After success at Moda Operandi, Aslaug Magnúsdóttir’s next venture, Tinker Tailor, bombed. Here’s why.
A lack of clarity, a bad fundraising strategy, and a poorly-selected advisory board can set up any entrepreneur for failure. Even a seasoned one.
It’s fashionable for entrepreneurs to celebrate failure as a face saving act. Once Rome burns down and the embers turn to ash, founders reflect back in a romantic sort of way, and wax on about “lessons learned.” Few are willing to reveal their true struggles in the heat of the moment, however, and in the aftermath, only paint in broad strokes. Given the popular protocol, then, it’s refreshing to come across a founder who is candid, detailed, and forthright.
Recently at Fast Company, Aslaug Magnúsdóttir, former CEO of Tinker Tailor — a service that let women design their own dresses online and tailor designer dresses fresh off the runway — discussed the company’s folding in the summer of 2015 after debuting in the spring of 2014.
An ambitious project that blended e-commerce and high-end personalization, Tinker Tailor was an outstanding concept we at Lean Luxe were pulling for with some enthusiasm. But as Fast Company’s Sarah Lawson explained, it appears it just wasn’t Tinker Tailor’s time. “I think maybe we were a little bit early with the concept,” Ms. Magnúsdóttir told Ms. Lawson. “There are pros and cons to being a first mover. We were the first multibrand platform for the customization of designer clothing. And it’s great to be a first mover if you manage to pull it off.…But if you’re quite early, you’re learning a lot: both learning as a company, and the customer is still learning.”
So what specifically went wrong? We noticed that Tinker Tailor was crippled by several operational issues. From the start, Ms. Magnúsdóttir (who also co-founded Moda Operandi) chose to launch with two distinct services. The first was an alteration service in partnership with over 100 fashion brands; the second was a made-to-order arm carried out by the Tinker Tailor team itself, rather than being outsourced. Separately, each service on its own was time intensive enough — not to mention operationally and logistically difficult. But together, they became an operational nightmare for a startup in its infancy. Combined with the absence of a truly streamlined process, this was a case of too much too soon, as both Ms. Lawson and Ms. Magnúsdóttir confirm:
“They teach this at business school: Start with just the minimum viable product and test it before you go and build out too much,” says Magnúsdóttir, who graduated from Harvard Business School. “I’ve always been a little bit torn about that, because when you’re dealing with luxury fashion, launching with a product that is very basic and doesn’t have the romance and excitement—is that really going to show you the results that can be achieved?”
That’s a fair point, wrote Ms. Lawson. But, she added, “Magnúsdóttir struggled to choose between two directions, saying that she considered both services [essential]. Still, she might have launched one at first and then endeavored to launch the other once she hit mile markers of success.”
Tinker Tailor’s advisory board certainly didn’t help its cause either. Stuffed with ‘brand name’ fashion insiders — Leandra Medine from Man Repeller; Melanie Ward, a stylist; Laura Brown, an editor from Harper’s Bazaar; and Yasmin Sewell, a creative consultant — each had the ‘right’ fashion pedigree, but crucially, not the e-commerce or operational expertise to right the ship when things started to go wrong (which negates the purpose of an advisory board).
There was also the matter of fundraising. Raising money is not an exact science, and young companies can hinder themselves by raising too little. Arguably even worse (especially from an emotional standpoint), they can choose the wrong backers who lack the patience and industry expertise to help founders bring their companies along (and then later inject more capital in subsequent rounds). Ms. Magnúsdóttir suggested that she may have raised money too soon, or didn’t raise enough, perhaps even both. And unlike at Moda Operandi, whose higher seed round allowed the company to secure a set of investors who were supportive and willing to invest larger sums afterwards, Tinker Tailor raised a smaller seed round and later ran into trouble generating VC interest for an additional round at a higher valuation.
Mark Jennings, founder of Shaken Cocktails (itself a failed startup), might have said it best in a recent episode of Monocle 24’s The Entrepreneurs: “Failing slow is a vanity play.” With Ms. Magnúsdóttir’s Tinker Tailor, it’s certainly better that it folded quickly, rather than bleed out slowly. But we can’t help but feel that had the company focused on one core service and expanded from there, we would perhaps be writing a different story today.