Fashion
Rent the Runway to swap debt for equity in revival effort
By
Bloomberg
Published
August 21, 2025
Rent the Runway Inc. will hand over a controlling stake in the company as part of a plan to cut debt and grow, after residual effects of the Covid-19 pandemic pushed the firm to the brink of bankruptcy.
The deal, with lender Aranda Principal Strategies and other partners, will wipe more than $240 million of debt from Rent the Runway’s balance sheet, according to an emailed statement. The company, which allows subscribers to rent clothing for the office and events, will have several more years to repay $120 million in remaining borrowings.
Private equity firms Story3 Capital Partners and Nexus Capital Management, along with Aranda, will also inject $20 million into the company as part of the transaction. Aranda was spun off from Singapore’s Temasek Holdings Pte. as a private credit platform earlier this year.
The three investors will receive a majority ownership stake in the company, representatives for Rent the Runway said in an interview — about 86% before accounting for a management incentive plan and a rights offering set to give existing stockholders the opportunity to purchase as much as $12 million of shares.
The offering will be at $4.08 a share, according to the statement. The stock closed Wednesday at $4.485, up from a record low of $3.77 in April. Shares have dropped by two-thirds over the past year. “I’m viewing this as an IPO 2.0 for the company,” Chief Executive Officer Jennifer Hyman said in an interview.
Rent the Runway’s operations and trajectory over the past 18 months encouraged lenders to agree to the plan, which allows management and current owners to retain stakes in the firm, according to Hyman.
“Every single financial metric has substantially improved over last several years, and we were able to do that with shackles on,” Hyman said, referring to the company’s debt load. She acknowledged alternatives included potentially filing for bankruptcy.
Its debt burden grew larger as it started paying interest in kind, which allows borrowers to defer paying interest in cash but tack it on as additional debt due at maturity. The decision was made in light of financial pressures stemming from the pandemic, when people stopped wearing chic work-wear in office and turned to pyjamas at home.
Hyman co-founded Rent the Runway with her business partner Jenny Fleiss in 2009, introducing people to the option of renting clothing for events. The company then started offering a subscription: members can borrow merchandise for a monthly fee.
The firm was valued at $1 billion in 2019, a figure that dropped to $750 million after the pandemic hit in March 2020. Rent the Runway went public in 2021, betting in-person events such as weddings would return, and had more than 147,000 subscribers as of the end of the first quarter.
The company has struggled to revive its business since its public listing amid a subscriber slump. Management executed a reverse stock split in 2024 remain on the Nasdaq. Revenue fell 7.2% in its most recent quarter.
Hyman has been working to revamp Rent the Runway’s operating model. The service has begun sharing revenue with brand partners — made possible in part by its shift to an “asset-light” model.
While Rent the Runway previously owned the inventory on its platform, it more recently shifted to a model that allow brands to put their items on the platform for free and receive a portion of the revenue generated when the goods are rented out. Hyman plans to hone in on that strategy after the recapitalisation and find more companies to work with.
“My primary action post this deal clothing is doing even more deals with brand partners around the world,” said Hyman. “It allows us to invest in even more inventory.”
More merchandise is critical to the company’s revival effort, and management hopes that a larger assortment of items will lure more subscribers. Rent the Runway has added 1,000 new styles and expects to accelerate that process.
Published
August 28, 2025
Central London’s department stores continue to attract brands for pop-ups and permanent spaces with Selfridges, Harrods and Liberty all adding key names recently.
Luxury lifestyle brand Smythson of Bond Street has opened a new concession in the latter. It’s in Liberty’s homewares department on the third floor. The brand’s signature diaries, notebooks, and stationery, along with a selection of leather accessories and a curated edit of the brand’s bestselling bags are all on offer with personalisation also available.
The brands have developed an exclusive limited-edition range of Smythson x Liberty products with the first collection having just launched. There’s a selection of signature notebooks and diaries in Liberty Purple, Smythson’s Nile Blue, and a seasonal Coral colourway, each lined with a Liberty silk in coordinating colours. The second edit, launching in November, will feature a range of bestselling accessories.
Meanwhile UK-based padel apparel brand Pulco has debuted at Harrods, becoming the store’s first-ever padel clothing label, underlining the sport’s surging popularity.
Products on offer include the key Aircon shirt made from an ultra-lightweight, Italian-engineered fabric “featuring a breakthrough weave that rapidly wicks moisture from the inside out, delivering unrivalled breathability and comfort in play”.
But as well as performance-wear, there’s a full lifestyle offering “blending elevated athletic apparel with understated, off-court elegance”. That means shirts, shorts, hoodies, jackets, T-shirts, sweatpants, caps, socks and more. Retail prices range from £10 up to £165.
And back in the West End, Samsøe Samsøe has moved to a new space within Selfridges that presents the Scandinavian brand’s contemporary womenswear “within the universe of its experiential design”. The pop-up revolves around the AW25 collection that also inspires the space, “which emulates the immersive ‘Radiant Connection’ exhibition” that Samsøe Samsøe introduced the collection with during Copenhagen Fashion Week.
Set against the backdrop of the exhibition’s set design and illustrated by the lookbook imagery of the season, the pop-up “becomes illuminated with the lime green shade that defines the visual identity” of the collection.
The brand said the pop-up is a “next step within Samsøe Samsøe’s ever-increasing focus on the UK market” and should help it reach new consumers.
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Bangladesh’s garment exports to the US surged 24.49 per cent in the first six months of 2025 to $4.24 billion, led by trousers and shorts, which made up 45.65 per cent of shipments.
Despite a heavy effective tariff burden of 35–36.5 per cent, Bangladesh has retained its dominance in bottom-wear exports due to strong price competitiveness.
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FIEO president S C Ralhan described the development as a severe setback, warning that around 55 per cent of India’s US-bound shipments, worth approximately $47–48 billion, now face pricing disadvantages of 30–35 per cent. This, he said, makes Indian products uncompetitive compared to those from China, Vietnam, Cambodia, the Philippines, and other Asian producers.
FIEO has warned that the US’ additional 25 per cent tariff on Indian goods, raising duties to nearly 50 per cent, threatens $47–48 billion in exports, hitting textiles, leather, and other labour-intensive sectors.
President S C Ralhan urged urgent government support, credit relief, expanded PLI schemes, FTAs, and stronger diplomacy with Washington to sustain competitiveness.
The textile and apparel hubs of Tiruppur, Noida, and Surat have already reported production halts due to eroding cost competitiveness. Other labour-intensive sectors including leather, ceramics, chemicals, handicrafts, and carpets are also expected to face order cancellations and reduced global competitiveness, FIEO said in a press release.
In response, the president urged immediate government intervention. Suggested measures include interest subvention schemes, enhanced export credit support, low-cost lending for micro, small and medium enterprises (MSMEs), and a one-year moratorium on loan repayments. He also called for automatic credit limit enhancements of 30 per cent, collateral-free lending on emergency credit line guarantee scheme (ECLGS) lines and expanded production-linked incentive (PLI) schemes.
FIEO further emphasised the need for aggressive market diversification through fast-tracked free trade agreements (FTAs) with the EU, GCC, Africa, and Latin American nations, alongside investments in cold-chain and storage infrastructure. While diversification is key, the president underlined that urgent diplomatic engagement with Washington remains critical.
Promoting ‘Brand India’ through global branding, innovation, and quality certifications was also highlighted as a long-term strategy. FIEO has appealed for swift, coordinated action between exporters, industry bodies, and the government to safeguard livelihoods and maintain India’s export momentum in the face of escalating trade headwinds.
Fibre2Fashion News Desk (SG)
Smythson opens at Liberty, Pulco at Harrods and Samsøe Samsøe at Selfridges
Bangladesh’s US garment exports surge in H1, led by trousers & shorts
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