across all those categories. And so it gives us an ability to price more competitively. And I think what the team showed to me over the last few months is that we really took a data-driven approach of, "Hey, if we have some ability to lower prices, does that attract more customers?" And so it's a classic elasticity of demand equation around, you lower prices, you get more customers in the door. And so we ultimately think that the strategy of lower prices really pays dividends over time, because at the end of the day, having a lot more customers in the future is better than having a few bits of margin in the near term. And so that's the way we've made that trade-off. And so far we, we feel really, really good about it and feel good about where 2022 will be.

Scott Rogowsky: Have you considered having a purge-like day where, everything on the site is free for 24 hours, get them in, get them all in, James, crash the site, and then you jack up the prices next week?

James Reinhart: No, but I will tell you, and I won't tell you who told me this, but he's a great retail CEO. He was thinking about resale and launching a reverse cyber week. So instead of cyber week where you just acquire all this stuff-

Nora Ali: A cyber sale?

James Reinhart: ...you mean a reverse cyber sale. Yes. Cyber week, cyber sale, right?

Scott Rogowsky: Another break is coming up, so let's take it, and when we come back, we're going to do our best How I Built This impression with James Reinhart. Get the story of his founding into the journey that is the current publicly traded company.

[AD BREAK]

Scott Rogowsky: This is my favorite part of these interviews because I love the founding stories, and we touched on it a little bit earlier. You said you, you had your light bulb moment when you went to sell at one of those brick-and-mortar retail shops, and you got condescended to your pedestrian choice of clothing. They can just read T.J. Maxx all over you, James. You're a Kohl's guy through and through, but that's okay. I am too. You founded thredUP in 2009. Clearly you were a bit ahead of your time when you came up with this idea. What sparked your passion for this before the rest of the world caught on?

James Reinhart: I think in 2009, I was a student at the time and I didn't have any money because before I was in business school, I was a teacher and they don't pay teachers what they should be in this country. And so I didn't have any money and I had a bunch of debt and I went to sell my clothing at the local consignment store. And it's actually a funny story which you will appreciate. The store was called Second Time Around, which at one time had 20-plus stores across Boston and New York.

Nora Ali: I remember that, yeah.

Scott Rogowsky: Yeah.

James Reinhart: And they wouldn't take it because it didn't meet their luxury brand standards or maybe the stuff just wasn't good enough. But I remember vividly having a cashmere sweater and a Brooks Brother's coat in that bag and being like, "Man, this stuff has real value. There's a failure here that this stuff is just going to end up in a landfill." And that actually was the precipitating event. And I went and then talked to a bunch of my friends and asked what percent of the clothes in their closet they wore. And then the story has been told around just using that data to launch men's and things like that. I mentioned the Second Time Around thing because what's funny is, years later we had a chance to buy assets of that company. It went under and I had a moment where I'm like, "Shit, if you had just accepted my J. Crew sweater, you might not be in this position." So I had an immense amount of gratitude for the sales associate who told me that my stuff wasn't worth anything. I think my instincts on it were that there were something fundamentally wrong about out how the stuff was being priced. I thought it was a market failure there. And then I also was just thinking that, hey, this was a market that had not really gone onto the internet in any meaningful way since eBay. So, eBay, 90 launches in '95, now 15 years later, it's still eBay and Craigslist. There had been no real innovation. The iPhone had just been invented, Netflix and Spotify and Uber. Being in business school at that time, there was so much consumer disruption happening, I think it was just in the air. And I was like, "Look, what could we do in resale?" And that was the journey.

Nora Ali: But still, as is the case for most founders, you got a lot of nos at first. I was listening to a previous interview you did, and you said you were pitching to a lot of wealthy white guys who just really weren't the target demo. So what advice do you have for any listeners out there trying to launch own business where their product might not be fit for the investors that they tend to pitch to? How should they approach that?

James Reinhart: I think it took me a while to figure out that at the end of the day, you need to find people who are just naturally inclined to say yes, versus trying to convince the skeptics. I've never convinced the skeptic to say yes, ever. It's ultimately about convincing people who are like, "You might be onto something. Do I want to then do this, be on this journey with you?" And so it wasn't until I found Patricia Nakache at Trinity Ventures, and I remember her telling me, "I get this. How do you make money?" Her instinct was very different. It was, I get it, help me figure out how we can work together, versus, I don't have any idea what you're talking about, convince me I should care. And I think finding people who are naturally inclined to care has got to be the right strategy. But that's, it's easy to say now, it's hard at the moment to find those people.

Scott Rogowsky: Did some of that skepticism from investors stem from perhaps a general stigma around secondhand clothing?

James Reinhart: Oh, no question.

Scott Rogowsky: And thrifting because I experienced that back in high school, when I would go to the local Salvation Army thrift stores and my mother would say...Or rather friends would say, "What are you doing wearing these? Someone might have died in that shirt and now you're wearing it. That's so gross." It's like, "It's not gross. Put in the wash. It's clean, it's only..." So I never saw that, but I do know that that stigma exists.

James Reinhart: I totally agree, and I've even been on the side of the stigma back when I was in high school, like, "Why are you buying that?" I had a good friend of mine who, every time he would show up with a shirt that was secondhand, he wouldn't say, "Do you like my shirt?" He would say, "I got it for a dollar."

Scott Rogowsky: Yeah. Exactly. I got it for a dollar, that's part of the appeal too.

James Reinhart: I'm like, '"But it's ugly." He was like, "I got it for a dollar." But I'll tell you, that stigma still exists today. It still exists among public market investors. They don't necessarily get it, they don't shop secondhand. I still think we're not there yet, people really appreciating the opportunity in this market. But every day we felt we make a little bit more progress.

Nora Ali: And progress from the investor standpoint, too. Going back to the fact that you guys went public this year, a pretty impressive opening day, shares close about 40% higher than the IPO price. Did the public debut teach you anything about demand for thrifting, for reselling? Are investors bullish about this space and what more is there to convince those investors who are still skeptical?

James Reinhart: It was clear to me now that there is a big appetite among investors for truly disruptive retail plays. That's a word that gets thrown around a lot, but in a classic sense like disrupting how the supply chain worked, this had never been done online the way that we had built it. And so I think it proves that there are still big disruptive ideas in retail. Allbirds just went public, Warby just went public, like Rent the Runway. There are these businesses and it's funny, we all are similar vintages, not exactly the same year, early 2010s. So I think it proves to investors that there are some big winners out there, because for a little while there was skepticism around, can any of these companies really break out? So I think more than anything, it validates that there's real innovation continuing to happen in retail.

Scott Rogowsky: Do you find yourself as CEO feeling different pressures or thinking in a different way about strategy, now that you are this publicly traded company, now that you're responding, not just to your private investors, but now millions of people potentially own your stock in your company? What do you think about it on a day-to-day basis in this new structure?

James Reinhart: I feel like the IPO is unburdening for me, because when you are a private company and you're a founder, all these people have invested in you. Your venture capitalists, many people raise friends and family around. There's all this tied up, employees who stick with you and they can't sell stock. They can't generate any return on the investment of their time. And so I think as a private company, in some ways I was more like, "Man, I just want to give, I want to reward people for all the trust and faith that they've put in me." And so I think when we went public, there was a little bit of a "Huh," right? I've paid these people back for all of their courage to stick with me. And now I feel I can be even more ambitious because if people don't like the strategy or how I'm talking about the business, or they don't like me being on your podcast, they can vote with their feet. They're not stuck with me, and conversely people who hear about me for the first time on your podcast are just like, "Man, I like that guy. I want to own some of those shares." And that doesn't exist when you're a private company.

Scott Rogowsky: So you feel like you're more of a mascot now, is that part of it too?

James Reinhart: Yeah, people can respond and be like, "Oh, that guy's onto something. I want to be part of that." Or, "That guy's an idiot. I don't want to of that." And so I think it helps me be more transparent and more honest and more open with my ambition for what we're trying to do on the road.

Scott Rogowsky: All right. Well, James Reinhardt, it's been a pleasure chatting with you and hearing all about your journey and this industry, which I'm all for. I'm in support of it. Until you have men on the site, I guess because it's not part of the roadmap, I'll have to take my shopping elsewhere. But Nora and the rest of the women and mothers with children out there listening, give thredUP a shot. James, appreciate it. Best of luck to you as you move forward.

James Reinhart: Thanks guys. I really appreciate you having me on. Take care.

Scott Rogowsky: Hey, BC listeners, we've been getting some great feedback from you about our show. Keep sending us those emails because we want to hear from you. We're doing an episode about the Ultimate Last Minute Gift, the gift card. Where do you stand on GCs, BC? Are they the worst gift ever or are they your go-to? We want to hear it all. Send an email to businesscasual@morningbrew.com or DM us on Twitter @bizcasualpod, that's b-i-zcasualpod, with your thoughts, like your favorite restaurant is in Hong Kong.

Nora Ali: You can also leave a voice memo on our website, businesscasual.fm, or give us a call and leave us a message. Our number is 8622951135. As Business Casual grows, we are excited to get to know our listeners, old and new. Drop us a line, and don't forget to leave your name and where you're calling or writing from, so we can include you in a future episode.

Scott Rogowsky: Business Casual is produced by Katherine Milsop and Bella Hutchins. Additional production sound design and mixing by Daniel Marcus. Alan Haburchak is the director of audio at Morning Brew. Sarah Singer is our VP of multimedia, and Jessica Coen is our chief content officer. Music in this episode from Daniel Marcus and The Mysterious Breakmaster Cylinder. If you like what you heard, please follow Business Casual on Spotify, Apple Podcasts, or wherever you go for ear candy. And we'd love it if you would give us a great rating and a review, please.

Nora Ali: Thanks for listening to Business Casual. I'm Nora Ali.

Scott Rogowsky: And I'm Scott Rogowsky.

Nora Ali: Keep it business.

Scott Rogowsky: And keep it casual.