WHAT THE START-UPS THAT AVOIDED THE DTC CRASH HAVE IN COMMON.

1. What the Start-Ups
That Avoided the
DTC Crash Have
in Common
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2. When Allbirds announced
that it was cutting its staff by
8%, it did so to “set up the
next phase of growth.”
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3. RealReal Founder and Chief
Executive Officer Julie Wainwright
said that she was resigning at “the
right time for the next generation of
leadership…"
03

4. These companies have similar stories. Their
IPOs, from The RealReal in 2019 to Warby
Parker in September 2021, have thrived by
attracting new customers with innovative
business models, smart branding and lots of
digital advertising.
04

5. Although their executives have laid out
the case — new stores, automation,
sluggish incumbents, rosy customer
lifetime value projections but they've not
been consistently profitable.
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6. And as a result, the rising interest rates
and fears of a recession mean they can’t
count on investors and lenders to cover
their losses.
06

7. So they are trying to convince investors
they can operate as mainstream brands,
which means they'd be cutting back on
growth to increase profit margins.
07

8. But olaplex seems to be towing a different
route. The prestige hair care brand went
public the day after Warby Parker last
September, and built the business the old
fashioned way. They found good use of
salons and recommendations from famous
hairdressers.
08

9. But even when Olaplex avoided the
startup crash of the year, and its stock
price dropped by 30%, It has remained
profitable, and has doubled its market
capitalization.
09

10. Brands should make sales,
but more important is where
those sales happen and how
much it costs to make them.
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