Inside Capsule Wardrobe's Climb to $1 Million

0:01Ready to soundtrack your summer? With Red Bull Summer All Day Play, you choose a playlist that fits your summer vibe the best. Are you a festival fanatic, a deep end DJ, a road dog, or a trail mixer? Just add a song to your chosen playlist and put your summer on track. Red Bull Summer All Day Play. Red Bull gives you wings. Visit redbull.com slash bright summer ahead to learn more. See you this summer. This episode of Female Founder World is presented by Omnisend. Hey, business besties. Welcome back to Female Founder World. I'm Jasmine. I'm the host of the show. And today I'm chatting with Ash Rasso.

0:37She's the founder and CEO of Capsule Wardrobe. Hi, Ash. Hi, Jasmine. Welcome, welcome. Thanks for having me. Okay, Capsule Wardrobe, what are you guys building? I am building a one-stop modular wardrobe solution. Essentially, we design and sell curated capsules, which our customers can purchase at a discount if they purchase the whole thing. But I think even more than that, we're building. I personally struggled to find items of clothing that were at my sort of quality expectation without needing to pay$3 ,000 for, say, a blazer. So I am trying to deliver the absolute best quality clothing for all the women around the world because everyone deserves to buy into a capsule wardrobe.

1:20Let's talk about a couple of milestones that you've hit because you started the business in 2023 is that right or you quit your job in 2023 yes so I quit my job at the end of 23 we launched the business last at the end of last March okay and you've done some like pretty significant revenue milestones since you launched yeah tell me so we we did six figures on our launch night we actually we pretty much hit it within the first four hours of launch which was crazy I was not expecting it at all I like I joke And I say I wanted to sell 10 pieces on the night, but we ended up selling through pretty much almost selling out.

1:56And we've just ticked over our first million, which you've heard it here first. It's incredible. Congratulations. And I think a lot of the people that we hear about kind of being able to hit that volume so quickly or selling out so quickly usually have a really low priced product. But you actually have a really quite like premium high ticket price. Yeah. Yeah, that's true. And actually, I haven't thought about that. That's exactly right. I feel like a lot of the businesses that I was sort of looking at for inspo did have a lower price point. And so I sort of said in my head that I wanted to hit that milestone quite quickly, but didn't think about the fact that, yeah, you're right.

2:30Our AOV is naturally higher. Our AOV at the moment is sitting at around 450 to 500, which is crazy. But in saying that, like, I definitely, I saw this, I was leaving a corporate job and it was like quite a formal corporate job. And so I knew that if I was going to leave to pursue something else, I wanted to throw absolutely everything at it. And so I by no means took the launch of the brand, like, not seriously. We're going to talk through your launch marketing plan. We're going to talk through like how you funded the business, all of the things. But I want, you sent me some behind the scenes photos before we went on the show.

3:04and I've got this one and I want you to tell me what this is. That was our first ever full capsule purchase on launch night. So I had spent a year and a half sort of building this business, building this brand with no actual true validation that what I was building was going to have product market fit. And so for me, that moment is so significant because it was finally, oh my gosh, I quit my job. I've thrown all of my life savings at this business and the market wants this product. So it was a real like, aha, I can breathe moment now. And then from there we went on to sell, I think it was around 22 capsules that night, which is crazy because like I was asking people to commit up to$2 ,000 on 12 items or 13 items of clothing from a brand that they had never heard of before.

3:51So it was, it was pretty cool. Because what I see when I see this image, I'm like, okay, the order value on all of these are over a thousand dollars. Yeah. Like this is not just getting orders for a$50 like lip balm, you know, it's crazy. Let's go back to when you quit your job and you're thinking, all right, I'm going all in. This is not a soft launch. This has to be, this has to work because I'm leaving something that's working to do it. Yeah. What was your plan from day one? Um, my plan from day one was always do not launch to an empty audience. That was my whole North star. Like make sure that by the time launch night comes, you have an audience in an industry that you've built credibility into.

4:30So I sort of took a two phase approach. Number one was building my own personal brand. And I took that so ridiculously seriously. So the second I quit my job, I started sharing, not only sharing brands of one day I wanted to align with. So I was really specific in the brands that I was sharing because I knew subconsciously if I could share higher end brands and subconsciously my customer would one day relate my brand to those brands. But coincidingly, I think where people miss the mark these days is I feel like people just come on and sell, sell, sell. But for me, I was like, okay, how do I actually build credibility in this space?

5:11Number one, let's share the problem that so many women actually struggle with, which was my problem. I've got a wardrobe full of clothes, but I don't know what to wear. I never have anything to wear. So I started sharing this problem and I shared it over maybe a five month period. And I built a community of women that genuinely resonated with what I had to say. And then I took them on this journey of, oh guys, I've come up with, I've stumbled across this concept of a capsule wardrobe. Let's go on this journey together to build one, like let's go on this journey to build one together. And so I then took them on this journey of like teaching them what a capsule wardrobe was.

5:47And it was honestly, it was true. I was uncovering what a capsule wardrobe was as much as I was sharing it. And then finally, I think it was a month before we launched, I played a guessing game with my audience, which was guess the name of the brand that I will one day, like that I'll be coming out with. And surprisingly, I think we got like over a thousand comments on the video, but 99 % of them guessed capsule wardrobe. And so it was a real like they it made them feel like oh my gosh we've been on this journey with her oh my gosh this makes so much sense and it made them trust me um which was really amazing but then parallel to that I was building the brand's socials out and the brand strategy so I had an Instagram page shout out to anyone that followed the capsule girl before capsule wardrobe was the page but it was essentially I built a capsule wardrobe with third-party brands and I would like steal their ghost imagery and flat lay outfits on use like using canva and every day I would share outfit inspiration from my capsule wardrobe um and I would also go on and create these like guides they were like 50 page guides which taught women what a capsule wardrobe was but also like pre-styled I think it was like over 50 looks it was something crazy and I would make people go in and download the guide in exchange for their email.

7:13So we built the Instagram page to around 7 ,000 pre-launch. So you had your own account and then you also had this like brand account, but it wasn't a fashion brand yet. It was more like a content. It was more like a style advice account. But you knew you were going to change that. Yeah, correct. Because for me, I feel like so many people do try to build an Instagram pre-launch. But the one thing that is so important when you decide to do that is you need to make sure that you're building an aligned audience. I didn't want to just put random viral videos on this page that had absolutely no relevance to a capsule wardrobe.

7:46I wanted the audience to be warm and to be familiar with the concept. So we built the Instagram to around 7 ,000 followers. We built the email list to around 7 ,500, I want to say. And on launch night, that email list actually generated$75 ,000, which is crazy and continues to be such a main revenue driver for the business. Were you engaging with those folks on email as the list was being built out after you'd sent out? It was like they'd get their one email and then they'd stay engaged with you on social? Yeah, they'd get their one email. I came up with multiple guides over the year. And so every time I'd come out with a new guide, we'd send everyone the new guide, irrespective of if they had signed up or not.

8:30But we weren't engaging actively. And while you were building this audience, no one, except for that month before you actually launched, no one knew that there was going to be a brand. So no, I did share a year before we launched that I was launching a fashion brand. And so I had this like, you talk about content pillars. I had really two main content pillars that I was, well, three content pillars that I was driving. One was capsule wardrobe and my journey of building a capsule wardrobe, not the brand. The second was I'm creating a fashion brand, come along with my days as I like try to work this out, but wasn't sharing anything specifically because we hadn't had the brand trademarked yet.

9:05And then the third was like fashion, beauty, lifestyle more generally as a niche, because I, again, I wanted to align with brands that I wanted capsule to one day stand aside. Did you literally sit down before you launched and map out, okay, these are my content pillars. This is what my content is going to look like and then execute on it. Or was it more of an in the moment? I'm going to try this. I see this brand doing this. I'm going to take something from there. Like what, how rigid was it versus how flexible? I think the pillar relating to capsule wardrobes in general was really strategic on my part because I knew I needed to get credibility in this space.

9:41I mean, I was a girl working as a property developer. How would anyone trust me to come out with a clothing brand if I had never spoken about, especially a clothing brand called Capsule Wardrobe? How would anybody trust my opinion if I wasn't talking about it? um the founder stuff the founder's stuff of me taking them on a journey of creating a fashion brand was probably a bit more organic because I didn't I couldn't really share much like I couldn't share designs I couldn't share the name because trademarking was so tight at that time so that was a bit more organic and the other stuff truthfully the other stuff it was actually I quit my job I had saved a set amount of money before I left my job.

10:20And then because I was so consistent on the content side, it actually started becoming a revenue driver for me. And so I took it really seriously because it meant that we needed to take less money out of our savings to be able to fund the business for launch. And so that pillar was really a way that I was protecting an income for myself during the pre-launch time. I want to talk about money and funding the business in a second, But first, just based on your marketing strategy and what worked and lessons on things, I'm sure there were things that you did that didn't work as well. What is the, for someone who's out there and they're launching something, whether it is a new product to an existing business or they are launching a business for the first time, what is the piece of advice that you have for that person?

11:00Build an email list. Honestly, I feel like so many people gave me that advice pre-launch and I was like, how great could this recommendation really be? And honestly, it blew my mind. The revenue that that email list continues to generate us, not even just on launch nights, but on business as usual days is crazy. So I would say, figure out what you're launching and then figure out a way to provide value around that industry that you're wanting to launch in and give things away for free. Not necessarily product, but in my instance, I was giving guides away for free in exchange for an email. Get really creative.

11:38Yeah. You know, back in the day, I had a beauty brand. way back really I didn't know that I had a custom beauty brand called The Buff we did customize beauty oils we were in open outfitters and anyway I launched that brand by creating guides about which oil works for your skin type and that was 2016 and it still works great minds thing and it still works honestly like I'm actually about to turn it on again as a strategy to further grow that email list like people love a guide and like it's great it shows that we're like a key opinion leader as well. Yeah. And also just like, tell me what to do.

12:12You know, like somebody, somebody just answer all of my questions and tell me what to do with my wardrobe. I agree. A hundred percent. Let's talk about funding the business now. Yeah. You said you're pulling money out of savings. You quit your full-time job to go all in on this. I don't think that's a, a lot of people are trying to figure out, okay, how do I, how do I balance growing a business and like living my life and being able to afford my life? How have you managed to pull this together and fund the business? Yes, that's a great question. And I don't think I've spoken about it a lot. So I had decided to start the brand probably three years before I quit my job.

12:45And so I had my eyes set on this horizon of one day, I was going to leave the industry and start something else. And I knew that it was going to take a large capital injection in order to deliver the brand that I really wanted to deliver to market. So I saved for about three years. As I said, content then became a revenue stream for me, which meant that I actually didn't have to dip into my savings as much as I thought I would need to. But in addition to that, like I've got the most supportive husband in the world who's also building a business, but it's meant that we've essentially needed to live off one salary, like groceries, bills, everything for three years.

13:24And it's come with a lot of sacrifice, but I guess I'm just lucky that I have a husband that really believes in the brand as well because he, yeah, times haven't been tough recently. Times haven't been easy recently. Yeah. I think that's really important to share because people come from this from all different backgrounds and all different circumstances. And I think that when you're in it, you can kind of look at someone else and think, if I could just do what they did or, you know, and it's like, you need to understand the sacrifice that people are making, but you also need to understand the advantages that they have that you might not have so that you can make the right decisions for yourself as well.

13:57For a lot of people quitting a job and going full-time isn't a decision that you can actually make for quite a long time. Like we have, I have someone on my team, incredible Paige, and she has a beverage company called Benny. They're in Target. She still works for us. Yeah, of course. Now she's in a contributor role and that's to have that income so that she can build the business as well. And that's been multiple years now. And I think that's also a really common story. And that's where I can't like people say to me, like, why don't you step away from content creation? Because it's a main revenue driver for me personally right now and I need it.

14:27So you're doing like brand deals and stuff on your account now? Yeah, where I can. I mean, it has to be aligned. I've obviously pivoted my entire personal brand to solely Big Capsule right now. And so I'm very selective in what I'll do now. But it's something that I rely on. Yeah. One thing I love about your story is just the audacity. Like coming from property development and saying, I'm going to build a fashion brand. And how many fashion brands are there? Like a million. but you're like, no, I'm going to build the best fashion brand and solve this very specific problem. And just that inner confidence to know that it was going to work out and be able to back yourself and it is working out.

15:04Where does that come from? Is that just you mate? No, because like, I don't know. So many people and myself included will just sit there and they'll overthink the next step and they'll overthink whether they should do it and they'll hedge their bets. But you just went all in. I just, yeah, I think it comes from the fact, I think it comes from a place of just being really clear in like the problem that you're trying to solve. For me, I, you're right. There are so many fashion brands out there. And so I knew that if I was going to come out with a fashion brand, I needed to make sure that it was like so ridiculously niche and there was a warm audience there, which is why I place so much prominence on our pre-launch.

15:45Like I don't believe the brand would be where the brand is today if I did not put as much work as I did in the year and a half leading into the formal launch. But also like, I feel like it's so taboo for women to like back themselves. And like, it almost can come across as like, we're up, we're up ourselves. But what is so wrong with saying, Hey, I'm going to do the thing and it's going to work out because like, there's only a plan A, like there isn't a plan B for me. And I think it's just like having that confidence and don't get me wrong there are days that I wake up and I literally will say to my husband what am I doing this is so dumb I can't do this I'm not the person to do this and I think it's just coming back to like I go through my tagged message I go through my tagged photos I go through my dms and it's like it's a brand that's really helping women and changing women's lives so I show up for them as well I have a folder on my phone called nice feedback me too I just started it last night that's so crazy if you are watching this and you're having a bad day go create your folder and it is just like little comments little dms feedback from partners yeah like screenshots of stories and when i'm having a really shit day and i'm like i'm not the person to do this or you know all of the things so go through your head and then i just open up my little folder and i think no no no people like this you're right doing it um you absolutely need to keep doing it it's because i was listening to female founder This is actually a really full circle moment for me because I was listening to Female Founder probably a year before I quit my job at Phrases.

17:13I feel like it was this specific podcast that gave me all of the marketing tips and insights to give me the confidence to go and quit. Oh, Ash. So you're doing amazing. I love that. And also massively full circle moment because I am now working from your office. You are. I've had a death. Actually, on that, I've got a present to give you today. Because I'm starting on Monday in your space. You're starting on Monday in the capsule wardrobe space. Oh my God, I don't know where the key is now. You've got a key. I've got a key, but I don't know where I put it. I was hiding it from you, but I don't know where I put it.

17:42Don't lose my key. Ah, welcome to the family. This is so good. Oh my goodness. Okay. As someone who has been working from home and remotely and is just so sick of it, this is like milestone moment for me as well. You're part of the family now. Oh my goodness. Okay. So everyone, if you're following Female Founder World on TikTok or following me on TikTok, you're about to see a lot of content in the most beautiful office in Sydney because your space is so good. And you're about to see a lot of the dog, Howie. Yes. We love Howie. How big is Howie now? Howie's six months. Okay. He's so cute. He is so cute.

18:14All right. Let's talk a little bit more about marketing and what you're doing now. So obviously you've launched, you've built this, you've built this amazing audience to launch to. You have this really clever email strategy. What are you doing now to continue to grow that traction? Yeah. Something that honestly, I completely underestimated it, but it pretty much doubled the business overnight. Like our daily sales have doubled overnight since that moment was an in real life pop-up. So obviously like we're still very much startup. We don't have massive budgets to put towards solo spaces. So I ended up reaching out to one of my friends, shout out Ed Hanson, Esmer Fragrance.

18:53It was a brand that I personally felt very aligned to. And he had a store in Bondi. So I pitched an idea of a pop-up in his store, which didn't end up costing me anything, which was amazing. And I think we got like over 300 people through the doors across two days and so many new discoveries of the brand, which was amazing. So we did that in November. We did a second one in February. That was more of a community focused event. So it wasn't necessarily focused on moving Rev, but more building those relationships out um and we're about to do our third one um this month I think it's on the 20th of June and it's just like getting people in the brand in real life getting to experience the product because I will die on the hill of product is really our north star at capsule wardrobe and it's such a beautiful product and there's like you can only have me talking about it online so many times before people actually just have to come and experience the brand for for themselves so that's really working for us we are also we don't pay influencers and I mean never say never but I really want to avoid paying influencers because my whole thing is like I want people to wear the brand because they actually genuinely love the brand but we do gift from time to time and I've actually found that we don't gift an awful lot like I'm really selective in sort of alignment with capsule but there is certain creators that I formed such an amazing relationship with and that they genuinely love like that's a really hot tip like if you find someone that is genuinely so aligned to your brand and the product that you're coming out with really foster that relationship Gemma Diamond has been so amazing for us like she is somebody that just loves the product and so I'm always asking her for feedback I'm always asking her how we can improve And it's just amazing to have like amazing creators in your corner.

20:51I think the really smart thing that you've done there with the pop-up is the partnership piece. And I think a lot of people sleep on this. Like you don't actually need to necessarily pay for a space. If you can tell a bricks and mortar store, I am going to bring exactly your target customer into your space for free and create something really cool that we can like create content around. So many folks will say yes, if you find the right aligned partner. A hundred percent. I believe it to my core. We've actually since had brands with bricks and mortar stores reach out to us in like prime retail locations saying we'll give you the space on like a weekend, which would ordinarily cost.

21:29There was like an instance in Melbourne where a space was going to cost us like$20 ,000 for two days. And the space next door, they pitched to us and they were like, we'd love to have you come in and use the space. And it was like, wow. Yeah. So never be scared to ask. And also you now have a case study that you can then take to whoever you want. Totally. Totally. It's been a game changer. Everyone hears me harp on on the podcast about the analog resurgence. I just think that everything like offline, everything. I think people are so sick of their feeds and any way that you can like get out into the world.

21:58It also makes you look a lot more legit. Yeah. And that's the thing. I think that Bondi legitimized the brand for us because there was actually physically products that people could come and feel. And there was a community behind it. But like the relationships that were formed on that day, people message me all the time saying they're still friends with those people, which is amazing for me. Love that. Okay, let's talk about production. What did you launch with? How did you do it? How did you find your people? Oh, God. How much time do we have? How did you find the wrong people? Obviously, I don't have a fashioning background.

22:32We launched with 12 SKUs, which I was chatting around. I obviously did not have an established network in fashion and it really came down to me finding one person, asking that one person for contacts and then like the tree sort of branched out from there. And through that, I've built the entire supply chain. But yeah, we launched with 12 SKUs, which everybody said do not do. Like it's suicide for a new brand. But I was also like, I need to back the concept. Like it's a brand called Capsule Wardrobe. I need to come out with a capsule wardrobe. And for me, no matter which way I looked at it, it needed to be a minimum of 12 SKUs to deliver a functional wardrobe that I knew that my customers could style back a million ways.

23:14So when you buy a capsule at Capsule, you'll receive 30 % off, but you'll also receive access to a section of our website that will show you over 300 ways to style the capsule. So we launched with 12 SKUs. I mean, so much has gone wrong. Was that the right decision or the wrong decision? Absolutely the right decision. Again, it legitimized the brand. It allowed at the time, so we actually had a really big incident happen a month after we launched the brand. The 12 SKUs pretty much almost sold out on launch night. And so I launched a pre-order a month later. At the time, we only had one supplier and we were producing maybe 20 % onshore.

23:59So our dresses were produced onshore. They still are. but at the same time the U.S. tariffs were sort of starting to circulate. I launched the pre-order on sale Wednesday night I can't remember specifically and then on the Thursday I went to place the PO with the factory. We had been in discussions prior to me launching the pre-order they were like yeah we're good to go this is the lead time. Launched the PO and I got a call on the Friday to say unfortunately with the circumstances we can't fulfill the PO. Essentially what had happened was all of their US brands had left them, which meant that they had capacity to take on a massive conglomerate, which sort of wiped out all the small guys.

24:38So I was sitting on a whole bunch of orders and money. We had taken the money and we couldn't fulfill them. We didn't have the product. And so we entered into a really lengthy negotiation with the factory. Thankfully, they agreed to do the reorder for us, but at a much increased minimum, and there actually wasn't enough money in the business to cover the order. So at the time, you can imagine I was distraught. But in hindsight, I mean, I'm so glad that everything happened the way that it did because we continue to sell. We've now sold out of that stock. And again, it allowed the brand to go. It sort of forced me to level up before I was ready.

25:13But yeah, production is stay in the game, network as much as you can, speak to as many people as you can. And also somebody said this to me the day that I quit. They said, never, ever underestimate a stranger's willingness to want to help you if you believe in what you're doing enough. And since that moment, I have had so many strangers come into my life and literally just be like, we just want to help you because we can see how much you want this. I love that advice. What's your advice for someone who is going through a tough negotiation period like that? I think my advice is, it's something my husband talks about a lot it's a Chinese farmer story which is he can explain it way better than I can but the crux of it is you never know whether something is good or bad in that moment you just need to do what feels best for you at the time and so when you're going through a tough negotiation I mean I at the at the time it felt like the worst thing ever it felt like I was losing the business a month into starting the business but then in hindsight it ended up being the best thing that ever happen to us.

26:19So I think in any difficult negotiation, try, I know how hard it is, but try to separate yourself from the emotion and have the goal front of mind and just know that like, it may feel really bad, but it could end up being like the best thing that ever happened to you. Like that ever happens to you. So you've just hit a million in revenue. Who is building this with you? So we have just hired our first part-time product lead. This is wild. So you've been doing this by yourself yeah I haven't slept at all I'd be like laughing I'm like edit the bags out of my eyes please um we yeah we just hired our first part-time product lead and she has been game changer I think I sort of had to look at the business and I was running myself to the ground but not only running myself to the ground also we were so late on collections and like we you to scale a fashion brand or any a fashion brand like you're competing against people that are releasing weekly.

27:18And so we last year released twice a year and I felt like it just required such a huge marketing effort for us to be relevant by the time that second drop came because we were almost not forgotten about, but we didn't have anything new to talk about. So bringing her on has been a game changer. She's sort of leading product now. I sit as creative director and then I freelanced to an amazing fashion designer. Again, I set the creative vision and she sort of comes back she returned briefs me designs and we go through together to sort of land on the final capsules um what are the freelancers are using buying buying is such a big thing that I didn't think about when I first launched but that like actually has a massive hit on rev if you don't get it right so we've bought on a freelance buyer how does that how do you integrate a freelance buyer into your team like what does that what do they do um so buying is essentially number one buying future collections so like sort of figuring out what you're open to buy is and figuring out how much money we're going to place or how we're going to back each skew but then also size curves so that has been like probably the biggest learning curve that's probably where we've left the most money on the table as a business over the past year just not buying correctly not buying the correct sizes so not knowing what size people are going to buy and which skew is going to like take off.

28:40We've had so many instances on launch night where like we've completely sold out of, I don't know, a size 6, 8 and 10. And we've got heaps of stock on a 12, 14, 16 on a style that probably wouldn't move in that size frame. So having her on board has been a game changer, but also like virality. Like people talk about virality as being the best thing ever. And while it was the most, it is the most amazing thing when it's happening in the moment, I feel like a viral moment is only ever good if you have the ability to capitalize off that viral moment. So for us, we had a massive viral moment a month into the brand launch and we sold out like overnight and then we weren't able, we're still chasing our tail with that.