How Style Theory turns into a regional fashion rental house

In 2016, Chris Halim and Raena Lim piloted a fashion rental platform called Style Theory. When the waiting list for the service grew to more than 3,000 people, the Singapore-based duo decided that the idea was worth pursuing.

They launched the platform in their home country and expanded to Indonesia in 2017. Although there are other startups, such as MadThread and The Treasure Collective, that also provide similar services, Style Theory stands out with its geographical coverage and funding.

Style Theory’s co-founders, Raena Lim (left) and Chris Halim / Photo credit: Style Theory

Since inception, the company has raised US$25 million, including a US$15 million series B funding round led by SoftBank Ventures Asia in December 2019. It also counts Alpha JWC Ventures and The Paradise Group among its investors.

“We saw an opportunity to raise more money – maybe a couple of millions more – in the next few months,” Halim tells Tech in Asia.

He claims that the company’s platform now has more than 200,000 registered users.

Fashion startup on the outside, logistics startup on the inside

Clothing rental is not a new business. Several boutiques have provided the service before. Typically, people go directly to these stores, rent clothes, and return it after they wear it.

Today, websites like Belsbee and TheDressCodes in Indonesia, Covetella in Singapore, Style Statement in Thailand, and Lola in Malaysia allow you to rent their collection of dresses and gowns online. All of these sites, however, focus on outfits for special events, like weddings or ceremonies.

In contrast, Style Theory focuses on day-to-day outfits. It provides a subscription service that lets users pay a monthly fee to rent unlimited clothes from its collection, limited to three to five pieces at a time. Lim likens the platform to a “cloud wardrobe.”

While the approach allows the company to retain users, it’s a nightmare from a logistics point of view.

“Our business is really unique,” Halim says. “Everything that goes out needs to come back. It’s very different from ecommerce that only needs one-way logistics.”

When he started Style Theory, the co-founder partnered with more than 30 third-party logistics firms and employed various warehouse management systems. He found that most of them did not invest enough money into their reverse logistics solutions because the segment is relatively small for a typical logistics business. For Style Theory, however, reverse logistics – the step in the supply chain that typically involves returning an item to the manufacturer – is equally as important as shipping products to consumers. An inadequate reverse logistics solution could cause a lot of pain points for customers.

The return logistics process is complex: Items should arrive on time so the clothes can be washed according to schedule, and the items must be checked whether they are counterfeit or not. The system should then understand where to store the clothes, so it’s easier to pick them up when another customer wants to rent them.

“We finally asked ourselves, how can we take it in?,” recalls Halim. “Can we enjoy the economic side of the business? That’s when we started to evaluate everything and build a logistics and warehouse system from scratch.”

‘Test first’ mentality

Sustaining growth