In 10 years, every “relevant” company will be a tech company, Stitch Fix CEO Katrina Lake says

Americans currently buy 80 percent of their clothes in physical retail stores. That’s going to change, and soon, says Stitch Fix CEO Katrina Lake.

“If you want to be relevant 10 years from now, every company is going to be a tech company,” Lake said on the latest episode of Recode Decode with Kara Swisher. “Airbnb is a hospitality company and Uber’s a transportation company and we are a retail company. But if you want to still exist in a decade, I think everybody’s going to have to be a tech company and figure out what is the thing that is going to be lasting about their company.”

The simplest way to describe Stitch Fix is probably as a “clothing recommendation company”; the company sends you a box of clothes and accessories you might like, and you pay to keep whatever items you don’t send back. Lake said that if retail stores want to compete with her company and others such as Rent the Runway, Revolve, and the RealReal (and, oh yeah, Amazon), they will need to think of the store as one part of a larger business.

“I hope that it’s not the end of stores,” she said. “I think the old version of what a store was is like it’s a place for a transaction: you come in, you find something, you pay for it. The reality is, e-commerce is almost always going to be quicker and faster.”

“So if your store is a transactional convenience-based play, I think it makes it really hard to compete against an Amazon,” Lake added. “I think there is a place in the world for stores, I think it’s just going to be very different than what we saw in the past.”

You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, and TuneIn.

Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Katrina.

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Kara Swisher: Hi, I’m Kara Swisher, editor-at-large of Recode. You may know me as the founder of a platform for mafia dons called Snitch Fix, but in my spare time I talk tech and you’re listening to Recode Decode from the Vox Media Podcast Network. Eric, that was the worst joke you’ve ever made so far.

Eric Johnson: Thank you!

Anyway, today in the red chair is Katrina Lake, the founder and CEO of Stitch Fix, one of my favorite startups, and I actually use it. It’s something I use. She started the company in 2010 and took it public in 2017. She’s also on the board of Grubhub and Glossier — and we’ve interviewed Emily on the podcast before. Katrina, welcome to Recode Decode.

Katrina Lake: Thank you for having me.

I don’t think you’ve been on Recode Decode.

I have not. This is my first time.

What is wrong with me? Something’s wrong with Kara Swisher for doing that. Let’s talk a little bit about you. You’ve been public for a while now, right?

Yes.

Couple of years.

Yep.

All right. I want to get to that. But let’s go into your background a little bit. People do know you, but let’s talk. You’re one of the few women CEOs and founders. We talk to VCs all the time about these issues and things like that. But talk about ... a quick and dirty of your journey.

The quick and dirty is that this is a space that I fell in love with. I looked around and said, lots of people are trying to transform all of these age-old industries, and retail is one of the oldest. And that this idea of how do I find jeans that fit me, or how do I find a dress that’s going to suit what I’m looking for? Those are still really hard problems to solve, and that there’s this huge migration of dollars from offline to online. Yet, I felt like the online tools weren’t actually helpful and trying to help people navigate that huge world of apparel.

Honestly, I didn’t know I’d be an entrepreneur. I just wanted to work for whatever amazing person was going to come on your podcast and talk about the future of retail. I spent a lot of time looking around trying to find a company to join. Ultimately, didn’t find anything that I wanted to join, but felt really inspired that if I imagined this world of retail that was different in the future, that I could start it on my own.

I had a wandering journey to figuring out how I could be an entrepreneur myself. I went to business school thinking that would be a risk-reduced way for me to start a company and start it while I was in school.

You needed that MBA.

I don’t know if I needed it, but I needed that time, honestly. I needed that two years to work on it and feel like I wasn’t failing. Worst-case scenario, I’d have an MBA. My goal was to ...

What did you have right before this? Before Stitch Fix.

Before Stitch Fix, I was doing my MBA. Before that, I worked at a venture fund called Leader Ventures. That was part of this thread of maybe I can find the future of retail, and did a side project for this guy Charlie Graham who’s had his company called Shop It To Me, which is still around. That reinforced that I love this space.

But I went to business school with the goal of, I want to graduate with a company off the ground, pay myself a salary, paying back my student loans. That if I wasn’t able to do that, I’d have an MBA, but that was my goal. I was lucky enough to meet Steve Anderson in my second year.

Steve Anderson is at Baseline Ventures.

At Baseline Ventures, exactly. Actually, Sukhinder Singh Cassidy, she was a mentor of mine, and she was the very first ...

Google executive.

Exactly, and then she was the very first check. Then Steve agreed to do the angel round. When I graduated, we were kind of off to the races.

You had, I’m not saying an easy journey, but you got funded pretty quickly, and the company got up and running relatively quickly in terms of ...

The angel round, yes.

Yeah. Talk about the journey from that to going public. Because you’re one of the few companies that’s also gone public.

That’s right.

And retail is also an area that’s actually done rather well. We just had Julie Wainwright take RealReal public, we have Rent the Runway. They’re all public companies, which is really interesting.

Yeah, Revolve also just went recently. In between the angel round and going public, there’s a lot, I guess, in that six-year span, seven-year span. But some of the real highlights were, one, there’s just amazing product-market fit. Where the first few years, we spent no money on marketing and couldn’t keep up with the business, it was growing so fast.

We were all of a sudden doing hundreds of million dollars, all of a sudden getting close to a billion dollars. A lot of that was really just because this really strong ... There were just women everywhere — and now men — who really just felt like this is a solution that helps me in my life and helps me to look my best-

Right. That is quicker.

It’s quicker, but it’s also more effective. It helps you to find things that you never would have found, and it does it in a really human way. I think there was just a real connection of the business with the end consumer.

The venture side is harder. There were times when the business was doing phenomenally well. We were close to profitability. We’ve now been profitable for maybe four years, three, four years. The business was healthy, it was doing well, and there are a lot of venture investors that were very skeptical about the model.

Right, that’s because so many of these retail businesses have gotten to — I’m thinking of Nasty Gal, some others — who’ve gotten to a couple hundred million or more and don’t reach the next step.

Yeah, I don’t even know what the hesitation was.

That’s the mentality.

There were a lot of times, it was super frustrating, because we would get to the very last rounds where you’re meeting with a whole partnership, and you’re just almost there, and then we just couldn’t get over the line. One venture investor who I really respect who’s a top tier venture fund investor, he said to me, he was like, “Look, I get to invest in one or two companies a year and I’m joining their boards. I want to love what I do. I want to get up every morning and think about your business.” He was like, “I just can’t imagine getting up in the morning and thinking about women’s dresses.”

We’ll get into sexism later.

But I don’t even blame him, though. I understand. I joined the board of Glossier because I love what Emily’s doing and I love her business. I deliberately didn’t join like a gaming company or a hunting and fishing company or something else, because I love it. It’s not like I can blame him for what his interests are. But then you step back and you’re like, you’re looking at the world of venture investors, and they all look the same and all kind of have the same interests. That’s where the problem really is.

Right. Absolutely. Going public, talk a little bit about that journey, because you are one of the few companies that have gone public. Just recently, there’s been a couple more, Zoom and some others. That’s the one that’s done well. Uber and Lyft, not as well. But you’re one of the few that had gone public quite early, compared to the others who are staying private, enormous amounts of time. Talk a little bit about that, then we’re going to talk to the next part about the business itself, where it’s going.

Yeah. The decision to go public was one ... I don’t really know, the staying-private forever thing, it’s not realistic. I think we now see that. I think Uber and Lyft ... and there’s a lot of companies out there who were trying to stay private as long as they possibly could, and they’re now coming out and having to do the same things that we did two years ago.

Obviously, I think it’s a myth that you can really stay private forever. Actually, SurveyMonkey was the one company that really had stayed private forever. Now they’re public, too. I think it was a reality that that was going to be the outcome for a business of our scale, being profitable with a lot of growth prospects ahead of it.

Then it was really a question of timing, of when was the right time to do it. I think we went at the right time, where we really had really healthy growth rates. We now are in our, I think, seventh quarter in a row of over 20 percent year-over-year growth. So, our growth is predictable, it’s more controllable, it’s more stable. But at the same time, we still have a lot of growth ahead of us, where we have the $400 billion-plus market out there. We’re coming up on a year here where we will be doing, $1.5 billion is our guidance. We have a large base but still a lot of growth ahead. I think it felt like the right time to go.

What’s it like being a public company CEO now?

It’s different. It’s challenging, though. I like some of the challenge where it’s been really interesting to better understand how the outside world perceives our business. I feel like I’ve been on a really quick learning journey around communications and just how we can be thinking about communicating our story in a more global way, in a more broad way. We were so private before. We’d raised very little money.

What was the total you raised?

Under 50 million.

Which is just a little bit, yeah. Which is a small amount.

Yeah. We actually didn’t use all of that. When we were profitable and cash-flow positive, we still had 27 million in the bank.

That’s very Pierre Omidyar of you. That’s what eBay did. They had tons of money in the bank still when they ... So, go ahead. So, being a public company.

So, being public. I spend my time in more different ways, and a lot of it has been really new to me, but I actually really strongly believe it makes us stronger, where I think now we really look at every dollar that we are using in the business and really understanding how it’s driving long-term value. I think it really helps us think about our narratives of like, what is the larger story of Stitch Fix and how does this year fit in? It pulls the lens back farther, where people talk about the public market being short term. I understand some of that, but for us, I actually think it’s ...

Puts the discipline. I think it puts discipline on companies.

Totally. It’s made us more long term in some ways, because I think this isn’t about making a quarter, we care about what are people going to be thinking about Stitch Fix four years from now and how is that going to be reflected in our business? I actually think in a lot of ways, it’s made us more long-term thinking.

I think staying private so long is, it’s a condition of Silicon Valley’s juvenile ... Staying private for a long time gives you no discipline, no adultness, no...

You have to be held accountable someday. In some ways, I think it’s easier to do that earlier, because then you build the muscle. It’s hard to scale back free lunches and free dry cleaning or whatever.

Not just that. It’s behavior of CEOs — I think Uber, if they had gone public earlier, they certainly would have had a different story.

That would have been interesting.

Think about it. Scrutiny, I think, is always a good thing.

Yeah.

For some reason, Silicon Valley is scared of it. Do you consider yourself a tech company, or how do you look at Stitch Fix right now?

The thing that is special about Stitch Fix is absolutely in our technology, in our personalization capabilities. That is undoubtedly what makes the company special and what is going to help make us successful for years and years and years. But this notion of a “tech company” is one that I think is going to be gone 10 years from now. If you want to be ...

It’s like a mobile company.

Exactly. If you want to be relevant 10 years from now, every company is going to be a tech company. Airbnb is a hospitality company and Uber’s a transportation company and we are a retail company. But if you want to still exist in a decade, I think everybody’s going to have to be a tech company and figure out what is the thing that is going to be lasting about their company.

But you’re a retail company. Really, you’re selling things, right?

We’re selling apparel, retail, absolutely.

Right. You’re branching out into other things.

Yeah. Now, we have our core women’s business that we now are totally size-inclusive.

Which is how much? That’s most of the business, right?

Most of the business is still women’s. But we have petites, maternity, plus-size. Then two years ago, we launched — longer than that, two-and-a-half years ago, almost three years ago, crazy — we launched our men’s business. The newest are our kids business and the UK business.

Yeah, I noticed that kids business, interesting. It’s an interesting ... The idea behind that is to get just more market share.

Yeah, it’s market share. These are places where I think we deserve to win and where our capabilities extend really easily. Rather than let somebody else take market share, we wanted to be there first, and we wanted to be there to take advantage of it. There’s also a household play element where ... one interesting anecdote with our kids business is that, if you compare it to other kids businesses, what I would call the tween audience, kind of 9-13 or so, that segment is bigger than what you would normally see in a kids’ business. What we have come to learn is that it’s actually because, when a mom is getting fixes then the daughter really wants to get one too.

I think that mommy-and-me, not just being in young kids but being in this age where kids have more say, has been a bigger business for us. This idea of being able to serve a whole household, I think, is also one that’s really powerful.

Including men.

And men, yes.

How’s the men’s business been?

It’s been great. Now we’re at about three years. That business in many ways is just as strong if not stronger than our women’s business. Now, it’s at a point where we can think of it as a business that we can drive and put marketing behind it and have it grow and contribute meaningful ways to the business.

I think the men’s business really gives us this confidence that we are now in the business of creating great businesses and that now we think about the kids and the UK and how we can grow those to be like the men’s business, as being another source of ammunition for us and runway as we think about our growth plans.

Let’s think about growth, because most of it is still in the main women’s business. Now I use Stitch Fix, first because Jason Del Rey made me. For some reason, he wanted to get some information, and then I just kept it. It’s fascinating because I’m literally not your demo at all, and you missed me ...

What makes you say that?

Well, I’m not. Here’s what happened. Did you hear what happened? I think your people told you what happened. I tell this story. I got it for a while and it never was right. It was never right, except for some pants. Pants were always good. I’m wearing a pair of Stitch Fix ...

That’s great! Pants are hard to fit.

I love all your pants, your pants are great.

I love it.

When I don’t take them, I want them, I just don’t need more pants. I have only so many legs. I got them for a long time and I sent back. I always answered your questions, your weird swirling thing where you’re saying no, no. I’m always like, “no, no, no, no.”

It’s super helpful.

It really is. Anyway, I finally got a box, I bought everything in it this one time, like everything. I liked everything, it fit great. I loved it. I sent back, “I don’t want to send anything back this month.” I usually send the whole package. It’s super easy. For people who don’t know how to use it, you get the box, you like or don’t like things. You stick them in the bag that you put in the box and then you check out. That’s it. It’s so easy, it’s simple, simple, simple.

Just pay for what you get.

I hate shopping, so it’s perfect for me. It’s two seconds. I’m your perfect in that regard. But you were giving me all these flowery shirts and I just didn’t want that kind of thing. I took everything at one time and the stylist wrote me back, I forget her name. She goes, “I finally figured you out, you’re androgynous and simple.” Which I was like, “Just a second, stylist lady!”

Is that inaccurate?

It was totally accurate! At the same time mildly insulting. But I was like, “That is correct.” I was like, “I am so angry that you are correct.” Since then, you’ve been sending me simple and androgynous clothes and it’s worked. I think I should just go to your men’s area or something like that. But it was really interesting. It’s weird, but I actually enjoy it. I don’t enjoy many shopping products, and it’s an interesting ... I find ... “What crazy shit are they going to send me?”

That’s what ... I think so much of the inspiration for me was, there were so many elements of shopping that I used to love that I felt like e-commerce had taken a lot of the joy away from it, and stores today, it’s impossible. When am I going to have time to do that? I love to hear that you say that you enjoy it, and it makes you love shopping.

Yeah. Well, I don’t love shopping.

Well, you love shopping through Stitch Fix.

It’s fine. Yes, I do. It’s interesting because just recently another friend of mine has been using the renting clothing from ... You guys don’t do that.

We don’t.

Rent the Runway does. But now they’re renting outfits for ... They do it. I thought it was just for gowns and things like that, but they do it for their whole life.

They do. Yeah.

Which was really interesting. It makes me think, especially among young people, this idea of ownership of clothing is maybe a few pieces, and then you rent every ... You didn’t think of clothes that way.

Yeah. I think all of this innovation around different ways that you can think about apparel is, it’s all goodness for us. I love to see how the rental market is taking off and that it isn’t just about occasions and that we see so many more women who are thinking about consuming clothes in that way.

To be honest, all this lifts all tides for us. It’s like, right now 80 percent of this industry is still clothes that are bought in stores. That’s amazing that 80 percent of the dollars are still tied up there. So, all of these new ways of shopping are really helping people to open up their minds to new ways of doing things and trying things. I see it all as being really additive.

It’s interesting, the innovativeness of that, the idea of renting your regular clothes, or using brands that you pick. Now, you have relationships with certain brands, right?

Mm-hmm.

They are exclusive to you, or you’re just a distribution vehicle for them?

We have both. We have brands that many people know and love. We’ll have Paige denim and Rag & Bone and we have a lot of contemporary brands that people know. Then we also have some brands where they are actually creating exclusive product for us, sometimes under their own brand name, and in some cases they are actually creating a brand specifically for us. Then we have another portion that is what we really call exclusive brands, which is brands that we’ve created where we actually create the product.

In a lot of those cases, we’re really intentionally doing it. In our men’s business, for example, when we were first launching, we realized that there is this need for a men’s woven shirt, like a button-down shirt that you wear every day, at $48. We looked everywhere in the market and there was no vendor that was making that product at the right price point with the right quality. But we really needed that as a go-to-market. So, we created relationships with factories, and we have our own design team, and we created what we consider the perfect shirt. Now, that’s a really big business for us.

In our men’s world, those exclusive brands have been especially successful because we have been able to so intentionally create product against what needs that we know there are there. But all of those coexist under the Stitch Fix umbrella and help us to be able to have this really diverse, wide breadth of products so that we can serve your style and we can also serve somebody else’s style who does want the floral shirts that you didn’t want. All of those brands are a really important part of the equation.

I want to talk a little bit about, when you’re thinking about the idea of what’s changing in your business, what have you changed since founding? Because it feels the same, a lot of it does feel the same, but how do you continue to innovate in that way? Do you watch other people?

Yeah. I think what’s really both interesting and also the opportunity with Stitch Fix is that behind the scenes, what’s really cool is 100 percent of what we sell — this year, we’re doing a billion and a half in sales — 100 percent of the billion and a half is by recommendation. That’s such a powerful concept. I don’t know if there’s anybody else ...

Meaning, what people reject.

One hundred percent of what we sell is because we recommended it.

Oh, I see, by your recommendation.

We’re selling clothes all by our recommendation.

But you’re also getting the feedback cycle of what people reject, too.

Exactly, for sure. Yeah, exactly. But that all of the sales are because we recommended it, you’re not coming to a website and clicking saying, “I want this exact thing,” and we’re shipping it. That’s not how we operate. In apparel, that’s like a really radical concept, that all of the sales would be not selected by you. What that has done is created this incredibly strong personalization muscle that we have. We have this amazing capability where, whenever we’re sending you things, we have a high degree of confidence in terms of what you’re going to keep, what you’re not going to keep. We have scores that predict that really accurately. That’s helped us to drive this business today of sending often five things in a box to men and women and kids.

But I think the future is really around ... My point is more of just in the last eight years, there’s nothing that you as the end consumer really sees, except that actually our keep rates have gotten better and that people are more satisfied. Those are things that we’ve been able to see over that time period, but we’re not necessarily showing you behind the scenes or how the sausage is made. But the reality is, the personalization capabilities are so good now that what we’re really thinking about is how do we bring those to life in more ways, and how do we make it so that you can engage with Stitch Fix in ways that isn’t just in that box and five things? How can we take these amazing capabilities that we have and help it to expand our wallet share with you and our addressable market? I think you’ll see more to come on that front.

But even in the last six months, you’ll see Style Shuffle, what you talked about, where you thumb up and down things. That’s been a new product innovation. We talked a little bit about buying new colors, which is actually relatively new, where you can then go back and see all the products that you’ve bought in the past that was recommended from us and buy things. If you want the pants that you love in other colors, those are things that you can do. Those hopefully are glimmers of the types of products and niches that are to come.

Sure, absolutely.

We’re here with Katrina Lake, she’s the founder and CEO of Stitch Fix, which is a clothing ... What do you call it, a clothing recommendation company?

Yeah, great. We’ll go with that.

Clothing recommendation. What you do is get a box of five things, and a lot of companies have tried this, there’s dog companies that do this, there’s all kinds of things, that you try things and return them essentially, and then whatever you keep you buy, and then you send things back rather easily. It’s a pretty nifty system, especially with people that don’t like going to stores, like myself. It’s an interesting way to try to figure out what everyone likes. Do you have like a customer, do you have like a hipster girl, or what’s the ...?

You know, we actually have stayed away from personas because ...

Yeah, it doesn’t seem to have a personality.

And it’s really like, we should be able to serve everybody, like our inventory is broad and wide, and I think that’s what’s really powerful about being in the business of personalization, is that we can have a different storefront for every person. For you, we can have ...

Androgynous and simple. Thank you.

And for somebody else, we might have more of a “bohemian romantic,” and that helps us to be able to serve people who are 15 years old, 65 years old, and serve them equally well in their aesthetic, in their style and their price point, and I think that’s part of what creates the really large opportunity ahead for us.

When you talk about the opportunity, you’re moving into other categories like men’s and children’s and abroad. The UK is your first.

UK is our first, that’s right.

First international expansion. What about things, you also have other things, right, other products, accessories and things like that, shoes and belts and earrings, I think.

Yes, we do, we do. Yes.

That’s just trying that out, or just ...?

No, that’s been part of our business for a while. We have shoes, accessories, jewelry.

I seldom get shoes.

Would you like more shoes? I can add that.

Not necessarily, no. I just bought these cool shoes, some stylist gave them to me, from Vox.

Oh, I like those.

And I just put them on, and that’s it. That’s how I roll. What else could you have? This idea of a rundle, let me explain. It’s a company you trust, I’m just going to use an Amazon or Apple or Nike, and you trust them with your sports stuff, so why wouldn’t you trust them with your blank, like your gym membership? Why would you trust them with other things? More of a relationship, because you trust that company to make selections for you. It’s sort of a subscription bundle, so he [Scott Galloway] calls it a rundle. I don’t know why.

Oh, interesting.

Sounds very Amish. But the idea is that you have a larger relationship with a company, that you trust them for a lot of things. Is that what you’re thinking of when you say you see glimmers of things, when you ...

Yeah, it’s more just I think this idea of personalization today has happened in the form factor, as you said, of five things that you’re getting in a box. When you’re engaging with Style Shuffle, for example, you’re thumbing up, you can log in to your app, you can log in to your Stitch Fix app and you’ll get a little quiz that says, “What do you think of this?” Then you can take a denim quiz, or you can take a night out quiz, or you can a jackets quiz, or whatever it is, and you can thumb up and down things and let us know what you’re liking. That’s just a glimmer of a way that you can engage with us. That’s not just kind of in the box.

So when did that happen? I make selections.

And today, that actually massively improves our ability to get to know you, but actually, also our ability to get to know all of our clients. It turns out that data, you talked about the surveys that you fill out, the surveys that you fill out at the end of the fixes, those are super helpful in our helping to understand fit. When you say this fit perfectly or this didn’t fit perfectly and why. Style has been a little bit harder to unlock, and the Style Shuffle has been a really, really helpful thing for us.

Why is that? Because you can’t say why you don’t like something, it’s harder for people.

It’s harder, and Style Shuffle gives us a read on a much broader swath of inventory. You might get a floral shirt in your fix and say, “Look, I’m just not going to wear florals,” and great, but then there’s all kinds of more data that we can get from you in Style Shuffle, which happens more, you can do it every single day if you’d like.

That’s an example of a new way to engage, but I think the idea is that with personalization, we can actually take this capability, and it doesn’t have to be five things, it doesn’t have be in the box, and to your point, it doesn’t even have to be apparel. I think that’s the really special part about this company, that we’ll be thinking about how do we use that capability to grow over the next 10-20 years.

Right, because growth is ... I mean, you’re going to run out of people who want to be Stitch Fix customers presumably, or not.

Yeah, I mean we’re not even close to that yet. We’re at a point now where we have 3 million active clients and our addressable market is 400 billion and we’re doing a billion and a half. We’re not even close to that, but I think this capability around personalization is so strong, and in apparel in particular, no one else is able to do this in the way that we are.

Well, it’s interesting, I covered a company, I’m blanking on the name of it. It was in Washington, DC, and it was a hot, hot company. I come from retail, I don’t know if you know that?

Mm-hmm. Yeah.

So I know a lot more about retail than you think, and one of these companies, and I’m blanking, it was a very trendy teen retailer and it was in Washington, DC, and it took off like a roman candle on the stock market. It was crazy, crazy, and they had all these shops and then they had hamburger joints inside the shop, and they always had the right thing that the teens wanted for a while.

Wow. What was this? Hamburger joints?

I’m blanking. It was in Washington, I’ll remember later, but it was back in the ’90s, early ’90s in Washington, DC, maybe ’80s, even. What was really interesting is they missed one season, or two seasons, it was a season and a half that they missed, I don’t know, they got culottes when everybody wanted pedal pushers, and that was the frigging end, and every teen abandoned them in seconds. It was fascinating. They were hot, hot, hot and then they were not, and then they closed, it was fascinating.

When I was covering retail, you saw that. The Gap is a very good example. Remember? They went way too far into fleece, and then they went way too far into weird fashion. It’s the real curse of a retailer not to get it right, but you all don’t have to not get it right because you can shift it immediately, correct?

Yeah, and that’s ...

You’re not making a big bet on culottes! Or something, or whatever.

No, and there’s two reasons for that. I think one is because we are a retailer and we’re not vertical, and so we’re not necessarily hitching our horse to one specific aesthetic. There’s not an aesthetic point of view that we have. Then the second part is because we have this amazing data, we are able to see these trends come and go. And so for example with the rise, and now we’re kind of getting over the fall of skinny jeans, where we could see that skinny, I am full on to wider-leg, highest-rise I can find. They’re cool though, you know? But we can see those trends materialize in the business.

And then, I mean the other thing is also our business, we’re selling over $400 ... our revenue-per-client is over $400 per year, and so at our price points, that’s actually a fair amount of things. What we’re selling are, yes, we definitely have a small, we have a percentage of our assortment that is more of the trend-forward kind of what is hot at this very moment, but a lot of our things are going to be ... A lot of what we sell is jeans that you’re going to be able to wear for multiple seasons, blazers that could last you years, and a lot of those staple pieces. The reality is, the trend part of your wardrobe is actually kind of a small part, and so we’re not as married to the exact thing that is ...

Regular retailers weren’t exciting enough, and then these trend retailers are. I think the growth of something like, how do you look at an H&M, or the MUJI, or things like that? I just bought a pair of MUJI pants, great. I happened to be in France, it was hot as hell and I did not have appropriate pants for 110 degree French weather, and so I went to MUJI and got a pair. I like MUJI, it’s very simple in that way.

Yeah.

How do you look at those retailers, that idea of, not trendy but on-trend?

There are so many choices in apparel retail, and I think in a lot of ways that ends up serving as our advantage, because it’s awesome that you love those pants from MUJI, but it’s like if you were really going to set out on an expedition and say, what are the best linen pants that I can find on the planet? You could literally spend hours and hours doing that research, and who in their right mind is going to devote hours and hours of their life to trying to figure out, of the millions of products that are available to me from the literally hundreds of retailers out there, where are the things that are going to be best for me? I think it’s an enormously difficult proposition for any person, and so I think a service like Stitch Fix, which can use the combination of data and a stylist to help navigate that huge world, is a really attractive proposition.

When you say “out of the box” — you just said that, you just kind of dropped that — but what does that mean? When you said not a box experience, not sending you a box. What else would you do?

Oh, well, so I just mean that it doesn’t ... Like the idea of having a personalized experience doesn’t just need to be in those five things, and I think the opportunity is how can we show more of how we’re personalizing your experience. You talked about the buy new colors, for example, there’s lots of other ways that you can engage with Stitch Fix.

We’re not committing to exactly what that looks like, but I think over time what I would love is ... I think today people wrongly categorize us as subscription and people think of us as like, they think of Stitch Fix and they think of the box. But as I think about five years from now, what I hope is that everybody thinks of Stitch Fix and like, “Okay, they understand me, they know me,” and that personalization part of our business is going to be the dominant part of what people are thinking about.

Kind of multiple brands. I think, seeing different brands...

Absolutely, totally, and just being able to feel like this is a place to discover and finds brands that I’m going to love.

How are brands liking using you? Do you have a lot of Rag & Bone, I saw Vince.

Vince, yeah.

Vince was in there. Some of the stuff I buy normally.

Yeah, great.

Not Theory.

We do have Theory.

You do have Theory?

We do.

I’ve never gotten Theory. That’s interesting, I hope I do.

I’ll add to your note.

Thank you. How do you get them to think about a boxed selection? They’ve all got their stores, they’ve got all kinds of ways to go through department stores. What is your argument to them?

Oh, brands love working with us. We’re a really pure matching channel, we are a way where we can figure who’s going to really love this brand and match them in a way that doesn’t have to do with being super cheap or the cheapest price, and really preserves their brand and introduces their brand into somebody’s home. That’s an incredible value proposition for our brand.

Then in addition to that, we help them to really understand what’s working and what’s not working, and why. With most other retailers, you’re selling them 10,000 shirts, you have no idea why they worked or they didn’t. In our model, we actually share back with our brand so that they understand, “Hey, this didn’t work, and it’s because the sleeves are too tight, or the color was too bold. This worked well, let’s do it in four other colors, because people said they wanted it in other colors.” There’s so much more than we can share with brands to help them to be more successful, not only in our channel but also in others.

In their own channels, too.

Exactly. We have examples of a T-shirt vendor who has, for years and years, sold into traditional retail, and until they were working with us, they didn’t realize that their — it was a men’s brand — their extra-extra large was actually fitting like an extra-large. For years they didn’t know that, because if you sold into a store, it sells or it doesn’t sell, they’re gone. They don’t know, and they don’t know that it’s actually an extra-large person and not an extra-extra large person buying the shirt. With our data, we could actually show them like, “Hey, this shirt is doing great, but the size is off. If you want to have better sales, you need to change the sizing.” They were able to iterate that in our channel, but also in all of their channels, and help their business overall.

When you’re sharing this data, we’re going to talk in the next part about Amazon and some of the other retailers, but let’s talk about other retailers first. What do you look out and see ... like Rent the Runway, how do you look at that? It’s not a competing business to you, I don’t think, but ...

Yeah, I don’t think it’s competing. I mean, I love it, I love what they’re doing, I love that they’re encouraging consumers to try to consume apparel in different ways, and I love that it’s just another innovator in the apparel space, which is 80 percent of this $400 billion world is still being sold in brick and mortar stores. Anything that is innovating and unlocking some of those dollars is a good thing.

That’s them, and then is it Revolve?

Mm-hmm. Revolve.

That’s another one where they have stores where they only have one item in each place and they bring you things, but they have a different kind of experience.

Yeah. I’m not as close to the stores with the one thing.

Yeah, I think Revolve does that. The other one is obviously the RealReal.

Love the RealReal, very different.

That’s a recycle business.

Yeah, exactly.

A recycling business, which is kind of interesting. It seems like, it sounds crazy, but if you look across the entrepreneurial landscape, there’s been no innovation in social media forever, forever, since 2011 with Snapchat, and they remain, as I’ve always said, the product arm of Facebook, because Facebook just steals their ideas and just iterates them. You have no innovation in search, there’s Google just hanging above it. Retail has been an area with a whole lot of innovation, and yet there’s Amazon.

It’s a crazy thing, because in the US, 80 percent of apparel is still bought in stores.

Right.

Amazon has single-digit market share. That’s today.

Today, right.

Exactly, and that’s the opportunity, and I think that’s why you’re seeing so much innovation in this space, because I think the age-old equation of how do you bring something online, which is like, I’m going to sell it cheaper, I’m going to ship it to you faster. That was the equation.

Convenience.

Convenience. And that was the equation of, how are you going to migrate dollars offline to online? In apparel, it’s just not what people are looking for. No one is going online thinking like, “Oh, I have a date tomorrow, I want to look really great. Let me find the cheapest black dress that’s going to ship to me fastest.” That is not how people buy apparel. I think that’s really why you’re seeing all of this innovation around what people are actually looking for in the value proposition of apparel, and that these are all going to be the vehicles that help to unlock more and more of that market share that’s still stuck in stores.

Are you worried about Amazon? They are getting into clothing. It’s a lot of socks and underwear right now, I guess, and some other things, but how do you look at their moves into apparel?

Yeah, I mean, it’s impossible not to think about Amazon. They’re an incredible company and they’ve innovated in so many different spaces, and they’re willing to try anything, and I give them so much credit for that. We absolutely keep an eye on them, but I think what gives us confidence is that personalization is all we do. One hundred percent of our success depends on our ability to get you the blazer that you want and the jeans that you want. We’re really, really focused on this one capability as being the way that we’re going to be able to win in apparel in the future.

And I think that focus is ... I think it’s, so far, well invested, where we feel really confident in that, and I look into the future of retail apparel and I do still think that personalization is going to be the way that you’re going to be able to grow and continue to unlock and be successful in the future.

So you’re not worried about all their formulas and different things and relationships with customers?

I watch it.

They’ve certainly marched into things.

Absolutely, yeah.

They’re marching more towards furniture right now, but they march towards apparel.

They’ve tried a lot, and we definitely keep an eye on them, but I think the thing that keeps me up at night is more of just like, how do we innovate faster, how do we get even better and better at this? I feel like I’m more thinking about ourselves and our capability first.

When you think about where that goes in terms of measuring people, in terms of having a different relationship, there’s all kinds there, I’ve been so many different iterations of retail things. They’re going to come measure you perfectly, that everything has been made just for you. How do you look at that market?

I think that truly, like, most people ...

It’s not even personalization, it’s clothes just for you.

Right.

Designed just for you.

Yeah, and I think in some categories that’s useful, and for some people that’s really useful, but by and large people are going to be able to wear off-the-rack clothes, and the question is, though, which ones are going to be best for you? Because different brands are going to be cut differently. In some cases, a petite offering is going to be better for you, and so I think being able to have a broad assortment with lots of different vendors ...

We have a measure behind the scenes that we call latent size. You might think that you’re a size four, but we actually know if you’re a bigger size four or a smaller size four, and so we’re able to match you with the product that’s going to be better, even within just that one narrow band of what’s going to fit you best. I think that that capability is going to be much more useful, of trying to make sure that you can navigate that huge world to figure out what product is right for you, and it’s kind of a rare occasion when you’re really going to need something made to order.

Last question in this part, because I want to talk about the future of retail, but you look around the streets, I just got back, the Castro is closing stores everywhere, parts of Brooklyn, I just noticed everywhere I go, retail, every small town, every big town, offline retail has gotten a hit that it doesn’t look like it will ever recover from. Can you talk about this? Do you feel responsibility toward that, or how do you look at it? I blame Amazon more than you, but you know what I mean. How do you look ... Do you think we are just abandoning the idea of that?

No, I don’t think ...

You don’t have a store, right?

We don’t have a store.

Glossier does, which is fascinating. The Glossier store was literally, you couldn’t get in.

Wait for an hour and a half.

It was moms and daughters a lot and it was an experiential kind of thing, but you don’t have that.

No, we don’t.

Why?

Today, we just see so much growth online and just doing what we do, direct-to-consumer today, and so it’s just not part of our growth plans right now, which isn’t to say that it won’t be in the future. But I don’t know, I hope that it’s not the end of stores, honestly. I think it’s just more of thinking through how does a store fit into your business? I think the old version of what a store was is like it’s a place for a transaction, you come in, you find something, you pay for it. The reality is, e-commerce is almost always going to be quicker and faster.

In that regard.

In that regard, and so if your store is a transactional convenience-based play, I think it makes it really hard to compete against an Amazon. But a Glossier, that’s a great example. If people are waiting an hour to go into that store.

It was in Los Angeles, the one I was in.

Yes, and they do pop-ups, and those are amazing experiences, or places where you can experience the brand, where you can try things on.

Take pictures.

Take pictures for sure, and connect with the brand. I think that’s a good example of what a new version of a store can be, and I don’t know what that’s going to look like for Stitch Fix, but I think there is a place in the world for stores, I think it’s just going to be very different than what we saw in the past. And so I think we’re just in the middle of this inflection point of a store that’s set up for “I’m just going to take your money and sell you products” is having a hard time.

Which works fine if it’s iced tea and cigarettes or something like that, but not so much ...

Maybe not even cigarettes these days.

Right, yeah, yeah, yeah. One of the things that’s interesting, even with boys — you always think of shopping with girls, but you shouldn’t, or women — but my sons never go to retail stores. They go to the Nike store, they love the Nike store for some reason.

The Nike store is another great example. It’s like a brand experience, you know?

I know, it just gives me a headache. And I always end up spending like $400, no matter what I do.

An effective brand experience.

Right, right. I always end up poor when I leave that store. Even a Warby Parker, that’s another brand experience, that’s an offline-to-online brand experience. Tyler the Creator had a store in Los Angeles, and you waited in line to get in and then they had only one of every item, and then somehow I paid $102 for a sweatshirt. I literally was like, “How did this happen to me?” I couldn’t take pictures inside, the whole thing was fascinating as an offline retail experience. I thought this is the future of offline, it was experiential, it was different, it wasn’t one-of-a-kind precisely, but it was a special experience, which was kind of interesting.

Right.

So you don’t see stores in your future?

Well, just not in our immediate future. Honestly, we just have too many other growth initiatives right now, but I think it’s interesting. I don’t think that stores are dead, I think they just are going to occupy a very different place in the consumer journey, and I don’t know, I’m excited to see what that looks like.

What is the most exciting, futuristic thing that you’ve seen if you look at where ... Where do you think retail is going to go? Is it all going to be online and then some offline? Because almost every product can be put online, it feels like.

Yeah, I think this idea of, “How do you merge all of the sensory inputs that you have?” You think about, like, you’re going through Instagram and you like some things, you see something that somebody’s wearing when you’re walking by and you like that, and how do you actually merge all of those into the collective, “This is my style and this is who I am,” and then be able to execute on that? I think today, all of that is really disparate. You’re liking things on Instagram and you’ll be pinning things on Pinterest, and then that’s totally disconnected from your online browsing experience, where you’re still going in to Google or whatever search platform.

Amazon, yeah.

And searching for things. And so, I think the future is going to be just a more cohesive way for you to be able to, kind of, ingest and understand what your style is, and then a more effective way to be able to show up, the person that you want to show up. And I don’t know that I’ve seen that yet. I feel like I’ve seen bits and pieces of it, but ...

Such as where?

Such as?

Where have you seen that, where?

I don’t know, I mean all of these things that I just mentioned.

Right.

You look at the way that people are cobbling this together now, and you can cobble together kind of like, “What are the things I like?” And then you can use your Stitch Fix Closet or you can ... There’s other, actually, there’s other closet apps, but it’s all kind of a disparate experience today.

How do you market your company? Through Instagram or for other ...

Yeah, we use a wide variety of ways, and we’re committed to diversifying our marketing channels so that not one channel is more than 50 percent. But yeah, of course, Facebook and Instagram, and we do podcasts, actually, we do a lot of advertising on podcasts. A lot of people listen to podcasts.

They do.

Good thing.

Yeah.

And we also use radio, we also use TV. And then, what we’re sophisticated with now is to be able to attribute where people are being exposed to Stitch Fix and how we’re getting them through the funnel. But Stitch Fix is a really different type of apparel advertising.

Because you’re not a subscription. People do think also ...

People do, yes.

But you’re not.

We’re not, importantly.

You don’t have to pay anything. You have to pay for it when you get it.

You pay for it when you get it, absolutely. And, while you can get Fixes, you know, get it quarterly or get it every other month, first of all, you don’t have to, you can do it a la carte anytime. And there’s no notion of like, “I’m committed to paying a certain amount every month.”

Right, yeah.

You’re really just, you’re paying for what you keep.

That would annoy me.

Well good, we won’t do that to you.

That would annoy me. No, I don’t like a subscription. I just found out I was on a subscription for a service I didn’t know, and I’ve been paying for years and I didn’t ...

I love that our incentives are aligned. We don’t profit unless you are finding things that you love, and so this idea of paying, charging somebody in the background for something that they’re not getting value out of, that’s absolutely not what we do. And that’s part of the reason I bristle a little bit when people use the word “subscription” with our business.

So how do you educate them?

It takes time. And it’s also showing them a little bit more around the ... Everything that we sell is one-to-one personalized. We have a stylist who is, you know, it’s remarkably human that somebody would say in their note like, “I get your style now and it’s androgynous and simple.” That is a remarkably human thing for somebody to say.

I thought that was a bot, but that was fine too. I didn’t know.

I mean, if you can train a bot to do that, we’ll buy your bot.

Yeah, Nikki I think, I forget who it was, I don’t remember the name, but I felt it was a bot. And I was fine with that, I was okay with a bot styling me.

Well, I don’t know that we have a bot good enough to do that quite yet.

There’s going to be a bot, there’s going to be a bot that knows what Kara Swisher wants to wear.

No, and unquestionably, our data is helping us learn that more and more.

Yeah.

But those human connections, and even that license to say that to you, that’s something that I think only a human judgment can do. And so, that’s remarkably different about our model, and that’s also what is really special about our model. And those are more of the adjectives and associations that I would love for us to be known for.

All right, I want to finish up talking about a couple more things around being a woman leader. But before I get to that, before I get to that, I know you have to endure those questions all the time and men don’t have to, but you are one of the few, you’re one of the few women leaders. But when you think about things that you’re scared of as a CEO, let’s get into it that way, what is something you’ve done that you’ve been like, “Oh, that was a mistake,” or, “I shouldn’t have done it that way”?

There are two big learnings that I feel like I’ve had, and one is just how valuable really good people are. I feel like I used to, you know, you’re going to hire somebody and you call references and you do back channels and whatever.

Right, they’re always wrong.

Well, and now what I listen for is like, it’s not enough for somebody to say, “Oh yeah, I liked working for Kara.” I want somebody to be like, “I loved working for her, and this is why, and these are the things that she did.” And that difference between “I like them” and “I love them” is a huge difference, because that “love” is where you get that irrational loyalty, and someone who just is hearts-and-minds invested. And so that’s, I think, just hiring really amazing people that people love to work for is something that I undervalued.

It is interesting, because people don’t give honest feedback. First of all, they don’t give honest, you’ve got the “like” part, but mostly people don’t give honest feedback at all.

It’s very easy for somebody to say, “Oh yeah, I like them.”

Yeah.

It’s actually a much higher bar for somebody to be like, “I freaking love them,” right?

Yeah, it’s interesting because I get called a lot about references. I often say, “No, they’re awful people,” you know? And people are like, “What?” And I’m like ...

I will leave you off my reference list.

No, but no, but you know what I mean? It’s so funny. Someone called me the other day and I’m like, “Ugh.” They didn’t get to hire someone and I said, “You missed that bullet.” And they were like, “What?” And I’m like, “That person’s a jerk.” And they’re like, “What? We hadn’t heard that.” I’m like, “Well, then no one’s telling you the truth.” And it was interesting, because it’s just interesting when I think about that, myself. So, one is finding people.

So one is finding amazing people. And I think the second one is actually more, it’s broadly about communication is maybe the way I’d put it. Of just how, as the organization is thousands of people, so many of these decisions that we make, we make them really thoughtfully and we look at it, we turn it over a thousand different ways and then a decision is made. And a lot of times, as an employee in the organization, you just hear about the decision.

Right.

And you don’t hear about all of the whatever making and the behind the scenes. And I think what I’ve learned is, actually sharing more of that and helping bring people along, it’s like, it’s good education and it’s helping people understand what the trade-offs are. And so, I think that’s another thing that has been just a really good learning journey for me.

That’s a different way, because top down without an explanation is how most companies run.

Yeah, maybe. Or maybe that’s the way we’re used to it running.

Right.

And it’s weird, because it was, I feel like I’m all about creating a new company, and yet when it came to sharing decisions like that, I don’t know that I thought about it. And then, now that I think about it through the lens of somebody who doesn’t have all that context, and I’m like, “Of course they would want to better understand why we’re making that decision.”

And so, I’m just so much more thoughtful now in terms of how we communicate with employees and how much we want to share. And sharing those decisions in really authentic ways, to be able to say, like, “Here’s what was hard about the decision and here were the trade-offs.” I think that authenticity and communication has been another big learning for me.

What’s the thing you’re most scared of as the leader?

I don’t know, I mean, I think there’s a lot of things that are hard in terms of what ... I think there’s just a lot of expectations, I guess. Of just like, it’s really hard and I’ve gotten such thicker skin over this, but it’s hard when you feel like you can’t make every single person happy. And that’s just always going to be true. And at any given point, I think we’re trying to, I don’t know, optimize for like, “How do we make our clients happy?” And that’s first and foremost, but also doing it in a way that our employees are empowered.

And so, I don’t know that I’d say that there’s anything big and scary that I’m scared of, but I think there’s just, there’s a lot that you have to think about in a role like this. And there’s a lot of trade-offs and they’re not always easy things to trade off.

Do you feel like you have extra duties as being a woman leader, one of the few? I mean, you yourself. We’re not going to go in to the stupid Justin thing, but thank you very much for talking to me about that, by the way. You don’t understand how very few people talk on the record. Katrina was bothered by an idiot investor and was very brave enough to talk about it. Which is unusual, by the way, just so you know.

And to be clear, I am legally obligated to not talk about it.

I know that, that’s fine, I’m not going to, no, but you did. You stood up and talked about it enough, like in the way you did. But when you’re a woman leader, do you feel that you have different expectations with Wall Street on you, or do you feel, or not? Or do you say, “This is the leader I am”? Because there are so few.

I mean, yes, the answer has to be yes. I think I feel greater gravity, I guess. And that’s ...

It shouldn’t be. You should be able to be terrible, you should be able to be good, like you can’t be terrible is the thing, right?

Yeah, and to be honest, I mean, I don’t want to be terrible anyway. And so, it’s not like it’s hard to do that, but I do feel like I just, these things mean more. And the IPO picture is a good example, where it’s, I mean, it’s kind of a longer story, but that I’ve never been good at fundraising. I’ve been terrible at fundraising, and the IPO was kind of no exception, where it was a little rocky, it was hard.

Why is that? Why? You just ...

I don’t know why, you can ask investors.

Yeah.

But it’s just always been hard for me. I think you can be a good CEO with being good at a multitude of things.

Right.

And, there’s some CEOs who are really good CEOs because they can raise tons of money, and you can do a lot if you raise tons of money, and that’s just not me. So anyway, with the IPO, it was kind of rocky and we were pricing below the range, and I was kind of sad. But it was also, at the same time, really motivating. Where we all felt like, “Okay, that’s fine, everyone wants to underestimate us. We’ve lived through this before, we’re going to do this our way.” And that actually contributed to this, the picture that ended up getting passed around Twitter quite a bit of me up there with my son, who was at the time, 1 year old.

Yeah.

And, there’s a shot list at the Nasdaq of what all the pictures were, and I was kind of like, “Screw the shot list, we’re just going to do this our way.”

Right. It is kind of weird and antiquated, isn’t it, the way they do that? Anyway, I just always find it odd.

It was like an orchestrated wedding.

Yeah, and everyone always does it. It’s funny.

You just kind of go along.

Yeah, I know.

It’s a busy day.

Yeah.

But the point is, is that I felt very empowered in that moment of like, “Screw this, we’re going to do this our way.” And that moment, in some ways, was kind of a turning point for me in how I think about myself as a leader and motherhood, and being a woman. Because, I don’t think I fully realized until that moment that it was meaningful to a lot of people that weren’t me, of being up there with my son and what that represented. And that to me was super inspiring, because it made me realize that just through my day to day, I have the ability to make an impact.

Absolutely.

And to make an impact on your sons and my sons and what everybody’s going to think about as leadership in the future. And that wasn’t accessible to me. I looked around and I didn’t see many CEOs or public company CEOs or tech CEOs ...

Their kids.

That looked anything like me.

Right.

And so, I think just being able to realize that just through being me and authentically being me, I can make a difference has really changed how much I embrace being a woman and how much I understand that there’s more gravity in what I do. But I also respect that and, in some ways, cherish it and hope that these micro things that I do can help to change what leadership looks like 20 years from now.

You never … didn’t want to not be CEO of this? Often, founders are moved aside and stuff like that. How difficult is it to grow as the company grows? Not everyone makes it, very few make it, actually, founders. It’s interesting if you watch, Bezos was one of them. Like, there’s just less than you think.

Yeah, no, it’s true. And I think some of that is the founder not wanting to do it, some of it is capability. But, I mean, I don’t know, I’ve kind of loved all the stages, honestly. Each one is really challenging in its own way, and that has kept the job really interesting for me. But the No. 1 thing that I am grateful for is just having an experienced team around me. And so Mike Smith, my COO, who’s now been with me for seven years, he was the COO of walmart.com.

Right.

I mean, he’d seen so much, he’s seen more scale than what we’re currently doing. He’s seen so much scale, he’s an amazing leader, and I got to learn from him. And just being able to be surrounded by people that I was learning from who are giving me feedback, who are making me better, there is no question that that had probably the biggest impact in me being able to scale with the business.

And lastly, you’re on a couple boards, Glossier, as we said before, and Github.

And Grubhub.

Grubhub, sorry. Not Github, Grubhub. Why did you decide that? I’m just curious, those are two unusually different businesses.

I love them both. Grubhub I joined before we went public, and that was, I mean, I’ve learned so much from that company. But they’ve grown a ton, they’ve been a very fast-growth company in a very competitive space.

Sure, or Postmates, all of them. God, that is crazy with Uber Eats and ...

But they’ve been super successful, if you look back, and their stock is volatile like ours is.

Yeah.

But you look at what they’ve delivered in terms of financial performance and it’s really impressive. And so, I’ve learned a ton from that, of a team that’s really seen scale and has grown and continues to grow, out of really large scale. And doing it profitably, which we are also.

Yeah.

And so, there’s so much that I’ve learned from that.

I don’t know, that market’s a death match.

It is. But it’s growing, the whole market is growing.

I know, I know. But I just feel, “Oh, geez.”

Grubhub is doing it profitably.

It’s Hunger Games at some point. There’s too many people entering the picture.

It’s competitive, no question.

Yeah, yeah.

And then Glossier, I mean, I love Emily, she’s a super-inspiring entrepreneur. And I learn a lot from her, too. They’re amazing at brand building, they’re amazing at experience building, and those are things that we have less experience in doing. And so ...

Which is their own products. They make all of their own products.

They do all their own products.

Yeah, and they make them slowly.

And they have an amazing brand.

What is it, like 100 SKUs they have? They just have ...

Yeah, probably something like that.

It’s a small ...

Not that many.

Yeah.

Yeah. And so, both of those, I do them because I love them, I learn a lot from them, and I’m able to bring a lot of those learnings back to Stitch Fix. And they’ve both been fun.

So, two more questions. One, you talked about the stock being up and down, how do you assess your stock success? How does that affect you? Because some people think, “Maybe you’ll get bought, maybe you’ll be...” do you think about that?

No, I don’t think about that as much as I think, how would I articulate this? I think when I first — this was another learning, honestly — like when we first went public, probably kind of flippantly I was like, “Oh, don’t look at the stock price. It only matters where it is a few years from now.”

Mm-hmm.

But the reality is, we’re in Silicon Valley. The stock price is, that is a big part of their compensation.

Sure.

And so it was flippant for me to say that. But what I realized is that we need to respect where it is, but also, we need to be making the decisions that are driving into the longer term. I can’t ignore the fact the people do look at it, and that people do get stressed when it’s high or mostly when it’s low, I guess. And so I think we have to acknowledge it more, but I do think that the lens really should be around, you know, you’re getting a stock option grant that’s going to last for four years, and where is that value going to be over the longer term?

The stock has definitely been volatile. If you zoom out, it’s going in the right direction, and I think we’re really excited about the things we’re doing right now that can help us to continue to drive that way and to accelerate, hopefully, driving that way. And so, I don’t know, my mind has changed a little bit, of just like, making sure that we are acknowledging it and making sure that we recognize that.

Yeah, Wall Street doesn’t get retail as much as they ... they’re not as fair to retail as they are, they’re tougher on the things that they should be tough about, as they are, say, on a social media company. They give more leverage.

You know, it’s funny. That whole retail or tech thing has actually been challenging also, because I think there are, we have people who are looking at our metrics from a tech lens.

Yeah.

We have people who are looking at it from a retail lens, and we’re newer in this business, and so it’s, I think we’re ...

Yeah, retail always seems to get it harder than other businesses. I was talking to an analyst, and he was like being hard on, maybe — I can’t remember which stock, and I was like, “You gave a thing to this one, which is a Ponzi scheme as far as I can tell.” You know what I mean? I’m watching closely, and it was interesting, the judged level of certain businesses.

Interesting.

And it was one of the car companies that closed, and I was like, “Come on, look at the economics.” But anyway, “It was the promise of someday.” I’m like, “Really?” It was interesting.

Totally.

It’s interesting, retail really does ...

It’s our responsibility, really. I mean, it’s our responsibility to bring people along and educate them and understand why Stitch Fix is going to be successful over the longer term.

No, the interesting companies are coming out of retail.

Yeah, I believe so too.

The most interesting and innovative companies are 100 percent coming out of retail, no question.

Last question, I asked this to Megan Rapinoe last night. So, what’s the quality about you that people underestimate? She said she’s disarming, which is true, which is actually true. What do you think is your quality that people underestimate as a CEO, as an entrepreneur?

I think like, I mean, authentic is maybe the word? I have given up on pretending that I am anybody that I am not.

Mm-hmm.

And so, the example I use a lot is using the word “like,” where, I mean, years, I was doing I forget, maybe a talk with you, I don’t remember. But I was doing a talk onstage and somebody tweeted at me or sent me a message on LinkedIn and it was like, “Hey, I loved your talk but you say ‘like’ too much and it makes you sound young and inexperienced.”

I remember that, it was me. Yeah, it was a talk with me.

Was it with you?

Yeah.

Yeah, and I was like, “I mean, I don’t know, like I am young and I am inexperienced. Why should I pretend that I’m old and full of experience?” And so, I think there are things like that, on the surface, that you might judge somebody because they are a certain way. And I think at one point I wanted to evolve those or change those, or show up in a way so that you wouldn’t think that about me.

And then now, I feel more like, “I should embrace those things, because there’s other people who say ‘like’ who would also be an amazing business leader, that maybe somebody is discounting because of it.” And so, I don’t know, I think it’s just the, is the word for that authenticity? I don’t know.

Yeah.

I’m just like, “I am who I am, and I’m not going to pretend to be anybody else.”

Right, right, that’s a good one. That’s a good one to end on. Katrina, thank you for coming on the show. It’s a really ...

Thank you for having me.

I use very few businesses, but I do use this one. I don’t know why, but I just enjoy it.

Irrational loyalty, I love it.

No, it’s not. It’s just enjoyable, I like it. I look forward to it. Like any product that, either I have products that either I find utilitarian, useful, entertain me, or it’s a must-have. I think those are the three things of products these days, as far as I can tell.

That’s great.

And if all of them are combined, that’s really great.

Amazing.

So yours is useful and entertaining. It’s not a must-have, like I can get clothes anywhere, right? But I don’t like shopping, so it’s perfect for me. I really do like your products, it’s great. This is not an ad for Stitch Fix! But I like it.

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