Once considered the beacon of fast fashion success, beleaguered retailer Forever 21 finally filed for bankruptcy this past September. For many, it was a time of reckoning as the retail industry debated the longevity of the fast fashion trend. For 32-year-old cofounders Nina Faulhaber and Meg He of ADAY, a minimalist brand for high quality basics, it was more of a confirmation that they were slowly building a fashion company that was built to last.
Now the company has announced that it has closed an $8.5 million Series A from Downing Ventures, H&M Co:Lab and others. The latest round brings the five-year-old company’s funding total to $10.5 million.
“Our first capsule collection was only seven pieces and to this day our mission is to create a better wardrobe with fewer pieces,” says cofounder Nina Faulhaber, noting that fashion is one of the world’s worst industries for the environment. “Clothing that does more with less is a much more sustainable way of living.”
The duo, who serve as co-CEOs and made the Forbes Under 30 list back in 2016, originally met while working as analysts at Goldman Sachs nearly one decade ago. Though they both soon departed to join different venture capital firms, they stayed in touch and eventually started batting around the idea of a company inspired by the success of athleisure. As it became more popular to wear Lululemon leggings to places outside of the gym, they began envisioning a chic clothing line for the office that captured the comfort afforded by yoga pants.
Since their initial athleisure-inspired basics collection, the company has slowly expanded to knits, satin, dresses and travelwear. Last week they launched their first line of suits featuring stretchy, wrinkle-free fabric. For investors, their methodical system of introducing wardrobe staples has eased worries about investing in the notoriously fickle fashion industry.
“A lot of VCs are scared or nervous about investing in fashion because it’s capital intensive and super crowded. We’re bombarded with new brands launching on Instagram all the time,” said Downing Ventures partner Kathy Gromotka, who confirmed the company became profitable mid-2019. “What we liked about ADAY is that they genuinely have a cult-like following.”
Key in cultivating that following has been enlisting customers to help prototype new pieces, even after a product has launched. For example, since the popular Something Borrowed Shirt premiered in February 2017, it has gone through over a dozen iterations that lowered slits, adjusted buttons and even replaced the fabric with recycled fabric.
The company plans to use the new funding to build up their inventory, which often depletes quickly prompting waitlists for items. The company says this has been a barrier to them being able to grow more rapidly. They also plan to use the funding to continue investing in the adoption of more recycled fabric to further entrench sustainability into the company’s strategy (products like the Up In the Air Jacket already use custom ADAY recycled fabric).
“We both come from finance, technology and venture capital backgrounds, so we didn’t know really know much about creating fashion but we did know about building products with a lot of data,” cofounder Meg He says of their slow fashion mentality. “I do think we wanted to do a different trajectory than other brands because ultimately we are about being around for the long run.”