This hot $250 million start-up is being called J. Crew for Millennials
By Mallory Schlossberg
Everlane might be the next big thing in retail. This fall, Racked posited that the online retailer might become "the next J. Crew."
And now, Re/Code is reporting that Everlane is supposedly performing very well: Sources claim that the startup raked in roughly $50 million last year, and that it plans to make twice that in revenue this year.
Re/code also reported that Everlane could get another round of funding and that it's looking for a valuation that's bigger than $250 million. (Everlane has raised $18 million as of now.)
So why is Everlane so hot right now? It's got a few things going for it.
The core of Everlane is that it promotes transparency; it wears its ethics on its knit sleeve.
On its website, the retailer breaks down how much it costs to make its clothing (labor, materials, transporting the apparel, and duties). It compares its prices with those of traditional retailers. One dress, for instance, is $98 at Everlane, and Everlane claims traditional retailers would sell the dress for $190.
The transparency raises two points: it hones in on the idea of how consumers hate paying more than they have to, and it also appeals to young people's desire for socially-conscious brands
"64% of millennials would rather wear a socially-conscious brand than a luxury brand," Rachel Krautkremer, an editorial director for the creative agency Deep Focus, told Racked. "It's a shift in how this generation views their clothing. They want to know where their product is coming from."
As a part of this transparency effort, Everlane has a pay-what-you-want section on its website. In December, the company launched this initiative with a pay-what-you-want sale (the lowest price, of course, comes with a heavy dose of the shame for not helping the ethically-minded company).
Secondly, per Racked's arguments, Everlane seems to do what J. Crew has been failing to do as of late: give consumers quality basics. (J. Crew returned to basics in the fall, but third quarter sales proved that the apparel failed to resonate with consumers.)
Everlane's clothes are simple and claim to be of high quality.
"We make products that are timeless in look," Everlane CEO Michael Preysman told Racked in the fall. "The clothing has a current point of view, but can also be worn in 10 years. It's a very tricky thing to pull off. In our view, the best way to be environmentally sustainable is to create really great quality clothing that lasts and that has a lasting time stamp."
Despite the clear emphasis on basics, Everlane also aims to appeal to the fashion-forward set. The company has a well-known trendy fashion executive on its team, not too dissimilar from J. Crew's iconic Jenna Lyons. Everlane hired Rebekka Bay, who was ousted from the Gap despite having a fashion-forward reputation and previously worked at H&M, as head of product and design last year.