Every founder of a company has their own unique story of how their company came to be. Katrina Lake, founder and CEO of Stitch Fix, gives her account of these successes and hardships.
Lake visited The Garage on May 10 for the speaker event, “Advice from Female Founders and CEO’s for the Next Generation of Leaders” and talked about her own experiences as an entrepreneur and building her company from the ground up.
Stitch Fix is an online personal shopper that utilizes an algorithm and stylists to match each shopper with the right clothes for their body type, complexion, and taste preferences. Getting started is easy. Customers sign up, confirm their sizes and preferences, and stylists send five things for customers to try at home.
When reflecting on the company’s creation, Lake had been interested in the changes happening in retail. Her passion for clothing and her desire for ease and accessibility, led to the creation of Stich Fix.
“If a company like Stitch Fix had already existed, I would have happily joined that company,” said Lake.
Lake began business school at Harvard in September of 2009 where her main goal was to find investors for Stitch Fix. She then tested the Stitch Fix concept in November 2010 and received her first term sheet, a preliminary investment agreement, from Steve Anderson in February 2011. After graduating from business school, Katrina relocated the company to San Francisco.
In the early days of the company, it was Katrina and five other employees doing everything. As Stitch Fix expanded, she was able to recruit a qualified and passionate board. During the summer of 2012, Mike Smith joined as Chief Cooperating Officer and Eric Colson joined as Chief Algorithms Officer.
However, the company hit a roadblock when trying to find investors.
“Investors don’t really love investing money in dresses. I never lost faith that the business wouldn’t work but the fundraising was so hard. Ninety-four percent of VC’s [venture capitalists] are men and so there’s a systemic bias towards [women] having businesses. Venture capital is one of the most male dominated fields I’ve ever seen so the reality is that it’s really hard to have a business catered towards women. I’m hopeful this environment is changing. There are starting to be more female entrepreneurs and some more female investors,” Lake said.
2013 was a big year for Stitch Fix with the introduction of new board members and the scaling of a remote stylist system.
“We invested a lot into the technology to access stylists who can work part time, those that were underemployed, and other incredibly talented women. This flexibility allowed us to build an amazing team of mostly women,” Lake said.
To conclude the presentation, Lake outlined the most valuable lessons she learned from Stitch Fix: start with minimal viable product, focus on building a viable business, invest in people who can scale into their role, scale smartly, and build and maintain a culture. Today the company has over 4,000 employees, several locations, and brand new shopping options including men’s apparel.
After Lake’s presentation, other female leaders at the event spoke about the motivations and rewards of being an entrepreneur.
Stella Garber, Northwestern graduate and current VP of marketing at Trello, said, “You’re never 100 percent ready to start a business, you just have to do it. Your career is a continuum. If your venture is a failure, that’s okay because when you start another project or business, people have that much more respect for you.”