As one of Silicon Valley’s most well-known venture capital firms, Kleiner Perkins was an early backer of Amazon, Google and Twitter. But it recently invested in a different kind of disruptive startup: Re-inc, the gender-neutral fashion and lifestyle brand from US women’s soccer star Megan Rapinoe, the pink-haired, gender equality activist known for leading the US to World Cup victory, and her teammates Tobin Heath, Meghan Klingenberg and Christen Press.
Amid an industry-wide reckoning for better inclusion and diversity, this vote of confidence from a traditional VC firm signifies that rethinking gender norms isn’t just a cultural groundswell — it’s something that might make money.
“There's a shift happening around what fashion looks like and who people look up to as role models, and I felt like they had an opportunity to be leading the charge on some of that,” says Kleiner Perkins principal Annie Case, who invested an undisclosed sum in Re-inc, whose streetwear and athleisure is released as capsule collection drops in gender-neutral sizes from XXS to XXXL.
“It was less about wanting to push into fashion. We think a lot about both online and offline communities and human expression, and this was a really interesting example of fashion as a wedge into these broader communities and beliefs.”
Klingenberg says that the funding “communicates that everyone — including investors — are ready for change. New leaders and new business concepts”.
There is still some way to go. The investment community has been slowly looking at gender non-conforming and LGBTQ-led brands, which often go hand-in-hand in conversations about representation in fashion. In June, Ohio-based VC firm Loud Capital announced the Pride Fund 1, a $10 million fund that will invest in companies led by LGBTQ+ founders. The fund’s CEO, Densil Porteous, said that a couple fashion brands are under consideration. And last May, gender-neutral underwear and swim brand TomboyX received $18 million from investment firm The Craftory.
It is still early days for the market opportunity to be fully tested. A 2019 study found that 27 per cent of Gen Z are interested in gender-neutral clothing lines. Combined, US Gen Z and millennial consumers account for $350 billion in spending power.
Rapinoe is ebullient: “We felt like the world is moving in a gender-fluid direction, and we’re seeing it too,” she told Vogue Business. “Fashion is a bit all over the place… and we saw the opportunity to really break through binary gender norms.”
Redefining norms
Re-inc was introduced one year ago amid a gender-discrimination lawsuit against the US Soccer Federation and three days before the start of the Women's World Cup (in which three of the founders played). This highly publicised suit, which argued that women should be paid more equitably, combined with the World Cup win, made them well-positioned to parlay gender equity from the field to fashion.
This is partly why Case, who played soccer with Press while they were both students at Stanford University, invested. “They stand for so much more than just the T-shirt,” she says, adding that they come with a built-in community of fans who appreciate both their activism and their fashion sense. “As the world transforms rapidly, we need a reset,” Press says. “We are looking to disrupt the male-dominated fashion industry by making clothing for all, made by women.”
Investing in challenger brands
The Craftory co-founder Ernesto Schmitt, who led the investment in TomboyX, says that while the firm’s mission is to invest in “challenger brands” — including those that might have been left behind in terms of equality or diversity — it is not a charitable vehicle but rather an investment house with the intention to make profitable returns. In researching TomboyX, whose hero product is boxer briefs for women, it was clear that there was enormous potential not only because of the fit and function of the product but because it offered a broader representation of femininity, he says.
Schmitt estimates that 20 to 30 per cent of consumers now prioritise purchases based on a product’s mission, rather than its function, even if it is more expensive.
This presents an opportunity for investors. “You’re seeing many funds, including tech funds, now invest in consumer goods brands because they see that that is where the future value lies. Brands like TomboyX are in an exciting space because they represent a new manifestation of the zeitgeist,” he says. Often, he adds, this forces incumbent brands to adapt. He anticipates that brands will increasingly incorporate non-binary offerings, but doubts if consumers will find it authentic.
“Many brands have built their businesses on being more sexualised or specific to a gender, and for older brands, it's hard to shift,” Case says. “Companies that are really well-positioned are those who are not having to change or adapt their values. Re-inc is touching on a lot of the themes in reaching [Gen Z] in an authentic way, rather than trying to generate a report on, ‘What does Gen Z value? Let’s go build toward that’”.
Beyond gender
In 2016, Porteous, of the Pride Fund 1, wore a tunic from gender-neutral apparel brand Olly Awake. This opened up his eyes to gender-neutral clothing, and helped shape his investment thesis with the fund, for which he is now looking at two fashion brands from LGBTQ+ founders. “It's individuals who are pushing boundaries and redefining what fashion is. For so long, we developed fashion in spheres of male and female,” he says.
Porteous says that investing in LGBTQ+ founders means not just investing in brands that are targeted toward a queer or non-binary audience; instead, it’s an effort to invest in people, and ideas, that might have been underrepresented previously. TomboyX, Schmitt points out, is not necessarily about being a gender-neutral brand, but rather an antidote to “antiquated representations of women in underwear”.
Rapinoe even rejects the limitations of the label “gender neutral”. “All of us founders like to dress in a way that’s almost beyond gender. It’s not about neutrality or even fluidity. It’s just about wearing what looks and feels great to us,” she says.
However, Porteous counters, while a founder’s gender identity or sexuality is not the reason they might receive funding, it might be what led them to a great idea. “It’s not central, but it’s relevant,” he says. “The business idea has validity, but a cis-gendered white guy would probably not think of that in this moment.”
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