When James Reinhart, 34, was getting his startup off the ground, it wasn’t the sexy thing to do. In 2009 the economy was tanking and investors were snapping their wallets shut. Business schools fumbled around with entrepreneurship offerings or overlooked them altogether. “You were different if you were going to go and start a company,” the Harvard MBA recalls. “But I think the school recognized that [entrepreneurial students] were a really important part of the community.”
Reinhart didn’t intend to be an entrepreneur. He had enrolled in Harvard’s dual-degree program in business and public policy to pursue a career in education. Then, the “ah-ha founding moment” struck. Reinhart was staring at a closet full of clothes that he didn’t want to wear when he realized that “there was not an efficient way to refresh your closet.” The observation led to thredUP, an online marketplace for second-hand apparel.
Reinhart pulled in Oliver Lubin, a friend from his undergraduate days at Boston College, to flesh out the design, and they entered the idea in the 2009 HBS New Venture Competition. The duo walked away with semi-finalist accolades. Fueled by their success, Reinhart brought in HBS classmate Chris Homer as CTO, and they launched a peer-to-peer clothes-sharing site for men and women’s clothing in September. Seven months later, after only lukewarm success, they pivoted to children’s clothes, where “forced obsolescence” guaranteed a steady stream of customers.
The experience wasn’t seamless, especially when it came time to raise funds. “We were building a new idea on a new platform with an unproven team,” Reinhart says. So they turned to family and friends for funding, kept building the site, and attracted more users to prove their business plan. “The perseverance thing is a cliché, but it’s true–when you can’t raise money because you don’t have proof points, you just keep building proof points,” he says. “You work for free, and you’re passionate about it.”
The gambit worked. Investors have since shelled out some $23.1 million to grow the retail business. Reinhart has big ambitions for thredUP’s future. “I think we can build an enormously successful, large ecommerce company,” he says. “The second-hand space in apparel is close to $30 billion, and nobody has really cracked it online.” So far they’ve made a good start. By April 2013, the site was again offering women’s apparel, and the founders are already eyeing maternity and men’s apparel for their next move.