The Drop

curated insights: fashion, tech, beauty, wellness and biz

Suad Fakih

Nov 24, 2024

🌟 fashion🌟

Challenger Brands: Thriving Amid Challenges

Bain Capital reported a staggering statistic: luxury companies lost 50 million customers in two years.

WHAT!?

It’s no secret that the fashion industry has faced enormous challenges lately.

However, where some see obstacles, entrepreneurs see opportunities.

Enter Polène Paris, a perfect blend of heritage, craftsmanship, and millennial magnetism.

polene_paris

A post shared by @polene_paris

Polène carved out a niche with minimalist aesthetics, fair pricing, and European craftsmanship by positioning themselves between high-end luxury and uninspired mass-market brands.

But their real superpower? Social media. With 2.3M Instagram followers and 18M views on their hashtag, Polène built a digital-first strategy that turned their bags into status symbols.

The result? Explosive growth, hitting €143M in revenue in 2023 and doubling YoY.

In simple terms, how is it thriving?

AI x Fashion: Social Listening in Action

Okay, let’s shift gears to something game-changing: AI in fashion.

Imagine having a crystal ball that tells you exactly what your customers want before they even know it.

Yes, you heard right.

That’s the magic of social listening powered by AI.

Tools like Sprout Social, Brandwatch, and Talkwalker sift through mountains of data to:

Reveal customer sentiment.
Track emerging trends.
Predict what’s next.

For example, a brand might notice an AI-flagged surge in retro styles. With this insight, they could design and launch a collection just as the trend peaks.

AI makes social listening more than just hearing; it’s about understanding and leading the conversation.

🪷beauty, wellness & venture capital🪷

This week, I met a UK-based entrepreneur redefining beauty and wellness.

Her story began with her mother’s health struggles, which inspired her to create a science-backed, high-performance product, a journey three years in the making.

But she didn’t stop there.

It took another year to:

Perfect her packaging.
Identify her ideal customers (high-conscious, high-spending individuals).
Run dozens of pop-up shops to gather valuable customer insights.

Here’s the kicker: she has no website. All her orders come through email.

Now, she’s gearing up for her first seed round next year. But like many founders I work with, she asked:

"Why does every VC want $1M in ARR before investing?”

VC asks for this as a benchmark for investment. It indicates a certain level of market validation and scalability.

But bear in mind that not every venture is equal.

What about fundraising in tough times?

Let’s be honest: raising funds is hard, especially right now.

Here’s why:

Tight capital markets.
Inflation and high interest rates.
Stricter retail gatekeeping.
Cutthroat competition.

Aside from the market dynamics, other aspects might hurt a founder’s raise.

Some founders often struggle to tell their stories powerfully while successfully highlighting their unique value proposition.

Believe it or not, these are usually make-or-break moments.

But also remember: 🤫

"Never build a company for a VC. Build it to provide value to customers." — Harry Stebbings

So, inspired by Rachel Brown’s fantastic article, Has The Small Beauty Brand Explosion Imploded?, in Beauty Independent, I’ve created an easy-to-digest graph highlighting what VCs see as challenges and opportunities for founders like you.

Understanding VCs' perception of the industry can help you, as a founder, better prepare to address the $1M ARR question.

🤖tech🤖

HURR and Deliveroo Partner to Shake up the Fashion Rental Game

Imagine renting a designer outfit from HURR and having it delivered to your door within hours. That’s exactly what their new partnership with Deliveroo offers.

This partnership is a step toward making sustainable fashion effortless and exciting.

This innovative move makes sustainable fashion more accessible and exciting. It reminds me of the Colombian app Rappi, which has been delivering groceries, beauty, and prescription products for years.

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Mile: The pumped version of sample sales?

If you love NYC sample sales, you’ll adore Mile—a members-only club offering luxury fashion pieces at up to 90% off.

Here’s how it works:

Exclusive access to archival collections from brands like Off-White and Brunello Cuccinelli.
Direct partnerships with over 100 luxury brands.
Tailored access levels for members.