James Reinhart | Crain's Philadelphia

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

James Reinhart


Based in San Francisco, thredUP is an online consignment store where users can buy or sell previously worn clothing. 

The Mistake:

At the very beginning, I was just passionate about solving the problem of overflowing closets and having nothing to wear. The core insight to the business was when I was getting dressed one morning and I opened my closet and saw it full of clothes. People all over America have closets full of clothes they don’t wear.  It was about solving that problem.  

We originally thought of solving the problem by swapping men’s shirts, which I always describe to people as a terrible business, but a good story. We started with men’s shirts,  swapping them like Netflix. Then we focused on kid’s clothes. Our original tagline was: "Clothes don’t grow, kids do." So we switched the market opportunity.   

From there, we learned it wasn’t about swapping or peer-to-peer. 

There’s a lot of friction to selling your own things. What we found with men’s shirts, swapping kid’s clothes, and living in the peer-to-peer world was that customers don’t want to do that—which is why everyone sells on eBay for awhile, and when that doesn’t work, they don’t do it again. It’s a lot of work. 

When we talked to customers, what we kept hearing was: “It’s a cool idea, but I don’t want to deal with it in the way you’re presenting it to me.”

We kept hearing, "I don’t have time for this."

When people say they don’t have time for this, it means there’s too much friction in the experience. It’s not good enough to make them stop what they’re doing and hear a solution. Not having time is just a proxy for not being good enough.   

We moved away from peer-to-peer, taking on additional parts of the value chain (logistics, photography, customer service) to deliver a more convenient customer experience, enabling more people to participate in the service ... All that our sellers have to do is put their clean-out items in a bag, drop it in the mail and we do the rest of the work.

You really have to love the problem you’re solving, not your solution.

The Lesson: 

The lesson for us that I learned over time is: You really have to love the problem you’re solving, not your solution. Early on, it’s easy for CEOs and young founders to fall in love with your own ideas and drink your own Kool-Aid. 

But every time we make decisions about loving the problem and trying to deliver an amazing solution for customers, we continue to improve the business. Ultimately we needed to manage the inventory and the consumer experience more tightly. So we moved to the model we use today, which is selling directly to consumers. 

Every time we talk about new features or new opportunities, we come back to: Are we being relentless about solving our customer’s problem rather than just thinking of new stuff to build?

Follow James Reinhart on Twitter at @jamesreinhart.

Pictured: James Reinhart. | Photo courtesy of thredUP.