BROOKLYN, N.Y. ― On a September morning in Cobble Hill, Jennifer Hyman, the 37-year-old CEO and co-founder of Rent the Runway, was sitting criss-cross applesauce on her couch, her long legs clad in stretchy black pants. Newly married and recently back from her honeymoon in Italy, Hyman held her 6-month-old daughter, Aurora, on her lap.
Before running wild with assumptions, this is not a story about a “female entrepreneur” or a “girl boss” or a “She-EO,” degrading terms that reinforce the notion that a real leader is a guy. There will be no revelations about “how she does it” or “juggles” it all.
Please. This couch, that baby. It’s Hyman’s power pose. This is a story about a natural-born leader and startup founder, worthy of inclusion on any list of genius tech CEOs. Hyman, who nearly a decade ago came up with the idea of an online business renting expensive designer dresses to women who need them for special events, is a straight-up entrepreneur. No qualifiers necessary.
Hyman has raised $190 million from venture capitalists, who are notoriously less than generous to women, and her company, founded in 2009, is now closing in on so-called unicorn status, a term ascribed to outfits worth $1 billion or more. On Monday, Rent the Runway rolled out a revampedsubscription service and a national advertising campaign on TV, a first for the digital service.
But to get to that couch in that tony neighborhood in Brooklyn, Hyman had to run uphill through the sexist muck of the business world. She said she’d been called the C-word by a male colleague twice her age, dismissed as a “girl into dresses,” sexually propositioned by an investor and told she needed to “shut-up” and act more ladylike. She has also navigated her way through the subtle biases female entrepreneurs face every day. Some may never even notice them. Hyman does.
Being a woman trying to start a business is a “tale of a million paper cuts,” Hyman said during a conversation over a salad in the company’s downtown New York office in August. “The repetition of little slights over time that lead to women being in situations that are just slightly more difficult for them.”
Perhaps one of the more hurtful moments for Hyman came in 2015 after five former employees accused her of running a majority-female company with a “mean girl” culture, anonymously lodging their complaints in a Fortune article publishedafter five top executives left the firm ― some not voluntarily.
Then and now, Hyman said the departures were part of the natural order, the hard choices a leader makes when scaling a company up from two people to hundreds. That year she made some high-profile hires. Maureen Sullivan, a former AOL executive who’d also spent time at Google, came on as chief operating officer. Scarlett O’Sullivan left her perch as COO at Softbank to serve as chief financial officer. They’re still with the firm. The company’s former COO, Beth Kaplan, is still on its board. At the time, she told Fortune that the only mistake Hyman may have made back then was waiting too long to make staffing decisions.
Still, the story, which contained no specific examples of what that culture was like, did its damage. It certainly made recruiting more difficult, Jennifer Fleiss, who co-founded the company with Hyman, told HuffPost.
“It was almost worse than if the company had gone bankrupt,” said Fleiss, who left the company in 2017 for a position at Walmart but remains on the board. “The phrase ‘mean girls culture’ feels sexist. Is there a ‘mean boys culture’? I don’t think anyone talks about that.”
It is hard to imagine a male CEO getting hit as “mean” or creating a mean culture. In fact, Netflix ― a company run by Reed Hastings, a man hailed as a genius ― has been celebrated for its fairly ruthless culture. In company documents on its culture and values that surfaced in 2013, Netflix explains that if someone is performing merely adequately, they are fired but given great severance. Facebook Chief Operating Officer Sheryl Sandberg called it “maybe the most important document to come out of the Valley.” Amazon’s Jeff Bezos and Apple’s Steve Jobs have been celebrated for aggressive management styles.
Since that time, turnover seems to be fairly normal, especially for a startup. In the 250-person corporate office, the average employee tenure, including new hires, is more than three years, according to internal data. And over the past year, 20 former employees have come back to work at Rent the Runway after having left for other jobs. Among those working in operations (that includes the dry-cleaning business), turnover is less than 2 percent. Rent the Runway employs 1,200 people, mostly in its corporate office in New York and its operations center in New Jersey.
To be clear, Hyman’s story is not some kind of Horatio Alger tale of rags to riches. Everything about her upbringing set her up for professional success. She grew up in an upper-middle-class neighborhood in New Rochelle, north of New York City, the beloved eldest daughter in a family of three girls and a boy, surrounded by loving parents and grandparents. Her youngest sister is severely autistic, and her mother gave up a promising career in finance to stay home with the children full time.
And early on, she had the gut instincts of a killer salesperson. In second and third grades, the kids at her private Jewish school were tasked with selling Passover candy, which is typically non-dairy and can’t contain flour. “It’s disgusting,” Hyman said flatly. “I’d sell the hell out of it, more than anyone else. I’d go to untapped neighborhoods,” she said, speaking the language of a business school graduate. “I’d position it as something unique and interesting to non-Jews.”
While her daughter made little noises and squeezed a giraffe squeaky toy named Sophie, Hyman casually mentioned she was valedictorian of her high school class but insisted she wasn’t that into academics. She didn’t want to go to Harvard, but her grandfather convinced her. She would’ve preferred Brown, she said, where the students were a little more eclectic.
At Harvard she was just as successful. As editor-in-chief of the Harvard Crimson, she launched an annual feature on the 15 Most Interesting Seniors that’s still published today. She was among the founding class of one of the school’s first women’s clubs, the Seneca Club, created because men already had private social clubs where they could network. At Seneca, Hyman founded the Red Party, “literally the biggest party of the year,” she said.
But after Harvard came reality, and Hyman bumped up against what seemed like the only obstacle that would impede her almost pre-ordained destiny: She was a woman.
At her first job out of college, a strategy position at the hotel and travel company Starwood that she landed through a Seneca Club connection, Hyman’s boss, a woman about 15 years older, sat her down and told he she was too loud and enthusiastic in meetings.
“She told me to try to be sweeter. To listen more. That it isn’t coming off well for a woman to be so bold and confident,” Hyman said.
She cried. “Hysterically,” she said. “I’m bad at hiding my emotions.” It felt like she was being told to stop being herself. The moment was pivotal. “Had I decided to listen to her at that point, we wouldn’t be here today.”
After a few years at Starwood, there was a stint at a Los Angeles startup, but then Hyman returned to New York to be with her middle sister, Becky, who was sick with cancer, deferring starting Harvard Business School by a year. She took a job at IMG, a well-known talent agency that’s under different ownership now. Hyman was the only woman on an 80-person team in an environment that was “cutthroat and nasty,” she said.
It was at IMG that she learned what misogyny really felt like. After Hyman pulled together a multimillion-dollar advertising deal, a male colleague twice her age strutted into her office and let her know he’d be taking credit for it. “He was, like, ‘No one is going to believe that some 26-year-old woman executed this multimillion-dollar deal, and I have three kids and I’m taking the commission.’
“I was, like, no you’re not.” And, reader, he did not.
Hyman told her superiors the situation and got their support ― although only to an extent, because she says this man wasn’t fired. He even had gone so far as to email other colleagues at the company calling Hyman the C-word, she said.
“If this happened now, this guy would’ve been fired,” Hyman said. “But then people were given permission to act like that and you had to be really tough in order to survive. Most women who started there just quit.” This was only about 10 years ago.
At business school, which she started after her sister recovered, she didn’t have to fight too hard for connections. Hyman met her Rent the Runway co-founder, Fleiss, on the first day of classes.
“[Hyman] had a Post-It note with my name on it,” Fleiss said on a call with HuffPost, recalling how her future business partner came marching up to her during lunch. “We had a friend in common, and she said, ’So-and-so told me I needed to meet you,” she said. Hyman later told HuffPost that it was her sister Becky who’d suggested she meet Fleiss.
Fleiss and Hyman threw themselves into the business after school ended. After finagling their way onto the cover of The New York Times Business section before their business had even truly gotten off the ground, the article prompted Hyman’s boyfriend at the time to break off their relationship. Her new fame spooked him. He told her he didn’t want to be with a woman who was his equal.
As they built the business, fundraising in Silicon Valley was part of the deal, and so was that everyday sexism. One investor told them they were going to have so much fun “with their pretty dresses,” Hyman said.
Although Hyman’s investors now rave about her ― she emphasizes again and again how great they are ― she has no doubt that if she were Jim Hyman instead of Jen Hyman, she’d have pulled in a lot more cash.
Indeed, last year women got only 2 percent of the money flowing from venture capital firms. Part of the problem is that most venture capitalists are men.
Most of these investors mean well, Hyman said. But not all.
A few years ago, one investor propositioned her, both in person and then via sexually explicit texts. When she rejected him, he took his complaints to the Rent the Runway board. He told them Hyman wasn’t responsive and that was a sign that she was a bad CEO.
“The gall he had in trying to ruin my career was unbelievable to me,” Hyman said. At this point, Hyman had already raised tens of millions of dollars for her company. “This is happening to women in this industry and across many industries regardless of how successful they are, regardless of how much money they raise.”
She only recently started telling this story, opening up about it on an NPR podcast in August, during a time when people were talking about multiple other incidents of sex harassment in the venture capital world.
Hyman’s board of directors was disgusted when she told them about the investor’s harassment. “I was shocked,” said Dan Nova, a partner at Highland Capital, a Boston-based investor who sits on the Rent the Runway board, in an interview with HuffPost. “I had such an emotional response. I wanted to go ring the guy’s neck.” They stopped working with him, but at Hyman’s request didn’t take further action.
Other female founders have been less lucky in terms of support.
At Rent the Runway, Hyman’s been able to create something pretty rare: a majority-female company. Women make up half of the board, 70 percent of employees, 62 percent of corporate employees and an astonishing 75 percent of the executive team. The company says that overall, 71 percent of employees are nonwhite. But it doesn’t break down demographics further than that, so it’s unclear what percentage of the corporate employees are nonwhite.
One woman who works there sent me a video from a company gathering this summer where some employees were given awards for embodying the organization’s “core values.” Hyman, visibly pregnant, sings a company-specific version of Jefferson Starship’s “Nothing’s Gonna Stop Us Now,” with COO Sullivan, also pregnant, and two other employees. The song draws applause and titters from the staff.
“I spend a lot of time changing the words to songs,” Hyman said by phone the weekend before the ad campaign for Rent the Runway’s expanded subscription service was ready to launch.
These days, she also spends less time fending off overt sexism, but still, there are some things that make her think twice. When she’s out raising money in front of all those men, she still spends about half her time explaining why women buy a lot of clothes and want variety in their wardrobes, she said. That’s not something you’d have to explain to a room with more women in it.
She also said she doesn’t think she gets enough credit for having the vision to see that American consumers are increasingly moving away from buying stuff to renting it. She pointed out that she founded Rent the Runway before Uber or Airbnb were off the ground, before Spotify came to the United States, yet her company doesn’t get mentioned when people talk about the so-called sharing economy.
“Is that gender discrimination? I don’t know. The difficult thing is it’s hard to pinpoint.”
Published at Mon, 16 Oct 2017 09:01:09 +0000