“I say being naive is one of the best secrets of first time entrepreneurship.” - Jenny Fleiss

On today’s episode, you probably recognize the name of this entrepreneur's first major company, Rent the Runway. Well, she co-founded it, alongside her business school classmate and a No Limits podcast alum, Jenn Hyman. And while she’s still on the board of Rent the Runway, Jenny Fleiss is now the CEO and Co-Founder of Jetblack. Jetblack is a personal shopping service via text message, which was born out of Walmart’s startup incubator. And what I think is really interesting about Jenny’s story is that she was able to create this company with the backing of an enormous organization, Walmart, or as Jenny says, creating a template for innovation inside one of the largest retailers in the world. I think this is really an interesting story for anyone who is working inside a big company, maybe you’re not sure you want to take that leap and build your own thing. Well, it’s possible to do it from within. Here’s Jenny to tell you how she did.

RJ: Jenny Fleiss, Welcome to No Limits!

JF: Thank you! Thanks for having me.

RJ: I'm thrilled to have you. Our listeners will know your co-founder of Rent the Runway, Jenn Hyman, she's been here on the podcast and I want to talk to you about Rent the Runway, a company you co-founded with her, but I also want to talk to you about the work you're doing now with Jetblack. You're the CEO and co-founder. Jetblack falls under the umbrella, the roof of Walmart. Yes?

JF: That’s right. Yes.

RJ: And I think it's fascinating; most people leave like the really big company to go found the smaller company, which they hope to become the big company. You sort of did the reverse.

JF: Yes, that's true. Yes. So, Rent the Runway was definitely a startup from the ground up. It came out of a concept that Jenn and I innovated on while in business school. And now starting a business within the world's largest retailer, it is the reverse in many ways. But I think that's where I'm able to add unique value and perspective. And, you know, one of the things that was most exciting to me was actually creating a template for innovation within the world's largest retailer. But I have seen just how I can leverage the resources and infrastructure of that business to move even faster in growing this company. Day to day, stand-alone, we have an office in downtown New York. We've built our own team. We have a board just in the way you would as a startup. And that's kind of how my touch with Walmart feels—like the way a VC and a startup would feel.

RJ: What was the turning point? What made you think this is the right decision to move on from this thing that's your baby and you built it from the ground up out of business school?

JF: Yeah totally. Yeah, well, I still have a super sweet spot for Rent the Runway and I'm so proud and passionate about that business. It was such an amazing career opportunity to grow and build that company with Jenn. From earliest days, Jenn and I were really open about kind of who we were, our intentions, what we loved, and I'm a serial entrepreneur at heart. Every day I am seeing a new problem, thinking of a new solution. I have to hold myself back on starting and working on new concepts all the time. And so, that energy and that drive to work at a really early stage startup really started to get a little bit lost as the company grew. I was still kind of itching for that 30 person team in a room, all crammed there working on an early stage concept. And so, you know, I think the open dialogue we'd had around that had been really helpful and timing is everything. And Marc Lore reached out with the chance to start Jetblack and I'd wanted to work with him. I've known him for a while and really admired him. And then the chance to do it in this huge retail environment and to have that impact on millions of consumers, if we get it right, is super exciting.

RJ: Marc Lore is the founder of Jet.com that was purchased by Walmart. So Jetblack is essentially a part of jet.com?

JF: Well we didn’t actually even have to use the name Jetblack. We chose to. So, it's associated with Jet.com, but we operate day-to-day standalone. You know, I love having the name because it drafts off of the brand equity and the awareness that Jet has created for an urban consumer, but really, Jetblack is a personal shopping service over text message, stand-alone business. We buy some products through Jet.com, we buy some through Walmart. But we buy designer handbags from Gucci, we buy things from Saks, we buy Blue Mercury products, you know, all over the place. It could be whatever fits a customer's need.

RJ: Michael Strahan and I talked about this on Good Morning America not that long ago. Essentially, if I'm desperately looking for a last minute gift, I text you and you text me back with options?

JF: Exactly right. So, you can text us your need. “Hey, I've got a birthday party. Recommend me something.” You could just screenshot the paperless post invite. Send it our way. We immediately know, you know, the age of the child, the theme, the date of the party, the location if you want us to send it to the location, we can do that. So, we have requests like that where it’s for a gift. We have basic things like laundry detergent, paper towels, and we start to know and learn those preferences, so that you could literally just say paper towels. We know the skew size. We know the brand that you prefer. And so I call it like “click-free shopping,” right. It's like, “Great! Your order’s confirmed for this and it will be there later today.” Or we have people who are buying designer clothing and apparel or snapping a photo of something they see on the street that someone else is wearing it. And they're like, “I want that. Can you find that or find something similar?”

RJ: You can do that?

JF: Yeah, we can do that! We have a mix of technology and people kind of tracking these items down. And we do try to get it to you as quick as possible, often that is same or next day and over time, you know, we're considering how do we just scale this to be bigger and bigger. Right now it's in New York, but it has the potential to be all over the US.

RJ: So what's the biggest challenge for you at this point? It's still a young service.

JF: It is still young service. You know, I think the biggest challenge right now is just scaling the business. So, the first year was about getting the product market fit, right. So, talking to thousands of consumers and figuring out what was missing in their shopping experience and I think the main thing that we heard from them was shopping had become a chore. It was something to check off their to-do list, something that they had to get done and it can be the case that shopping can be delightful. So, we thought about like how could you bring back that delightful feeling of shopping, of like magic and the way, I think, two-day shopping used to be actually delightful like five years ago, right. What was the next version, the next ideation of that? And so, it was with that kind of big vision that we set out to kind of innovate on creating Jetblack and making that customer experience really optimized. And I think, as we enter this, you know, next year of life of the business, it's really about how do we scale the business, the unit economics, the model, so that we can grow it and make more people have the opportunity to experience this. Technology is a big piece of that, right. So, right now if you text us, there's a mix of bot and human that is interacting and responding. And as we get smarter on your preferences more things can transition over to bot and that's what will let us scale the business over time is building up this technology, so that we can make the service really robust.

RJ: So, for those of our listeners who are new to this idea of a bot, like basically you can, because of A.I., you can text nowadays with “chatbots” and those “chatbots” can respond to your questions in real time. How far away are we, do you think, from that being almost like the primary, first-case scenario for most customer service?

JF: Yeah, I still think we're far away. If you want it to be quality customer service. So, what is very frustrating, and we found from customer experience, is that many chatbots or users of A.I. and technology kind of throw it out there and lead to frustrating consumer experiences, which is why for many voice devices, for example, consumers don't shop on voice devices right now. They may listen to music, they may set timers—things that are kind of like one way requests and commands that they are going to make. But it's not yet that the technology is good enough from maybe a back and forth interaction or for layered requests where there's some specification and differentiation. So, we've taken an approach of like a human-first approach, where we actually said, “We don't want the customer to ever be frustrated.” So, we have human eyes on every conversation. So right now, even if there is a bot who says, “you know what, they always say paper towels, they mean this one.” That's a really easy bot response to replenish their paper towels. There's still going to be human eyes on that interaction because if there's a follow-up question, if there's a subtlety, we want to kick that over to a human. And I do think over the next, let's call it five years, we'll get to a place where the data is good enough that A.I. can take over so that 10% of the interactions are human and 90% are bot.

 RJ: Wow. 90% in that span of time?

JF: Yeah, I think we can really get there in the next five years.

RJ: I want to talk a little bit about your career because you grew up here in New York City, you went to Yale and studied Political Science—

JF: Yes.

RJ: Were you going to be a politician?

JF: No, I don't think I was ever going to be a politician. I studied Political Science because it was truly like the courses that I was most interested in, the professors I most wanted to take were in that section of the handbook. And so, it was like I can take classes that I like and not be forced into having to take XYZ, and that's what I wanted out of my college experience, right. I wanted to really spend the time doing things that I enjoyed and was passionate about.

RJ: And then you went into finance?

JF: I did. I went to finance. So, in the career services office at that time, I graduated in 2005 from Yale, it was like finance or consulting. That was who came to campus to recruit. That was where, you know, all the smart kids were kind of competitive and vying for those positions. I'm a competitive person, so I got sucked into that whole thing and, you know, it is this irony where like you spend 20-21 years of your life like heads down in school and all of a sudden within a couple of months you’re asked to make kind of this career decision. And I often, you know, I had internships every summer, but I don't know that I stretched the boundaries on trying different types of internship experiences. So, growing up in New York, finance is what's there. So, I almost defaulted to my connections and like the competitive jobs of having these finance internships so, I was almost never able to see anything other than that by the time it was time to make a career decision. And that includes, like I tell people, and it's not only about industry, it's also about the size of a business. So, don't just test out what, you know, consumer packaged goods versus finance. Test out like small, big, startup, all those things, so by the time you're making that permanent choice you're really informed.

RJ: Were you not happy with the choice?

JF: I wasn't very happy with the choice.

RJ: I started out in investment banking and I was really unhappy. Although looking back, in retrospect I'm glad I did it. It was a good foundation. But the actual experience of it was painful and not enjoyable.

JF: Probably, for me, somewhat I would even say traumatizing. But I describe it similarly. Where looking back, like I see I tend to see the good in things right. So, I definitely value and appreciate the skills I learned, the fundamentals, the network that I built, and some of the people on my analyst class are like just doing cool things and I'm still connected with them.

RJ: I married one of them. My husband was in my analyst class一

JF: There you go!

RJ: And that worked out for me.

JF: See, good things can come out of finance and banking! I also kind of, I say it jokingly, but I when I interview someone, I know that if they have worked in finance and banking, like they've got what it takes. Like they know what it is to hustle, to work hard, to like you know一

RJ: Hundred hour weeks.

JF: So, I think it also like I had that perspective. But yeah that said, I went to business school because I wanted to do something that I loved and I truly believed that work could be something that energized me and made me excited to go into the office and work every day.

RJ: Do you think business school today is what it was when you went? And do you still see it as something where if you're in something today that you're not satisfied with, it's a good place, if you’re thinking business, that it's a good place for that pivot or coming up with the pivot?

JF: I do. So, okay, so a couple of things in there. So, I think I tell people, if they're thinking of business school, you either should go because you want an industry or a career change or because you're burned out, you've been doing the finance-banking thing and you kind of need like a couple years just mental reset, even if you're gonna to go back into that lane, right. And I think those are both good reasons. And so for me, it was in that former bucket of like, I thought I wanted an industry or a career change, and what wound up coming out of it though, was slightly different right. It was more than anything, I think just the mental brain space to like think, digest, to be in like a different environment where I was taking classes, but like vocationally minded classes that were like in a business contact, so that was not like my undergrad experience, right. And kind of more of this political science and liberal arts education. Like you're not thinking about like, “What does it actually look like to be working in X industry Y industry?”

RJ: You're learning for the sake of learning, you're learning how to think, you're learning how to dissect ideas, but it's not specific to an industry.

JF: Right. And then to be amidst classmates who have worked in these different industries and to kind of hear directly from them in an organic way of just getting to know people is also really telling and so, you know, that is where where Jenn and I met and I think our seeing each other in the context of a classroom and how we thought about different business issues and principles was such a great foundation to build a company and to innovate. And I think the biggest thing I realized at business school is I'm an entrepreneur at heart and I did it through, you know, I took career studies and career tests and stuff too, but just went back to like me as an 8-year-old who wanted to spend every summer day running a lemonade stand. And that was like what energized me and I loved it.

RJ: Did any of your—how did you discover, “I'm an entrepreneur at heart”?

JF: I can’t—I don’t know.

RJ: What was the test? Did you take a test—

JF: Yeah, I did take a test.

RJ: That said you are an entrepreneur?

JF: Yes like I took this test within the first couple of months of being in business school. I think they have most everyone take it and the test is like lots of questions. I don't know that they asked about my childhood, but just personality traits more like, you know, Myers Briggs type things. And I remember sitting down with a career coach afterwards and she said, “You're 98% entrepreneur.” She's like, “I've never actually seen something like this,” right. And at that time, because I started business school in 2007, there wasn't like a template or model of like well what now. Like what do we do with that knowledge that Jenny is meant to be an entrepreneur in the way that there is today. And so to your question of like what's changed since I graduated business school, over five years ago now, I think that entrepreneurship is more of a thing and more of a career choice, path. I think for all business schools you see a greater percentage of people going an entrepreneurial route, either working in a startup or starting their own business, whereas I really had to kind of think about what either career path would give me the entrepreneurial skills, or eventually thought I was going to go work at an early stage startup because I didn't know if I was ready to yet do it on my own right out of business school.

RJ: And you and Jenn famously came up with Rent the Runway. You had that first meeting with Diane von Furstenberg一which people, if you want to hear the full story, you can listen to Jenn Hyman's podcast here. One of the things that I really admire about what you two built with Rent the Runway, in addition to the business, is that you created this foundation Project Entrepreneur, where you're helping other women entrepreneurs. Did you go into the company thinking eventually we want to also have this other arm? And how did you build out that other arm when you were so focused on building a business at the same time?

JF: Yeah. Oh great question. It's been such a privilege to not only build Rent the Runway, but the Rent the Runway Foundation and our first program there, Project Entrepreneur, is a combination of summits with action-oriented workshops and then an incubator. And when Jenn and I started Rent the Runway, we didn't have this, “Yes, there will be the Rent the Runway Foundation,” a plan in that sense, but we did both share a passion for empowering women. And I think in our first couple of years, we really took advantage of and saw how our network and so many entrepreneurs who are generous with their time was critical in helping us in our journey. And so what一we felt very lucky and grateful to have that. I think we also gradually started to see as the business grew that female empowerment was part of the Rent the Runway brand, and it was in part because Jen and my story became tied to what Rent the Runway is, and how we were women going after our big vision and dream, and the community felt that kind of energy as well, and many of our consumers are power-business women, and they're using our dresses to kind of take on the next career move in their life. And I think wearing a great outfit makes you feel confident and empowered. So, it was very authentic and true to what we were. Why we decided to start it in the throes of still running Rent the Runway at the time and now running another business is because those were who we learned the most from ourselves, so, we found the most value from other entrepreneurs who were still in the mix of the day to day. They were maybe a couple of years ahead of us, but they always kind of一whether it was they knew what the price per square foot of an office space was, or what health care provider we should talk to, or just expanding and leveraging their networks, they had that real hands-on skill set that that was valuable to us. And so we believed that we could offer that through an incubator program in a really unique way to women and wanted to pay that forward.

RJ: And to your point, there is so much about being an entrepreneur that isn't the business itself. I mean the healthcare provider, where you locate, the cost. Those aren’t things that most people would think of as like fundamental to the business idea. But if you get those wrong一

JF: Yeah.

RJ: You don't have the business.

JF: All that infrastructure type stuff can just take up a lot of time, especially in the first year. That's a place where with this Walmart relationship, I've been really grateful to get just this running start. But you're uncoding so many pieces of starting a business and building a team while you're also solving a consumer problem when you're an entrepreneur. And so, we try to give females both those access to the kind of that infrastructure answers and kind of perspective, but also resources on data, analytics, product, engineering, how do you recruit, how do you hire, and what we kind of say is, “Each entrepreneur who enters is fairly early stage, but they still have different challenges and goals that they're addressing in this program.” So, we try to think, “How can we get each of them to that next stage in their career?” And I would tell you the biggest theme we see across female entrepreneurs is they're often not thinking or dreaming big enough. So, where I think we're able to add the most value and a goal that Jenn and I feel passionately about is pushing them to think. We have one company this summer that's bringing dental care and dental hygiene to offices. So, this trend of, “People are in their office more, working more. Flu shots come to your office, why can't dental hygiene come?”

RJ: Like a dentist comes to your office for the appointment?

JF: Yeah, yeah. Well for the whole office so you can book your slot, and they’re there in your office and it's during the work一

RJ: Every six months the dentist shows up?

JF: Exactly.

RJ: Interesting.

JF: And so we're like, “Well, does it just have to be dentists? Could it be doctors? What other services could it be that are coming to the workplace and making more efficient use of the employees’ time?”, because you didn't have to leave the office, etc. But also the employer gets that advantage of it's there, the employee didn't have to leave for two hours for the appointment. So, it’s just like stretching that to think about “Can it be bigger, can I think of other industries as well?”.

RJ: What's one thing you learned the hard way at Rent the Runway that you're now applying at Jetblack?

JF: Gosh, I mean I think learn the hard way at Rent the Runway being hands on with technology as much as possible. So I am not an engineer. I do not have a technology background. And one of the early mistakes Jen and I made was we found a firm to build our website at Rent the Runway and completely just like handed off the requirements documents. We worked really hard on all the details, and what we thought it needed to look like, and then we thought, “Okay, now they're going to go build it, and they're going to just hand us over a website in a couple of months.” And it doesn't work like that, right? And I think we learned that the hard way for sure at Rent the Runway.

RJ: When you got the website back it didn't look the way you wanted it?

JF: We didn’t get the website back. That was the problem. So it didn't come back, and then we waited another week or two, and I wound up flying to Canada where this theoretical team of seven engineers was working on the site. It was like one person coming in at noon and there was like hardly anything so I had to pull the plug. And we lost some some money in that early day and hired a different team who we were way more hands on and who built something in like a month and a half. That was our initial website for Rent the Runway. And you'll hear many stories like this. I don't think that's rare in entrepreneurship that that happens. And luckily, we were able to launch and it's all worked out great, but it was very stressful and intense. And so, as much as like I'm still not a wizard in engineering nor can I code and certainly AI and machine learning are new to me, I will ask the questions even if they're dumb questions. I will get the advisors by my side that I need to feel like I have a full perspective and informed decision. And I've used that kind of tactic of getting more advisors and mentors by my side throughout my career. And in fact, that's how I met Marc Lore. I was trying to learn how to lead logistics at Rent the Runway. I led our warehouse logistics and built are dry cleaning in vertically integrated for years and I was like, “Who's doing logistics really well?” and it was like Diapers.com and so, it was Marc Lore and Nate Faust and that's how I built that relationship. So, I take that kind of, “You know more than you think you know. Ask the dumb questions and get those kind of mentors and advisers in your camps that you can trust.”

RJ: But I think there's also another layer to that. I think a lot of us might feel like, “Well, why would I go to that guy and ask him for help when I can't do anything for him and I'm afraid that he'll see me as some nuisance in my life that we're not going to do business together per se?”

JF: Yeah and kind of what gave me the guts to go do it.

RJ: Yeah no I mean, but you had the guts. I think that's the key. I don't even一just knowing that that's what allowed you to figure it out.

JF: Yeah.

RJ: And your willingness to ask those questions.

JF: Yeah.

RJ: I think that's a really important lesson.

JF: I think so. And I think early on we almost had no choice. So when Jenn and I reached out to Diane von Furstenberg, we didn't have fashion background or experience so it was, “Well, what can we possibly do here?” And so if you do it once and you are—I say being naive is one of the best secrets of first time entrepreneurship. So we were naive enough to reach out to Diane von Furstenberg and to ask her advice and her time. You see it once when someone actually gives you their advice, they give you their time, they help you forward, you're like, “I'm going to do this again. This works.” And I think we have seen so many people be generous and excited to lend their advice and their experience to what we're doing. And that's part of what makes us now want to pay it forward and do that as well. We were helped along the way by so many people.

RJ: When you were thinking about leaving Rent the Runway, what kinds of opportunities were you thinking of at that time? Were you were you contemplating, “I'm going to go out and start something else totally from scratch,”?

JF: I actually thought that I would go work in venture capital and at some point in life I think I still may want to do that. And when Marc Lore called me with this opportunity, initially I was like, “Gosh, I really think I have my mind set on now doing venture capital.” And the reason I thought that was a good fit was I would be able to touch so many early stage companies and the serial entrepreneur in me who loved giving creative scrappy ideas and ways to get started and kind of problem solving and searching for solutions and meeting new young entrepreneurs. That was my jam. That was what I missed. And I saw that through the foundation that we started, how I was able to do that with all those entrepreneurs, and so, kind of take it to a place where that could be my day-to-day was really exciting. And so, what happened though, was that phone call from Marc was this gut feeling, “This is so unique. This is such a great opportunity.” Well, I didn't know if I could start another business on my own because I now know how hard it is. This was the chance to do it with half the work done for you. Like Walmart's infrastructure—

RJ: You have a nice little foundation there.

JF: Foundation. The fundraising itself can take up half of your time in the whole—in the life of the company, let alone the first year. But the 401k plans, the help, the comp and benefits, the real estate, the legal, like all these things that Walmart's able to kind of bolster me with made it very doable. Let alone the chance to kind of work with Marc on this game changing concept. So, I think you've got to follow your gut and I've seen that with marrying my husband, that was such a gut feeling in many ways. Starting Rent the Runway, one of our professors said to Jen and I, “Do that. It sounds fun.” And it sounds trivial, but it felt right in our gut. And I think some of the biggest decisions I've made, you kind of follow your gut. So, the operator bug wasn't fully out of me and I think venture at some point in life will happen. The other thing I'll say is I think we're so lucky; this moment in time you can have so many facets of your life and your career. So, I made an intentional choice. I took this job to say, “You know what? I'm still going to do investing on my own and advising and the foundation. I'm not going to pick a lane. I’m not going to choose.” And so, the traditional rationale behind this is that, “You can work and you can be a mom.” And so I do that. But I work and then I'm on the board of Rent of the Runway and I do invest and I do advise. And I think all those pieces make me a better leader in their totality.

RJ: Everybody who's listening right now is asking the same question: how are you doing all of these things? How are you managing all of it? What's your go to thing for time management and helping make your life possible?

JF: I kind of want more resources and tools. I wish I knew. I want to know yours. I feel like I'm constantly running around. I am an Efficiency Queen. I just—my whole life is driven by efficiency—

RJ: Lists?

JF: I love lists. I use a tool called Wunderlist for keeping to-do's that are synced on my phone and my desktop, but I also use physical lists. I live and work within five blocks of each other, also right near Rent the Runway office when I need to go there. I will take meetings while I'm running or walking. I will run to a doctor's appointment. So, I'm always trying to multitask and do a few things at once. My favorite thing is just thinking of hacks of ways to do things quicker and faster. Jenn, Rent the Runway Jenn, we were actually joking about this last night. I just loved thinking of these hacks and how do you do things more efficiently.

RJ: Do you have a list of hacks somewhere?

JF: I kind of more—probably, of things I do as hacks. But I can just more really quickly think about—give me something you’re looking to solve and I’ll think of a hack.

RJ: Well, here’s what I want to do. This is what I want to do. I'm going to send you a list of things that I want to solve. It will be a short list. And then I want you to write your hack and then I'm going to post it on Instagram in the stories.

JF: Oh my god, I love that.

RJ: So people can see your hacks.

JF: Let’s do it. Jenn and I were playing this game last night. She was feeding me things and I was like, “Here's my hack.” So she was asking, “How do I get up and actually make myself work out in the morning?” I responded, “OK. Find a Netflix series or show that you love. Don't let yourself watch it unless you're watching in the gym.” So little things like that.

RJ: That’s so perfect. I like that you run to appointments. That's very smart.

JF: Yeah, I think all my doctors think I'm crazy, but it's often as fast as the subway.

RJ: Your doctors are like, “You have an increased heart rate every time you come here. I'm not really sure what's going on.”

JF: Right. But it's the same time as time in transit. I'll take phone calls while I am in an Uber or whatnot too.

RJ: You're constantly getting advice. What's the worst advice you've received along the way?

JF: The worst advice. So, resume building I think comes up a lot. And I think just doing something for the sake of resume building is not advice that I typically endorse. And that relates hating my experience in finance and investment banking where you are doing it because you want that stamp of approval and the fancy name of the bank on your resume. But it's really grueling work and as much as you learn some foundational skills, I don't think you can let yourself do that for too long unless you're really enjoying it. And I don't think you can keep building your resume. I get year after year like it. There has to be some end so, can you cap it at a year or two years and now it's like, “Okay, now I am going to do stuff that I love everyday” because otherwise you're spending your time, you're spending your life. So, don't just do things for the sake of resume building is one bad piece of advice. And then I think一I don’t know, I focus on the good advice. I can think all the things when you're saying this that comes to mind. I focus on the positive and I think that's what you need to do to be an entrepreneur. Because you got to weed out the negative and just go forward on the positive.

RJ: Jenny thank you so much for joining us.

JF: Yeah, thank you for having me. This has been fun.

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