Stitch Fix founder Katrina Lake will be stepping down as CEO, effective August 1st. She will be replaced by Stitch Fix President Elizabeth Spaulding. Lake will still work for Stitch Fix, serving as executive chairperson of the board.
What Occurred After This Announcement?
Right after Stitch Fix officially announced the new transition of power, stock in the company fell in value. According to a Fast Company report, the Stitch Fix stock closed the day of the announcement at $49.49, which was a decrease of 2.46 percent.
Stitch Fix stock is currently valued at $46.58. (Note: This story was posted before the stock closed for the day.) Although it’s gone down recently, the value of Stitch Fix stock has increased dramatically from last year, where it was valued around $12 dollars in March 2020, according to a Fortune report.
What Is Stitch Fix?
For those who have never tried Stitch Fix, the company specializes in personal styling. What’s neat about Stitch Fix is that there is no subscription required to try out the service (you do still have to pay for the clothes, of course.)
Anyone interested in trying out Stitch Fix starts by taking a personal style quiz. A stylist will personally curate wardrobe choices for you based off of your quiz answers. Then you can try on the clothes at home and send anything back you don’t like. The company offers clothing options for women, men and kids.
Shipping and returns are free, and users can buy clothes on demand or schedule regular deliveries. Customers only pay for what they keep and a styling fee which also acts as a credit to clothes one decides to keep. Clothes for women and men range from $25 to $500 dollars, and users can specify their price range that they want to stick to in their style quiz.
Elizabeth Spaulding, who got her MBA from Stanford University, stated in a recent interview with CNBC that the timing for the transition, “felt right.”
“Really, the timing felt right…Covid has accelerated everything for us as a business, and over the course of the last year, we’ve really been able to invest in our future.”
Spaulding also noted in the CNBC interview that Stitch Fix added more clients in the last two fiscal quarters than in all of 2020.
Lake was actually the youngest woman to take a company public when Stitch Fix had their IPO back in November 2017. (CEO Whitney Wolfe Herd of Bumble has now taken that title.) Although she’s stepping down as CEO, Lake will not only serve as executive chairperson of the Stitch Fix executive board, but will also work on Stitch Fix’s social impact efforts and more. Lake founded Stitch Fix in 2011 while attending Harvard for her MBA. Ten years later, and now the company has 8,000 employees and counting.
According to a Fast Company report, Stitch Fix currently has annual revenues of $1.7 billion with nearly 4 million clients.
Spaulding will also join the Board of Directors for Stitch Fix. It will be interesting to see where Spaulding and Lake decide to take the company next in their new roles.