The RealReal has raised $14 million to grow its luxury online resale marketplace, which it claims is “second only to eBay.” The startup’s team of professional stylists and fashion experts hand-select and authenticate pre-owned designer goods from brands like Chanel, Dior, Gucci, Hermes, Louis Vuitton, and Cartier. The goods are sold in 72 hour flash sales for prices at up to 90% off the original cost.

For style mavens who can’t afford to shell out thousands of dollars for a Dior dress or Gucci blazer, The RealReal makes high fashion more accessible. Women also have the opportunity to sell their own stockpile of luxury items, to then (of course) buy different ones.

“We’re changing the way people view their designer wardrobe and luxury items,” said The RealReal founder and CEO Julie Wainwright. “We offer consignors a way to get a return on what they originally paid for their designer items, effortlessly and lucratively.”

When trying to build a marketplace for luxury goods, trustworthiness is key. No one want to pay $400 for a Hermès scarf. The RealReal tackles the uncertainty of buying luxury goods online with its team of “tastemakers” who are responsible for hunting items that “embody timeless luxury” and carefully examining each for authenticity. The stylists also work directly with people who want to resell their designer clothing, shoes, handbags, accessories, and jewelry to assess whether their goods are eligible for sale. Shipping is free and consignors receive between 60 and 70 percent of all sales.

In two years, The RealReal has grown its member base to 750,000 and attracted 1.5 million unique visits in January alone. The startup ships over 15,000 luxury items a month and claims to have a 75 percent sell-through rate for its flash sales. Its revenue has grown tenfold in the past year. The company will use this second round of funding to expand its infrastructure to support this impressive growth.

InterWest Partners led this round, with participation from existing investors Canaan Partners, e.ventures, and Greycroft Partners. Novel TMT Ventures, Panarea Capital, author Suzy Welch, and Sukhinder Singh Cassidy also made strategic investments.

Photo credit: Wikimedia Commons 

The product is called Sunrise. It is a “smart” and “beautiful” email digest of your day. Founders Jeremy Le Van and Pierre Valade were high up designers at Foursquare. Disappointed by the available calendar options, they decided to create an alternative that puts user experience at the forefront. 

The platform connects APIs from anywhere people might have a calendar, including Facebook, Google Calendar, LinkedIn, and Eventbrite. It merges all of the information in an attractive email that arrives in your inbox every morning. It is optimized for mobile, since around 50% of users open the digest from their smartphones, and it includes integration with LinkedIn that pulls in profiles of people you’re scheduled to meet.

Sunrise also offers relevant information about the weather, birthdays, and addresses, so everything you need to go about your day is consolidated in one place.

“Calendars is one space that hasn’t really evolved in the past years, and it’s time to connect all the information together in a smart way,” said Valade. “When users wake up, it’s already their routine to check their emails, so we are in the natural flow they’re used to. It is both simple and powerful. We designed at least 25 different variations before finding the right one that will work both on mobile and desktop. I think we’ve designed the best email ever.”

Valade and Le Van left Foursquare earlier this year for this project and are still in the early stages. The team is just two people, and they have not yet set out to fundraise. Of their early adopters, 50% open their Sunrise every day, which Valade said is high compared to traditional emails. This design-focused duo is committed to constant iteration, to make Sunrise as user-friendly as possible, and to “solve calendars.”

Sunrise is based in New York.

This is a guest post by investor Jenn Wei

The line between fashion and technology is blurring.

From the flock of tech founders snatching front row seats among the fashion elite at New York Fashion Week, to style icon Diane Von Furstenberg wearing Google Glass to produce a first-person intimate look at her life behind the runway, it is clear that technology is unapologetically setting new fashion trends and not looking back.

One of the most prominent ways technology has transformed fashion is through e-commerce. E-commerce penetration as a percentage of total retail spending in the US has more than tripled in the last decade (in Q2 alone it was up 15 percent versus a year go.) But upon closer examination, it’s in a very lopsided way.

Although approximately 10 percent of apparel and accessories are now purchased digitally, e-commerce has barely made a dent in the luxury goods segment, one of the fastest growing and anti-cyclical offline retail categories that is clearly ripe for disruption.

During business school, I was lucky enough to visit Paris and had the chance to meet with several of the enigmatic and larger than life personalities that lead the world’s most celebrated luxury brands, including Hermes, Yves Saint Laurent and Van Cleef & Arpels, to see first-hand how these companies define luxury and create a culture around tradition, craftsmanship, and exclusivity.

After all, luxury good is fundamentally an illogical product — why would any sane consumer pay 1000 percent above cost to acquire a monogrammed handbag or scarf?

However, luxury goods companies are selling much more than a product — they are selling a mentality, an attitude and a lifestyle choice. It’s the exquisite details on the Chinese panels and winding staircase of Coco Chanel’s first apartment at 31 Rue Cambon, the impeccably polished leather saddles displayed in Hermes’ private museum on the Champs Elysees, and the pride that every Ducati factory worker takes in the hand craftsmanship of their bikes. Luxury goods companies and their customers value heritage above all else.

When a consumer purchases a luxury good, he or she is saying to the world: “I am an elegant and tasteful creature unlike any other.” This has particularly taken root in emerging countries in Asia, the world’s fastest growing luxury market. For example, the increasing wealth disparity created by the Chinese government’s policies has created a need in the wealthier subset of the population to differentiate themselves, and they unabashedly embrace luxury goods as a primary mechanism to achieve this.

The primary issue is that luxury goods companies’ desire to maintain their brand image and tightly control their inventory, which directly conflicts with everything that e-commerce has come to represent. A flagship store in Paris, Shanghai and Milan communicates heritage and exclusivity, but a shopping cart over a teenager’s bubble-gum colored mobile phone does not.

However, this is all starting to change. Start-ups in the luxury space have begun to shake things up and make a splash.

The secret sauce of a successful luxury good e-commerce business is a founder and team who understands basic luxury consumer psychology and knows how to tap into it — companies like Ahalife and Net-a-porter have done especially well. In the past few years, curation has made e-commerce more personalized, subscription has allowed vendors to control product availability, and companies like Warby Parker and Urbanara have proven that brands can be viably created through a predominantly digital forum.

E-commerce is constantly innovating and will eventually evolve to a stage where luxury companies can digitally offer consumers an experience they can currently only offer in-store. We have a long round ahead, but it’s clear that the luxury goods industry should not continue to ignore e-commerce.

Jenn Wei is a venture capitalist at Blumberg Capital, an early stage venture capital firm based in San Francisco. Prior to Blumberg Capital, Jenn worked in technology investment banking and consumer/fashion private equity in New York. Jenn received her MBA from Stanford Graduate School of Business and B.S. in Engineering from Duke University.

Follow her on Twitter: @jennjwei

Top image via Shutterstock 

Wholesale fashion buying and crude oil refinement don’t have much in common — except both are run by a pair of Koch brothers. Peter and Karl Koch, not to be confused with titans of industry and conservative sugar daddies David and Charles Koch, are the men behind Balluun.

Balluun is a business-to-business startup that connects fashion designers with retailers. It incorporates social, management, and transactional platforms to simplify the entire process of wholesale buying. While other companies like NuOrder, Brandboom, and Joor are out there, Balluun is notable for putting the social networking aspect of the business at the forefront. And for raising $3.8 million.

Peter and Karl’s family owned a fashion retail business. They grew up traveling all over Europe with their parents to attend trade shows and felt first hand how expensive, tedious, tiring, and inefficient this process is. Now from their headquarters in Foster City, Calif., these German brothers have gathered 10,000 users on the platform, which they say is increasing by 700 each month.

“We knew that companies connect and transact at trade shows, yet they are prohibited by cost and time,” said CEO Peter Koch. “We developed our technology to exactly replicate the trade show experience by allowing fashion brands and retailers to discover, connect, collaborate, and transact in real time, as if they were meeting face-to-face.”

Companies and brands place their collections online, and buyers browse to look for potential business. They can reach out to people already in their network, or use the platform to discover and engage with new brands. Balluun describes the communication feature as “multilevel, thread-based microblogging” that companies can use for initial interactions, purchase orders, and payment processing. For designers, Balluun helps with exposure and distribution. Buyers benefit from an easier channel for discovery and less paperwork.

Finoris AG and a group of Swiss private investors participated in this first round of funding.

Like floral prints, leather, and the color white, ‘democratization’ is a hot trend in the fashion world — and the internet is a strong force driving that evolution.

For this year’s series of Fashion Week events (in New York, Milan, and Paris), big name designers are holding digital fashion shows accessible to the public, not just the fashion elite. There is real time video footage of models walking down the runway. Google+ hangouts backstage with designers also provided a rare glimpse into the behind-the-scenes action. Even fashion doyenne Diane Von Furstenberg wore Google Glass spectacles to produce a first-person video of her adventures.

Democratization goes further than merely broadcasting fashion shows in new ways. Now, instead of a core group of tastemakers, social media activity reveals which collections are hits and which fall flat. Similarly, content from bloggers and Instagram is just as prevalent as content created by magazine editors and professional photographers, and can be just as influential.

Furthermore, fashion companies are using big data analytics and forecasting technology to predict trends, rather than relying solely on words from industry leaders.

This embrace of technology has been a long time coming. There are several reasons why the fashion industry has been slow to jump on the cutting edge of tech. Many designers want to maintain the prestige of their brand and tight control over how it is presented. Every detail, from the shade of lipstick to the order of the models to the lighting, is meticulously chosen, as are the members of the audience.

But that’s finally starting to change.

“Fashion Week was once only accessible to the elite,” said Eventup CEO Tony Adams. “I think the fashion industry has been slow to adopt new forms of media because initially, most designers felt that fashion is an experience that is hard to replicate online, but the abundance of online fashion portals, live streaming, and social media are making fashion more accessible than it has ever been.”

Eventup is a startup that matches events to venues. This year at New York fashion week, the company helped multiple designers plan their runway shows and published an infographic on the evolution of fashion week.

Media companies like IMG and KCD are producing digital shows that sends the glitter and drama of haute couture into living rooms, while media outlets like the New York Times and Wall Street Journal provided live stream coverage of events. Now those of us who don’t have closets full of Dior dresses and Jimmy Choo shoes can watch an event at the same time as the A-List celebrities doe. But this does not necessarily undermine a collection’s status.

“Ten years ago, the idea of someone in South Dakota watching a live stream of a runway show was outlandish,” said John Jannuzzi, a digital editor at Conde Nast’s Lucky Magazine. “Now, everyone is watching it at the same time, but accessibility does not make it less exclusive. Nothing compares to being at the actual show.”

Big data and internet broadcasting

Broadcasting event footage to the masses opens collections up to tremendous amounts of discussion across social networks. People of all backgrounds and ages can offer their opinions, but the power of social media means these opinions actually have an impact. Viewer reactions to runway outfits can indicate what themes were the most well-received and popular with potential consumers.

Editd is a big data company that provides actionable information for fashion brands. It not only analyzes the amount of traffic surrounding designers or trends, but also looks at the sentiment surrounding data points. According to its reports, New York consumers like feminine and retro aesthetics, while Londoners dislike the presence of dip-dye.

Another fashion big data company, The Whispr Group, provides a “social media intelligence service” to help designers assess the effectiveness of their social media efforts. The team created an infographic about which designers “stole the social show”, with Victoria Beckham, Marc Jacobs, and Diane Von Furstenberg rising to the top.

“Brands can see which hash tags drive the most engagement,” said Whispr exec Linda Harleman. “They see the top themes and looks people were most excited about, and maybe use that to develop new strategies and inform their content calendar.”

Reinventing fashion shopping

For some of the most luxe, avant-garde design houses, paying attention to social media may not be a top priority. However, brands marketing their clothes to customers outside of a wealthy minority have to adapt to a new paradigm for exposure.

“An advantage of social media is it exposes a more widespread audience to brands at fashion week,” said Adams. “Twitter and Facebook are key platforms for customer sales and engagement, as well as driving traffic to brands sites. Also, Instagram has been a great platform for designers to test their new designs by posting a picture and tracking how often it’s “liked” by the brand’s followers. Social media should be a personal and authentic experience.”

Startups have also revolutionized the way shopping happens at fashion week. Before, standard practice was to sit in the audience, frantically take notes as models flit past on the runway, and then scramble to place orders and be put on wait lists for items. This year, there are apps for show attendees dedicated to documenting looks, as well as for live blogging and managing hectic schedules.

Social commerce site Lyst lets users browse through the inventories of thousands of brands and add desired items to their “list.” Users can also subscribe to feeds centered around designers, bloggers, stores, magazines, and their friends. The company offers a runway tracking feature where fashionistas can add make a list of their favorite looks and receive alerts when they become available. This year, Lyst offered “Live Lysting” with style mavens Nina Garcia and Olivia Palermo, as well as the Google Plus hangouts with big names like Rebecca Minkoff.

“Lyst is all about empowering the consumers,” said head of business development Hilary Peterson. “The hangouts gave them unprecedented access and a glimpse of the backstage atmosphere, while also allowing them to ask the designers anything they wanted live before the show. So we really felt like we were giving consumers, who aren’t normally at fashion week, access to something special.”

Fashion’s tech invasion

Technology infiltrated fashion week in other ways. Digital prints were a popular trend, as were retro aesthetics reminiscent of Instagram. The internet also provides a useful tool for fledgling designers to cheaply produce and publicize their own fashion shows and potentially rise to stardom. Microsoft even partnered with Bloomingdales to create a high-fashion, high-concept, high-tech dress, complete with circuit boards, and style startups were able to get off the ground amidst all the noise.

For this grown up little girl who loves both fashion and technology, this is a trend I am thrilled about.

There are misconceptions about how important branding it is to success, how much work it takes, and the best ways to approach it. But every company, from a fresh-faced tech-startup to Apple, knows good branding can make a product or service.

Branding is how you present your company — your name, imagery, reputation — to the world through logos, ads, marketing materials, websites, apps, and social media. Left-brained business types may see it as simple graphic design, like choosing a logo color, or as a mysterious art. But experts know successful branding is hard and the best results are based on research, facts, and a well thought-out road-map.

We talked to Chris Mayfield, head of the Austin-based company Crispy Design, about how companies of all sizes can get the most out of working with branding professionals. Here are his guidelines for success:

Do your research

The most important work for successful branding takes place before a designer or agency is even hired: research, planning, introspection, and difficult decision making by the client. The worst thing a company can do is go to a design agency without having collected key pieces of information and expect the designers to fill in the blanks.

First, decide exactly what you want to communicate and who you want to communicate to — who is most likely to buy your product? Then, break down what your company does and identify its strengths and weaknesses so you can develop an approach that promotes its former and diminishes its latter.

If you don’t have this level of understanding of your own company, you won’t be able to engage with the agency enough to have their work be beneficial.

Pick a specific goal

Once you’ve done the advanced research, settle on a specific, actionable goal. Instead of saying, “We want to make more money,” try “We want to increase our market share with rural females between 18- and 25-years-old.” A scattershot approach will be less effective than a tightly focused strategy and will make it harder for you to gauge your success.

You can ask your branding agency to suggest a direction, but Mayfield says this is ill-advised. The third-party team you’ve hired to work on branding has only known your company for a short period of time, but you’ve been living and breathing it for years. You have the best understanding of your company and what it is trying to accomplish.

Communicate to your agency exactly what you’re trying to do over the next six months or a year. That way it can completely optimize what it’s trying to do for you.

Don’t be a copycat

A common first instinct it to replicate what a successful company, like Apple, has already done, which is short-sighted and not to anyone’s benefit. Blindly imitating another company’s branding strategy never works out.

“Many small and medium business think it’s like divinity if it was done before,” said Mayfield. “They think Facebook was built by Moses and was without fault.” Just because another company has already “perfected” an approach, doesn’t mean doing the same thing will work again for a different product or service.

Just as ill-advised as copying the big companies is emulating your competitors. Mayfield says this is the antithesis of branding. You want to set yourself apart from competitors. Branding should explain, in tone and visuals, how you’re different from them, not how you’re similar. This is a hard leap for many people.

“For small companies, a risk is exactly what they have to take,” said Mayfield. “This is generally their one chance to do something incredible.”

Embrace technology

Today, there’s no limit to how you can promote a product or service. Technology offers companies incredible opportunities to do things in a whole new way, such as using Facebook to target a very specific demographic. But you must understand the technology (or hire an agency that does) and be willing to go in unexpected directions.

Traditionally, ad agencies just want to make print ads and TV spots, and marketers want to put logos on frisbees and swag. But the landscape is changing; interactive and social media agencies are being added to the mix, and everyone is starting to use technology creatively to reach potential customers.

Take Sweat Leaf Tea. The company believed two things: that anyone who tried its iced tea would try it again, and that people are more likely to want a nice cold drink when it’s hot out. The agencies working on the project decided to geolocate people using an IP sniffer, and cross-reference that info with the average temperature where they were located. If it was above a certain degree, they would offer them free tea.

Social media is the technology that gets all the attention, and while it is an incredibly important part of branding, it’s also not the most complicated. The key to social media is putting in the work and being active in a space. The best social media plans are often the domain of content directors, as they’re the best at promoting their company’s own intellectual prowess.

Keep it simple

Vacuum-company Dyson explains a complicated product clearly. As technologically innovative as the company is, it’s able to communicate quickly and succinctly what its products can do. That simplicity is the cornerstone of a good brand, but can also be applied to the branding process itself.

It’s possible to overwork brands. Take logo design: a smartly designed logo doesn’t try to convey every aspect of a company, just give an impression. Attractive design should come ahead of cramming in literal representations of what the product does, or hunting for the perfect color to make someone want to spend money.

“Colors communicate things like fear, hunger, cold, and danger. They don’t communicate something like trust,” says Mayfield. Symbolism is another equally over-thought element of logo design. Sometimes it works, like when banks try to communicate stability with Grecian pillars. But don’t believe an agency that shows you a shiny object and tells you it communicates synergy. They are just trying to sell you on their design, and that’s a disservice to your company. The focus should be on making the design look contemporary.

Step back and let the agency do its work

If you have done all of the research and strategy work, step back and let the people at the design agency do what you have hired them to do. Don’t try to micro-manage the process. If they don’t do a good job, don’t hire them again. But if you’re constantly derailing their work, you’ll never get the best out of them or the experience.

Image via rishibando/Flickr

In the film Blade Runner, a replicant was a biorobotic being which was virtually identical to a human but lacked emotion and empathy. I talked to Jakobsson about the future of interfaces and how they should use “the human APIs”.

“We see people and machines interacting in a very dumbed down way” he says. Jakobsson complains that 90 percent of the status updates in his Facebook stream are from Foursquare, Runkeeper or Gowalla.”The interface through which we are talking to each other is GPS coordinates, how many kilometers I have been running and songs shared on Spotify. We are using the APIs of a machine instead of the human APIs like voice and feelings and movement”.

Jakobsson sees a possible future in which our lives become cluttered with ever-fancier screens (see TAT’s future of screens video below), augmented reality and other machine-driven interfaces. “It’s not augmented reality, it’s dumbed down reality” he comments. “We come from an era where everything is clickable. Now we are saying, everything that is clickable in real life, let’s put a red tag on it, which is talking technology language. You are forcing people to become robots.” His alternative is to make interfaces more human and he sees designers as crucial to that process. “How do we create people to machine to people interfaces which make that interaction natural?”

Jakobsson is Swedish and he uses the analogy of cross-country skiing to explain the role of the designer. There is a huge difference between the effort required to ski on virgin snow and on a pre-defined track. The traditional role of the user interface designer was to make tracks that users can follow. While one of the designer’s jobs should still be “to create highway tracks”, Jakobsson would also like to see a process where users are allowed to ski around on a metaphorical open field and the tracks they create can be used by others. He describes this a more heuristic way to create a user interface.

Just as importantly, Jakobsson thinks that the designers role is not just to make a product pretty, something he regards as “lipstick on a pig” design. “Designers should be in the depth of engineering and even before engineering.” A large part of the designer’s task is to identify the specific niches or use cases which a product should address. “The question is really ‘Should we build a church or a monastery?’ Right now we are building holy places.” he explains. In other words, most technology products, and mobile phones in particular, address too broad an audience and set of uses.

“I think we will see much more of people having text and talk phones, in a sense. Simplifying but not dumbing down.” he says. “The problem today is that there are really just two phone categories: a smartphone with bells and whistles and no battery life or an old phone like a Nokia series 40″.

Every handset manufacturer is finding it hard to escape the trap of building an iPhone copy. Jakobsson cites INQ mobile as an exception to this trend. INQ makes phones designed for specific niches like social networking. “Let’s build this phone which has built-in Spotify and built-in Facebook. It doesn’t even look like an iPhone. I think INQ is going to be really successful” he says.

I asked Jakobsson for some examples of user interface technologies he likes. “I like gesture interfaces because that’s a very human approach. Gestures are very much more tactile.” But he also thinks that more natural interfaces introduce new problems. “The minute you do direct manipulation, for example using touch, it needs to be perfectly responsive. We are getting into the concept of the uncanny valley (when robots look and act almost, but not quite, like humans and actual humans are repulsed) for interfaces when you add physics engines, gestures, etc. because we are manipulating human to human interactions. When they are ten percent off, it’s just going to feel weird.”

He’s also not a big fan of haptics. ”Haptics for me is like voice recognition. It’s the best idea in the world but it just doesn’t work. In 5 to 10 years they will both work.” The ideal for Jakobsson is that technology starts to disappear. “The device you are holding in your hand will become thinner and thinner, not physically necessarily, but conceptually. You are going to think that you are not even holding a device.”