A $15 million fashion business without clothes

Both businesses focus on the circular economy. eBay is about reselling, we are about rentals. Working together is the immediate next step.

While the partnership with eBay won’t change how The Volte is run, the two businesses will promote one another.

They will support our rentals, we will promote them as our resale partners, says Ms Olivier.

The fashion rental market is booming, with retailers such as David Jones and Country Road partnering with other players such as GlamCorner, a competitor of The Voltes.

Internationally, the Rent the Runway startup launched an underwhelming initial public offering in 2021 and saw about a quarter of its staff laid off last year in an effort to carve a path to profitability.

Ms Olivier believes her business model is different enough to weather the economic storm.

We don’t do inventory, he said. And it cuts our expenses down and ensures that we focus on one thing: renting clothes. When you keep your own inventory it dramatically shifts your focus. Business becomes one of logistics, delivery and laundry.

Consumers can rent their own clothing on site, and must handle all logistics including shipping, returns, cleaning, and any damage to the item themselves. Volte charges lenders a 15 percent commission and borrowers 13.5 percent, plus an optional $5 fee for insurance.

Ms Olivier also believes that the luxury price point of The Voltes clothing gives it an edge.

Our average dress sells off the shelf for $1500, he said, citing commonly rented brands such as Zimmermann and Aje.

Our customers rent out their clothes as an asset, just like you do with homes and Airbnbs. So they invest in providing a good tenant experience, and treating rentals as a business.

Consumer analyst Craig Woolford of equity research outfit MST Marquee says that there will naturally be a softening in the rental market post-COVID. To ensure long-term success, platforms need to ensure broad choice for consumers while protecting those who lend their assets, he said.

Many of these businesses have had tremendous success during COVID, says Woolford.

There is a huge demand in online retail during that time and it will come to the rental market. Consumers are coming back to stores now, and they have more choices. So I think the rental traction will soften.

Attracting repeat customers is also key, says Woolford.

What this platform needs is some amount of scale to succeed. A good inventory is one thing, but you need a wide range, styles and sizes to achieve long-term success. The platform that has that breadth will emerge as the winner here.

In October 2022, The Volte began working directly with the designers to introduce them to the rental market. Rebecca Vallance, Alemais and Kit X are among the initial offerings, and Ms Olivier says there are more to come.

Our biggest challenge is priority, he said. We offer luxury fashion for rent but until recently, the website did not reflect that, for example. This funding round will allow us to act like the company we know we can.