5 Fashion/Retail Startups to Watch

Fashion startups are increasing the competition for young consumers’ wallets, and making innovation a focus. Here are five to watch…

Young consumers are leaving a graveyard of retailers in their wake, as their fashion preferences and shopping behaviors are leaving long-standing brands struggling to figure out how to appeal. Last week we reported that Aeropostale is the latest mall brand to file for bankruptcy, and the latest victim of Millennials’ fashion industry disruption.

But as big brands try every trick in the book to figure out young consumers and maintain their cool cred, a slew of fashion startups is increasing competition for their wallets–and integrating Millennials’ and teens’ style and buying preferences into their DNA from the start. The food industry isn’t the only place where brands can lose ground because of young innovators. Here are five fashion/retail startups rethinking traditional models, and challenging the status quo:

La Ligne

What do you get when two former Vogue veterans, and a former rag & bone exec come together to create a line with “endless potential for what it could be and mean:” La Ligne, a direct-to-consumer women’s clothing startup with advisors from Kate Spade, Warby Parker, Theory, and rag & bone. The e-retailer, whose name is French for “the line,” sells high-quality clothing with minimalistic designs, mostly concentrated on variations of lines and stripes. Their competitive edge stems from being able to cut the middle man to offer lower-than-designer prices, as well as their editorial-focused strategy: “La Ligne will provide shoppers with three different suggestions for what to wear with each item in its collection, as well as use its website as a platform for fashion-focused editorial content.” Along with its high-profile advisors, they have also connected with their friend Leandra Medine of the blog Man Repeller to promote the brand to her 1.3 million Instagram followers.

Outdoor Voices

Watch your back Nike—Millennials may love you, but one brand is hoping to win them over by being the “anti-Nike.” Outdoor Voices is a three-year-old activewear company that is prioritizing fashion over athletic competition. Millennial founder Tyler Haney tells CNBC, “While you’re running over hurdles in high school track, that message makes sense. But I realized that there was a powerful combination about being feminine and athletic that wasn’t embodied in a brand.” Instead of sweat-drenched athletes, Outdoor Voices marketing and social media is full of fashionable people in more zen activities- jumping on the beach, or doing yoga with kids. Their direct-to-consumer model has earned them plenty of funding, and Haney has plans to be “the next great activewear brand.”

AUrate

Two Millennial entrepreneurs have set out to create the Warby Parker of fine jewelry. AUrate is a fine jewelry company that offers products direct-to-consumer and without the retail markup. Since June 2015, the brand has seen a 300% growth rate in sales, with many of their items selling out in less than a week. The two Princeton graduate founders were inspired by a “a true void in the marketplace,” and by cutting out the middleman are able to offer prices that are 50% less than competitors. The brand also donates a book to a child in need with every purchase.

TheRealReal

Our Blurred Luxury Lines trend found that 81% of 13-33-year-olds say if a luxury product is passed down or sold second-hand, they think it should still be considered “luxury.” They can hunt down that second-hand luxury on ebay, but that hardly feels like a luxury experience, and the site is full of fakes. The RealReal has made luxury consignment their focus, and they just raised another $40 million to keep growing. The site authenticates the goods sold, so that buyers know they’re getting the real thing, not a knock off. Once an item is sold, the company pays sellers an averge of 65% of the purchase price. The startup reports that they sold more than $200 million in merchandise in 2015, and are on their way to becoming profitable.

Kit & Ace

Trendy/comfy apparel retailer Kit and Ace is opening pop-up shops in seven hot hotels. Born out of Lululemon, the fashion start-up focuses on comfort, places importance on transparency, and markets heavily at festivals. The pop-ups, called The Carry-on, were inspired from customer feedback that the clothes are “great to travel in,” and the co-founder’s own observation that travelers are wearing Kit and Ace on flights. The brand set out to create clothing as comfortable as gym-wear, but as stylish as street-clothes, fitting right into Millennials’ current athleisure preferences.