Four Google-Approved Tips for Fashion Startup Success - Racked National

During next month's Google-sponsored fashion and tech Startup Weekend in New York City, the Silicon Valley behemoth will host its very first Global Fashion Battle , where participants will have just 54 hours to conceptualize a startup and pitch a prototype to a panel of judges. On Tuesday night, at Google's New York headquarters, a panel of entrepreneurs prepared budding creatives for the competition by offering some choice words of advice.


Uri Minkoff, CEO of Rebecca Minkoff; Liz Bacelar, founder of fashion tech event series Decoded Fashion; and Pavan Bahl, founder of meetup community Open Source Fashion spoke to the sold-out crowd, noting that fashion tech is dominating the startup space. With success stories like BirchBox, Rent the Runway , and Moda Operandi , it's easy to understand why so many people are eager to get involved, but while everyone wants to come up with the next Warby Parker , the industry only has a limited amount of room (and funding) for the same ideas. Here are four key tips the pros gave to those looking to found the fashion startup of the future.



Enough with copycat ideas.


Bacelar, who gets sent some 500 fashion startup pitches each year, said she is sick of hearing about ideas that knock off previously existing companies—we're looking at you, subscription services trying to ride BirchBox's success.


"I keep hearing, 'I want to create this app that snaps a picture and you can share it with friends.' I'm like, 'Get out of here!'" Bacelar said. "I think you need to evolve and do something more than that. There is opportunity to create something new, and a lot of entrepreneurs on a global level think it's a waste of time to pick up products that are copycats of something that came out two years ago."


She conceded that some copycats succeed when they create a product that's better than the original, but that's rare. Instead, investors are looking for fresh ideas and are not interested in the next generation of what already exists. So while visual recognition apps and flash sale sites might have succeeded once upon a time, at this point, the space is way too crowded.


Be niche and nimble.


Bacelar said the best way for a startup to succeed is to make the goal of the end prodcut as narrow as possible. Not to mention, having a specific agenda, as opposed to solving a wider problem, also catches the eyes of VCs and will make the pitch process easier.


"Know exactly what type of brand you are, what you're after, and what you're company is going to be," Bacelar said. "When you are niche, investors like you better, and you know who you should be going after and who you should be talking to."


Minkoff added that most successful fashion startups today thrive by keeping costs low, which they're able to do by taking advantage of technology that helps them spend less.


"Everything we use is cloud-based and service-based," he said of his own company. "It's best-of-breed and latest generation. [Like us], these new fashion startups don't have to spend billions on legacy systems migrating and moving and shifting things around. We have no long-time footprint. Being nimble, agile, and quick is why new fashion brands are able to leapfrog."


Find allies within the industry.


Bacelar noted that a functional startup must have a functioning team of players (remember the mess Silicon Valley's Pied Piper went through while trying to sort out who held what position in the company?). Startups appear more legitimate when they are organized, and might even lose credibility in investors' eyes if there's drama during the process—yes, you might have a certain set of Harvard-educated twins in mind.


Bacelar added that once a company's roster is settled, it's important to find friends in the industry, whether it's people with impressive reputations or deep experience in the fashion or tech worlds. "You need allies to succeed," she said. "It's just like fashion. Unless you are someone's prodigy, you're on your own. You will need the help."


Minkoff agreed that the people related to the product are sometimes just as important as the product itself. Referring to a recent startup that pitched him a few months ago, he said he listened to the company's pitch specifically because of the people that were involved: "When two or three of the core people have a lot of respect within the fashion circle, you are going to take that appointment or phone call because you respect them."


Focus on the data side of fashion.


Creating products that make fashion or shopping easier is tired, but one area that hasn't seen a tremendous amount of growth is the data side of fashion. Minkoff said brands are ready to hop on board with new products that make processes like inventory, data analytics, and shipping easier and smoother. While he admits this type of business-to-business startup might sound boring, data for fashion is "the heart and soul of where there is opportunity."


"The data and analytics side of fashion has been poorly underserved," he said. "There are so many little marketing and analytical tools waiting [to be created], and that's where brands are investing. This year, we spent a nice six-figure investment in tools to make our process more seamless. Don't forget the math side. It's a ripe area that needs help."


Minkoff said brands like Kate Spade and Tory Burch—which he referred to as the "holy grail of fashion" due to their e-commerce success—would eagerly pay for tools that would help them drive their digital strategies even further. Just make sure you price those B2B products appropriately.


"I get approached with great ideas, where an annual subscription fee could cost between $30,000 to $50,000," he said. "But if you want me to spend more on your product than the cost of everything else that I'm running my whole business with, you are probably going to have a problem."


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