Rent the Runway cofounder Jenny Fleiss joins growth equity firm Volition Capital

After launching unicorn clothing-rental startup Rent the Runway out of Harvard Business School with cofounder Jennifer Hyman and launching personal shopping service Jetblack out of Walmart’s retail incubator and investment arm, Jenny Fleiss is entering a new chapter. Starting tomorrow, she will be joining Boston-based growth equity firm Volition Capital as a venture partner.

We caught up with her to talk retail trends, what she looks for in a founder, and leveling the venture capital playing field for women and minorities.

The interview has been edited and condensed.

Fast Company: You founded Rent the Runway in 2009 with current CEO Jennifer Hyman. How did you divide the work?

Jenny Fleiss: During the first few years, Jenn and I really divided and conquered. [We] each wore multiple hats. For the first three to four years, she did a lot of the external work, like [forging] designer relationships, consumer-facing sales, and marketing. I did a lot of the back-of-house work like handling logistics, technology, investor relations, and getting an HR and legal system set up. Jenn is [good at] big strategic visionary thinking about where’s the puck going five years from now. And I’m like: Let’s break this down. What are we doing this week? Our skill sets fell into those kinds of patterns. Now it’s something that I look for when I invest in founding teams.

FC: You left Rent the Runway for Walmart in 2017, where you eventually ran experimental personal shopping service Jetblack. When did you decide it was the right time to leave?

JF: I was still itching for that early-stage entrepreneurial energy that I felt in the early days of Rent the Runway. I felt it when I was trying to learn about dry cleaning and setting up our warehouse. I felt it when I was testing subscriptions. Jenn knew this about me. Leaving was easier because we’ve always been so direct and we had some honest discussions about it.

FC: You mention missing a scrappy environment, but Walmart is a big, well-established company. What attracted you to the role?

JF: Going to a Fortune One retailer and leveraging my entrepreneurial skill set at a moment when Walmart was making digital commerce a priority and putting major assets and resources toward it was a big draw. They were leaning in and had just bought Jet for 3.3 billion. As an entrepreneur, you really want to have impact, so the ability to have impact at such a big scale was really exciting. And financing was taken care of, as well as the legal, HR, and financial systems. You could skip over a lot and just get to the meat of the project.

FC: What were some of the challenges you faced at Walmart?

JF: I had to get buy-in from the multiple stakeholders. That really still does matter in a big company. If you’re asking for a big budget and trying to leverage things like the supply chain of Walmart because it’s a great asset, you need to build those relationships. I think the average tenure at Walmart is like 10 or 15 years, so a lot of them didn’t [start] in this moment when digital is a priority. And most digital businesses are less profitable.

Building that respect, meeting them, and learning other parts of the business was really important. And then recruiting the best talent: You can’t set up equity in the same way you might at a startup. [But] there is a whole pool of talent you can get that can’t necessarily afford the risk of a startup that may tank, but is entrepreneurial. So we were trying to strike that sweet spot saying, “You get to do entrepreneurial things but with a much bigger safety net, but there is not compensation on the equity side.”

FC: You left Walmart in 2020, and now you’re joining growth equity firm Volition Capital. When did you know it was time to make the jump?

JF: I went there to be an entrepreneur, and part of the success metric was if the business gets absorbed into the broader company. So [Walmart] used the technology platform that we built to enable conversational commerce, starting with texts.

FC: COVID-19 has changed the way we shop. What trends have you seen in the retail space this past year?

JF: The main theme that I saw is that businesses that had an omni-channel strategy were the businesses that were best prepared. [An omni-channel retail strategy] gives you the immediate ability to leverage the physical store as a warehouse if you need to, or to buy online and pick up in store. Anyone who didn’t have a digital bone in their business had to change.

Another thing that’s been pretty interesting is thinking about how shopping for discretionary items has evolved. Shopping is a social activity. You’ve started to see things like video commerce—trends that were explosive in Asia—now are really taking off here. There’s also a lot of entrepreneurial spirit. So many people started side hustles because of COVID-19-related needs. You have Instagram influencers promoting new products. It’s almost back to the Avon model of years ago, with people treating [product promotion] like a job and making a living off of it.

FC: Have any companies impressed you with the way they’ve handled the pandemic?

JF: Peloton’s ability to scale in this moment at that pace as a relatively young company is fantastic. It’s a well-oiled machine. I’m also impressed with businesses that it’s been tough for. This has been a hard moment for a business like Rent the Runway, where you could never have predicted that there would be a point when people didn’t need to dress up. Seeing leadership that is able to navigate a pivot, or add parts to their business and rally a team and keep their spirits high and adjust quickly is a really good example to me.

FC: What attracted you to Volition Capital?

JF: One is the size of the firm itself and that [it’s] like less than 30 people—it’s still lean. And then the people to me are the most important: It’s how I’ve made every career decision. As much as I was trying to make a must-have/nice-to-have career-decision matrix, the people were like numbers one, two, and three.

Then I was excited that it’s a growth equity firm. At this moment, where valuations in particular are very high, it’s refreshing to find a firm that is focused on marrying high growth, big market opportunities with the fundamentals of investing. I have an operating background. There is no one at Volition who had an operating background, so that’s something I could add.

FC: What are the main factors you take into consideration when you decide whether to invest in a business?

JF: To me, it is all about the team. Often there is nothing other than the person or people and a deck. My preference is to still vote for the people and the team. You will never be able to construct the kind of passion and financial incentive that you had for that initial founder again. I also like investing in cofounders. I mentioned that Jenn and I married big-picture thinking with operations thinking. It is very rare to find both of those things in one person because, to me, they are personality traits that often are just pretty different. But there are individual founders who can manage both.

FC: You’re one of 5% of women investors. And there are other dismaying statistics: Black women have access to just less than 1% of all venture capital. How do you think the landscape can be improved?

JF: When I was at Rent the Runway, sometimes we were pitching a room full of 50- or 60-year-old white men and it was tough getting them to relate to our business, which was oriented toward women in their 20s and 30s. But women influence more than 80% of purchase decisions. So as an investor if you aren’t relating to that end consumer, I don’t think you can necessarily have the best portfolio or see all the opportunities or ask all the right questions.

Change like this doesn’t happen overnight. The more you have women on boards and in investing roles, the more you have firms that are open-minded to different backgrounds. Then that gradually breeds into more women getting excited about working in venture or starting businesses and then going and working in venture the way I did.