Dive Brief:
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Stitch Fix has acquired the technology and IP of wardrobe tech company Finery, Stitch Fix on Tuesday confirmed to Retail Dive in an email. The news was first reported last week by Women's Wear Daily and Yahoo Finance, citing an email from Finery to its customers.
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"Please note that we did not acquire the company," a Stitch Fix spokesperson told Retail Dive. Finery didn't immediately return Retail Dive's request for comment. The amount of the transaction is undisclosed.
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After some stumbles in its early months as a public company, Stitch Fix blew past analyst expectations for sales and profit in its most recent quarter, reporting that net revenue rose 29% to $316.7 million, net income reached $9.48 million (after a $9.56 million loss a year ago), and its client base grew 30% to 2.7 million active customers.
Dive Insight:
Stitch Fix is often thought of as an apparel subscription service, but the company assiduously maintains that its operations are centered on styling services. And that's also where Finery's tech fits in.
"At Stitch Fix, we help millions of people solve the challenge of finding clothes they love, that fit and inspire them to feel like their best selves," said the company spokesperson. "This approach closely aligns with the mission of Finery's digital wardrobe platform, which saved users time getting dressed and was a source of style inspiration. As a company, we're constantly thinking of new ways to better serve our clients and learn more about their style needs."
It's unclear where Stitch Fix will take Finery's tech, but the startup's customers won't reap its benefits for much longer until it does, according to WWD. Finery customers have until this Friday to download their saved wardrobe information or lose it, and Stitch Fix is making it up to them by waiving its monthly styling fee for a month if they want to sign up with Stitch Fix, according to the report.
No customer information is included in the deal. But Stitch Fix is already a data-forward company, and Finery's tech could further those goals. The company is facing mounting pressure in apparel e-commerce and subscription. Amazon has added styling services to its own Stitch Fix-like Prime Wardrobe service, and several specialty apparel retailers, including Ann Taylor, American Eagle and Express, have launched monthly services of their own.
"Some of our most successful product initiatives have emerged from experimentation with data science," the Stitch Fix spokesperson said. "We're excited about the potential of what we can learn through the technology that [founders] Brooklyn [Decker], Whitney [Casey] and the Finery team have built."
