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Stitch Fix CEO Katrina Lake says her one regret with the IPO is that they let expectations get really high

“That made the $15 price feel disappointing when in reality it didn’t have to be,” Lake said at the Code Conference.

Stitch Fix CEO Katrina Lake, who took the company public in November 2017, says she was “absolutely disappointed” with the IPO price. That’s partly because expectations were too high.

“One element that I regret is that I feel like we let expectations get really high around pricing,” Lake said at the Code Conference in Rancho Palos Verdes, Calif. “For us, it didn’t matter. Our last priced round was in 2014 at like $300 million; we somehow let expectations around how valuable the company could be get high, and that made the $15 price feel disappointing. In reality, it didn’t have to be.”

Lake said that expectation came from potential investors and banks that didn’t know how to value the company.

“Stich Fix is an unusual company. We turn our inventory really fast, we’re really capital efficient,” Lake said. “In some ways we can look like a retailer, in other ways we look more like a technology company. There weren’t perfect comps for the business. Another learning is that there was more education and more trust building with investors.”

Still, Lake said taking the company public was the right thing to do.

It was definitely a choice, she said. “We were profitable, we didn’t need the capital at that time,” adding, “The best way for us to create long-term value was to have a public event.”

The company is still committed to remaining independent even in the face of possible competition from behemoth e-commerce player, Amazon.

“We definitely think about [Amazon] a lot,” Lake said. “They’re an amazing company. ... In terms of direct competition it’s just a fundamentally different problem. Part of the value proposition of Amazon ... is this sea of choice. It’s literally millions of things to choose from. Ours is almost the opposite: It’s we’re sending you five things.”

“Our value proposition is almost the opposite,” she said. “It’s not endless choice. It’s a very select group of things that we think are highly relevant for you. That discovery is sometimes the hardest part of apparel.”

Would Lake sell Stitch Fix to Amazon? She said she can’t say never because of her fiduciary duty to shareholders.

“We haven’t had any serious discussions about combining the companies,” she said.

“Right now we feel really confident on the path that we’re on,” she continued. “There’s still new businesses that we’re really excited about, so today we’re focused on continuing to create value for our shareholders and feel that this is a company that is really differentiated.”

Watch her full interview below.

This article originally appeared on

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