Riviera Holdings VC Podcast EP4 Phoebe from Taelor

Welcome to our podcast. Today we have Phoebe from Taylor joining us. We actually talked to Arya just last week. So thanks again to Taylor team joining us on our podcast for the second time here. So welcome to the podcast Phoebe. - Thank you, thanks for having me. - Thank you. And if you don't mind, can you give us a little bit background about yourself, your company, and then we can get started? - I'm sure. So I'm a co-founder of Taylor. So I met my co-founder, Arya Chang, back in Chicago when we did our MBA more than a decade ago. So we have very different background. My background, before started Taylor, I was in a VIPO company in strategic sourcing operation strategy and finance background and my co-founder in marketing and tech. So we decided to join him and start Taylor together about three years ago. So Taylor, we hope busy men to look great seamlessly with our air styling and throughout rental and resale model. So how he works is you sign up for monthly subscription here at FixV and our professional stylist in the AI. We use the AI to pick the perfect outfits for you. Whether it's for your day nights, for work, travel, or focus on every day occasion, and you receive the clothes, you can wear the clothes for a week or two weeks however long you like. And then when you are ready to return, you just return the dirty clothes. So no more shopping, no more laundry. You can look fabulous every single day through Taylor. - That's very good, thank you for the background. So if you don't mind, if you look at this, we tell fashion, I'll get it's a big industry. And how do you end up picking man, subscription closing, being the focus, how did you end up finding the product market for all your company? - Yeah, it's a personal journey actually. When we first started, we actually want to do it for ourselves. So I've been using the Clothing Rental Services for years, almost eight years now. So most people probably have heard of our rental runway. My they are Clothing Rental Services for women. They are the pioneer of the rental business model. I've been using it for a long time, if it fits my lifestyle perfectly. And because I am very picky when it comes to fashion. Right, and there is specific about what I like. I do want to look great by hey shopping. I don't like to buy a lot of stuff on the minimal let's buy a nature. So the business model, the rental, you can wear different clothes and you don't really have to buy them, that's brilliant. And that's why when Ann Yamaikovar and I decided to start our own adventure together, we looked into the space, the circular fashion. And we learned that wow, the circular fashion model or distribution, it's only it's growing. It's a foster growing business sentiment within the fashion industry. Right, we also learned that the consumer behaviors are also changing, you know, especially the younger generation. And you don't really have to own that much stuff, right? So we know that the sharing economy is impacting every single industry. Fashion as well, right, the world is becoming more secular. In the fashion industry, well, if you look at the second hand sentiment, it's a foster growing distribution channel. It's growing nighttime, fostered in the regular, the overall, traditional retail, on the e-commerce, only the fashion industry. So, and then why men? When we first started, we actually wanted to do it for ourselves. Why, oh my cool part of it myself. When we look into the space, there are players in the market already like run the wrong way, you know, solving the problem for women. And the problem that we really want to solve is for people who hate shopping. They don't know why they look good on them. They just want to look great seamlessly, right? So we decided to create a different journey to help them look great seamlessly. So that's most men, the mainstream men, they hate shopping, they hate laundry. They don't know why they look good on them, right? But they do want to look great. They just want a better way to look great. That's why we decided to focus on the men's markets, you know. Thank you. So, if you focus in the men's clothing, how competitive is this landscape? We're talking about, do you have any other key competitors? And then if you could also share how do you overcome some of the competition? Yeah, I mean, we know that the, you know, fashion industry, the fashion market is huge, right, you know. We all need to work close, so it's definitely huge. So the way we look at it is, it's an evolution, right? So, back in the days, people go to brick and model. This is model, right? And then we have the e-commerce and subscription model. And right now, it's a circular fashion model, which is booming. So, I think it's just how people experience fashion in terms of, you know, the option out there, the rental model for men. And we are definitely, you know, the leading startup company solving this problem. They are option for men, you know, such as, you know, statistics, the subscription models, right? So, I think the way the cater to customers are very different. So, the statistics, for example, you do have to buy the clothes, right? For our, for our business model, our tailor, you know, it's rental. So, the idea is, why buy something that you don't actually, you don't even know if you like, right? The fact that, you know, the majority of us, you know, we only wear the same thing again and again. We only wear 25% of what we own in the closet. So, our business model and, yeah, try, try before you buy. You don't even have to buy, right? But you only buy, when you do want to buy, you only buy what you love. So, that's why the optional dev kept, different options. But I think the way we solve the problem is very different. Gratitude. Thank you. And this is rental and a subscription model. One of the topics in the last few weeks has been on the changes in tariffs. Any implications on grants or versus traditional retail market, like just buying, closing, like any implications to you and your company, specifically? Yeah, no, this is the first thing that I think all businesses will need to earn closely. So, I don't know if you know in the fashion industry in the US, and anything that's made in the US fashion, the mix in the US is actually represent about 3%. Local domestic, right? So, can you imagine, 97%. So, that means the tariff is actually impacting, you know, the majority of the industry, right? Not just tailor, you know, in the rental or secular model, or the fashion companies, you know, will be impacted, even the big companies, because the collection, your codes are made outside of the US, right? So, it's going to impact the textile, the production, and the distribution, the retailers across the distribution channels. So, it's definitely something that, yeah, you know, we have to monitor the impact on the cost basis, or we can find, you know, different market. In doing the best of swimming for our customers, the good thing for tailor is because of business model, we don't only work with one brand. Right now, we have over 300 brands on our platform, right? We are targeting busy professionals, our customers. They don't care so much about brands, right? They don't come to tailor because they are looking for specific brands. They come to tailor because we can help them to look great. Why did you care about quality? Did you care about comfort? Did you care about, you know, something interesting, you know, they were elevated, how they look. So, good news is when it comes to fashion, quality doesn't equate to price, right? So, we can find a lot of high quality coding brands to work with, right? For example, in Turkish, Turkish is one of the higher quality countries, you know, when it comes to apparel or coding, right? So, we are focusing more on certain market that's less impacted by the turf, and they also produce, country, they also produce high quality codes. We are in touch with several brands. You know, in Turkish, for example, tailor overall our strategy is to bring the best menswear brands to our customers, right? Not only the U.S. homegrown menswear brands, but also the international brands, right? So, provide discovery, experience for our customers. At the same time, yeah, we find ways to relocate a driver to cause across our business model cost structure. My one way is AI, right? That's why the technology is really, really important for our business model. And also for our customer experience, right? How can we continue to enhance our AI model to reduce costs one way, of course, to elevate the experience for our customers? That's very good, yeah, you mentioned AI, so I assume you're trying to create experience like an AI personal assistant or AI personal stylist for your customers. Can you share a little bit more about your AI application to your company and your customers? Yeah, sure. So, yeah, I mentioned a little bit earlier that your customers need to come to us because they want to look great. They don't necessarily want to pick their own clothes. So, imagine you're having your personal stylist, right? The celebrity has personal stylist, you know? Some people yes, they hire personal stylist, you know, to find the best outfits, including for them. So, if we have to scale and grow fast with personal stylist, yeah, that's definitely more challenging. And with AI styling, we are using AI styling to help our professional stylist to pick the perfect outfits for our customers, right? And we do have personal stylist because our customers do like to interact with our professional stylist. And right now, we are using our personal stylist, you know, working closely with our AI engineers to continue to enhance our AI cool AI styling tool way to help them to find the perfect outfits for our customers because, you know, our customers, they are with us, they stay with us for a while, right? It's very challenging for our professional stylist, you know? They are very skilled, but to read through all the information, you know, the customer's profile, what they like, what they don't like. After the customer being with us for a while, you know, they make a lot of comments, interaction with our stylist. And then at the same time, we have thousands of styles. Our collection of Swarm and Continued to Change. Every single week, every single season. So that's very difficult for a human stylist to optimize their selection. Why, how can I find the best outfit for your hand, right? You know, as our collection of Swarm and Continued to Change. So with AI, we use embedded imaging technology, you know, to create unlimited attributes, right? And now we can process and structure information. For example, the interaction between the stylist, the human stylist and our customers. And to process all the information, structure and structure, imaging to create unlimited attributes or products. Then we can, you know, find the best outfits, you know, for our customers across different personas. And which is very fundamental, you know, to our business model, to our growth. That's very important to your point. As you mentioned, you are growing. And you have more than thousands of skills, over like 300 brands. So it's important to be able to scale at an leveraged AI's solution to scale efficiently. So coming back, the 300 plus brands you have, I like you are working on the B2B side, but then you are also directed to the consumer B2C. So can you share with us a little bit more on your B2B, like any other partnership you're working on? And how do you tie it into your B2C direct to consumer channel? Is it on the clothing cell on the consumer side? If you don't mind, you can share both. Yeah, okay. On the supply side, yeah, I think this is also actually I want to touch on another problem that we are solving. As you know, the fashion industry, it's one of the most polluted industry in the world, right? It's actually responsible for 10% of the carbon emission in the environment. That's why our business model also played a part in saving the environment throughout rental and recent model. And so right now, because our business model, we also create the opportunity for all the brands, international brands, emerging brands to tap into the circular fashion business model, right? So they all know that it is a growing sellments, but it's going to be a huge investment for that to tap into the rental. You know, suddenly yes, the people rental business model, right? But they don't have to do that. They can just bully Taylor, partner with us, right? They can send their clothes to us over the amazing clothes to our customer base, right? So that's how we panel with them, we panel with international brands. They are interested to tap into the rental and the result, this is model. And by partnering with us, they can immediately, you know, get into this new distribution center which they know it's growing. And too, you know, by partnering with us, they can also gather a lot of data. They back from our customers, which is really unique because our business model, we are stalling company, essentially. So we receive a lot of feedback from our customer, what do they like, what don't they like? Right, they are more willing to give us their specific feedback because they don't want to get better clothes in the next shipment, right? And at the same time, because of our business model rental, we do wash the clothes of the full cycle, we know the true quality of every single garment, right? So our partners, now, you know, they really value about the feedback, the customer feedback, you know, the product feedback, they will provide them. So they actually help them to improve their production, improve their designing, their new collection, right? And so that, you know, we can help them to create the best products that's actually more sustainable, long-lasting, which is better for the environment. And then this is really important because we partner with emerging brands from all over the world and then bring them to introduce their branch to our customers. And at the same time, I own the, on the customer and the consumer side, yes, we are working on the B2B side partnering with companies to offer our service to their employees. This is something that we just started to explore. So our own customers, they've been reaching out to us like the executive leaders and their companies and they've been using the service for a while, the love tailor, you know, for their own personal fashion looks and they ask, hey, can I use tailor for my employees? Like, can I use tailor for my team, right? So right now, we're talking to our sales team, consultant, law firms. They are interested to partner with tailor to offer our service for their new employees or their employees' perks, especially, you know, people facing professional, they do want to look great. This is the area that we see a great potential. - That's very good, congrats on all the new partnership opportunities. Can you share with us that the difference between B2B partnership opportunities you're talking about and then the dynamic versus B2C direct to consumer. What are the differences you are seeing between the two different channels and the different challenges? - Yeah, so we started on the B2C, obviously, which is a very, very important growth market for us. I think focusing on B2C is really important and because B2C, we get directly back from the customers, right? They sign up, you know, they pay for the service, right? And right now, we listen to every single customer. When we have a chance, we invite them to join me and my co-founder, interview them, how we can continue to improve the experience, right? I think you get that one-to-one relationship with them and then they will both continue to fine tune, you know, our products, our offerings. And then, with B2B, I think the dynamics is a little bit different, so now we are partnering with companies, I suppose, so directly with the consumers, right? So I think the feedback is slightly different, right? Of course, the end user is due to the customer, the employees, right? But the company are actually paying for the service. It turns a bit different, but it's good for us to start or to learn to service on B2C, so that we can get directly back from our customers, really understand their pain point and the help us to build the best products that we can offer to, you know, B2B to see a B2B right now to companies, right? And we B2B, you know, because we are working directly, right? With businesses, you know, more on the partnership contract basis, whether it's for three months, six months, or a year or longer. So the retention is also great, right? Well, this is model, it's just different. So right now we're talking about, hey, this is a one-year engagement benefits, right? It will also give us time, you know, to continue to enhance, to improve the program, so enhance the experience, both for the companies and also for the employees, right? This reason why, you know, they want to partner with us, so we want to make sure that, you know, through the engagement and give us the opportunity to continue to increase the value to the company, whatever it is, yes. But more sustainable experience will offer to, you know, the employees, right? New employees, for example, more than just the coffee marks, you know, again, another coffee mark is with a new company, right? Something different, something that can actually wear and feel good, look confidence. Yeah, that's very good. To your point, you'll be to see your consumer, they provide feedback and some of them also become your potential B2B partners as well, right? And then from your B2B, potentially, some of the employees ended up liking you and they may set up their own. We tell them they're different now. So I think it's like a feedback loop, but they're also helping on both sides. That's very true. It's true. Some of our customers become ambassadors. They refer on their family and friends, right? They also introduce, you know, their own company. So they become our best ambassadors, you know, in different channels, including B2B. That's very good. And you mentioned pain points earlier. Can you share with us how do you figure out the pain points company and then maybe if you can share before Taylor, by some of your prior experience, how do you leverage your prior experience and expertise to this company? Yeah, that's great. Before Taylor, my profession was in Operation Strategy International Optimization. That's my, that's what I did for a long time. Why? So what that means is, you know, imagine as a consultant, Operation Strategist, you're going to business, right? Understand, this is model, the processes and fire opportunities to improve the business model, to improve, you know, the process. A lot of times it's bottom line. How can we turn the companies around the operation around bottom line? And since it's impossible to do everything, right? So you have to really, really focus and identify the main areas that you can turn around with the company, you know, as soon as possible. You know, there's time, you're trying to, our time in impact, right? That's really important. I think that training is definitely very helpful for me, you know, as an entrepreneur now running my own company. Getting just strategically understand the pimple of customers, right? I think through the data that we receive, we definitely is also very data focused. And we be to save our customers very quickly, as we get a lot of feedback, a lot of data from our customers. In different ways, we get our information also through into these. Right? There were helpers to understand the impact, right? Which pinpoint, you know, we should be focusing on. And then there were helpers to continue to find, you know, offering our products, right? Because, you know, not all customers create a equally, right? You know, it's really important for us to really focus different customers, right? And then find the best way to solve the pain point and across different personas, in our case, customer personas. And a proud time is accordingly, I think that's a really important. That's very good. Thanks for sharing the insights. And can you maybe share with us some of your maybe upcoming milestones in terms of product development or partnership, opportunities, to the extent you can share with the audience? Yeah, sure. So we are excited to partner with Amor. Amor is a coding rental services. They are based for women, they are based in Seattle. So we also interested to enter into the big to be markets, right? So they've been around much longer than Taylor. And so we are working together or to partner with companies because it's really important to have men and women offerings, right? When we started this conversation, even when our own customers were in their approaches, and then it's all great. Yes, it makes a lot of sense. So my team can use tailors, but then the conversation will go to weights, but you only do men. Her family employees, right? So you have to also have the offering for women as well. That's why right now we partner with Amor so that we can have a more inclusive offering when we partner with companies, which is really exciting. That's very good. Thanks for sharing with us. So we are pretty much coming to the end of the podcast. And again, thank you. And then also Arya, working with us on two podcasts here. And if I may, the last question would be, if you can share one advice with our audience from your startup journey at Taylor, what would be your advice to share? Good question. Yeah, I would say we get asked a lot. Yeah, who's the startup genius compared to the corporate life? When I think I used to enjoy, I get this question out. I used to enjoy it right after three years. Dan says always, yes, I think it's really rewarding but when I first started, you know, I knew that this is not a two years or three years. It's a long time commitments, right? I think it takes a lot of commitment and to stay on, never give up. And for sure, yes, you will face challenges. No one will say, when someone tell you, yes, it's easy, Jenny, they lie to you. Thanks for sharing. It's not easy. I just, I think the exploitation, I knew from the get-go, yes, it's not gonna be easy. And I have the commitments to continue. And for me, I feel like I have the commitment to my employees, my team, also our investors who trust us, you know, trust us. I know myself why I feel committed, you know, to deliver, to make Taylor successful. The good thing is, because I'm personally also passionate about the circular business model, you know, how we can disrupt the fashion industry, making more sustainable, you know, why do we have to buy everything? We don't have to, right? And there's a better way to experience goods. There's a better way to experience fashion. So I think that's also how, so because it's something that's unpassionate about personally. So, and I also advise you as on the audience, you know, if you haven't tried the business, the rental model, give you a try, you know, if you're someone who is shopping, hey, laundry, don't know what to do good on yourself, try Taylor, and we offer, you can use the discount code podcast 25 to get 25% off first month. So ladies, you can sign up with our partner Amu, right? So give you a try, you know, why buy something that you don't even know you love, right? I'll try the rental model, it'll be great, seriously. Thank you, Phoebe, it's great talking to you. I enjoy the conversation. And again, thank you, you and I and Taylor team, helping us on our podcast. Well, thank you, and thank you, everyone, for listening.