“In the Studio,” thredUP’s James Reinhart Reflects on his Company’s Evolution

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Editor’s Note: Semil Shah is currently an EIR with Javelin Venture Partners and has been a columnist at TechCrunch since January 2011. He hosts a weekly TCTV show In the Studio and will now begin a weekly Sunday column, Iterations. Follow him on Twitter @semil.

“In the Studio” opens its doors this week to an entrepreneur who once founded a nonprofit charter management organization for schools in California, spent a summer in management consulting, and eventually stumbled upon a case study experiment in school that gave rise to founding his current startup.

James Reinhart and I met a few years ago in school, and I remember him talking about his new business, inspired by an operations case on Netflix. Over the next few years, Reinhart and his co-founders founded a small company in Boston, raised angel funding, packed their bags for San Francisco, and went through a number of fascinating shifts in their business model and vertical focus before eventually stumbling into something potentially big. And, for a nice touch of symmetry, the company just announced the appointment of two former Netflix executives to the company’s roster, one to lead operations and the other to the board.

Reinhart is the CEO of thredUP, a site where parents can sell their kids’ used clothes using their dead-simple process and/or where parents can buy certified, pre-owned clothes directly from the company. thredUP went through a few fascinating iterations, initially starting out as a service to allow peer-to-peer swapping of clothes, but then they found the most activity was around children’s clothing; then after focusing on the kids’ clothing market, they realized they’d need massive scale in order to capture enough value from those P2P transactions. And, as a result, Reinhart and his team may have stumbled into a big idea as a result of their constant hunt for a larger problem and bigger market, specifically to help working-class families buy and sell assets that are frequently needed and normally expensive to acquire.

In this discussion, Reinhart dissects the thredUP’s trajectory and how he made the key decisions that has taken the company to where it is today, as well as other areas they could expand once the model is proven to have a chance to scale. He is remarkably honest in the video, reflecting on the choices he and his team made and learned from. This would be useful video for any founder focused on marketplaces and online-offline operations and logistics.