Bag Borrow or Steal bags $15 million

[akula]

My column today focuses on Bag Borrow or Steal, the online handbag and jewelry rental service that often gets compared to NetFlix.

The Seattle company has pulled in $15 million in venture funding, which is a pretty big round of funding.

Chief Executive Michael Smith, the former head of Lands' End, Nordstrom.com and Classmates.com, said the 30-person company, whcih has raised a total of $27 million, spends more than half of its capital buying the high-end luxury items it needs for inventory.

What's next?

Smith says they are looking to use the capital to expand into new product categories, possibly sunglasses, belts, watches, gowns and shoes.

That begs a question. Would people really want to rent shoes that others have worn?

Smith declined to say the product area that they are targeting next, though he expressed confidence that the e-commerce category he dubs as "borrowed luxury" could be a billion dollar business.

http://blog.seattlepi.nwsource.com/v...asp?source=rss

[Young Spark]

Borrowed luxury my ass... you wouldn't catch me wearing shoes that other's have worn... its bad enough I had a tuxedo rental for prom that I didn't know where it had been that I even took it to the dry cleaners to get cleaned TWICE before I wore it... other then that, it was a good night.

I believe it is a possible billion dollar market (the rental industry entirely) but there are many things that they have to face that could effect whether their business is ran successfully. From the point of whether they will get their borrowed merchandise back or if it'll come back so damaged that it can't be used again. In both cases, a "contract clause" of "dmaged or misplaced items become the sole property of the rentee and must be paid for in full. If the merchandise isn't returned by a certain date, your account will be debited."

In either manner, the rental industry has some major flaws... but borrowed shoes is just out of the question in my opinion.

[crackah]

Yeah, this sounds dodgeee!

i woud understand bags, but not clothes, or shoes or what.

Also, how do they ensure the person doesnt run off with a 1k handbag?

[syia]

very interesting business concept but I personally won't rent anything 2nd hand.. I rather buy a cheaper version even when it is fake

[littlesmith]

My column today focuses on Bag Borrow or Steal, the online handbag and jewelry rental service that often gets compared to NetFlix.
The Seattle company has pulled in $15 million in venture funding, which is a pretty big round of funding. Chief Executive Michael Smith, the former head of Lands’ End, Nordstrom.com and Classmates.com, said the 30-person company, whcih has raised a total of $27 million, spends more than half of its capital buying the high-end luxury items it needs for inventory.

[DigitalPalette]

I can see the appeal business wise as its a play on some consignment markets that have opened, but mark my words this will not fly.