Thirty Minute Mentors Podcast Transcript: The RealReal Founder Julie Wainright

I recently interviewed The RealReal Founder Julie Wainright on my podcast, Thirty Minute Mentors. Here is a transcript of our interview:

Adam: Our guest today developed a new fashion category from concept to roughly $1.5 billion in gross merchandise value. Julie Wainwright is the founder of The RealReal, which is catered to more than 32 million shoppers. Julie's newest venture is Ahara, AI-driven personalized nutrition planning. Julie, thank you for joining us.

Julie: Oh, thanks. I appreciate it, Adam.

Adam: You grew up in South Bend, Indiana, and were raised by parents who are artists. You did your undergrad at Purdue before taking a job in marketing at Clorox and then breaking into the world of tech. Can you take listeners back to your early days, what experiences and lessons were most instrumental to shaping your worldview and to shaping the trajectory of your success?

Julie: I would say when I got to Clorox it was great training. And I was the second undergraduate they ever hired. So I had a lot to learn. It was fabulous. But I didn't want to be the people I saw above me. And in the meantime, the personal computer software industry was just at its nascence. I knew my former boss’s at Clorox wife had joined the computer industry. I went down to meet with the entrepreneur that founded this company called Software Publishing. I met the people I was meeting, but more importantly, before that happened, a guy in finance at Clorox literally smuggled in an Apple 2 (his is going to really jog some memories) running VisiCalc to run P&L on something that we would hand calculate, do what-ifs for hours. And once he set it up, we could have every scenario that we could imagine within minutes, and I'm like, this is the future.

Adam: What were the keys to rising within your career? And what can anyone do to rise within their career?

Julie: I would say there's a couple of different things. One, I'm a risk taker, so you have to be willing to be a risk taker. Number two, I like being accountable. So you have to be accountable. And number three, you're always going to win if you positively impact the P&L in a company. So doing anything that actually makes a difference on the revenue or the profits of the company, or ideally both, that's demonstrable, and you can be held accountable, automatically gives you the experience you need to take the next step, but it also is evidence-based that you can do it. In order to do that, at least in the tech world (the tech world is a collaborative world, where you also have to learn how to collaborate for results), it's not hierarchical. It's gotten more hierarchical, as it has matured, but startups or younger companies by their nature are collaborative. So you can't rely on what was done before. You have to be a creative problem solver. You have to be hierarchical. You have to be accountable. And you have to impact the bottom line and the top line.

Adam: What were the most important skills that you developed as you were rising within your career? And what are the most important skills that you utilize today and have utilized over the years in leading different businesses?

Julie: Look at Clorox. It was great training. You really got deep P&L training, the business and consumer training was great there. So that's really important. I understand the levers and a profit and loss statement, really important. But I kept taking on more areas. So even though I started in product marketing, brand marketing, I then took on sales, then I took on international sales and marketing. And I understood the profit and loss, the P&L, really well and the key levers. So by taking on a broad range and expanding my focus, I was able to actually broaden my skill set and drive results. And I would say it would be very hard for someone if, let's say they came up in the accounting world, unless you're in an accounting company, it's very hard to move to a CEO job or a much broader job unless you're in a company that is that expertise, but even then you have to understand what drives sales. What drives behavior of your customer bases, how the development team works. So you have to understand other people's functions, you don't necessarily have to do it. But you have to understand the role and how it works to drive the company.

Adam: Take a holistic view, no matter what you're doing. If you get stuck in your silo, if you don't understand how the entire business works, what everyone else around you is doing, and how their jobs work. You don't necessarily need to know how to do everyone else's job but you need to have an understanding as to how the pieces flow together, how everything works.

Julie: And then the other thing is you have to know how to hire and you have to know how to fire. At the end of the day, it's all about the people. So you have to be able to hire people that also want to be accountable, that share your values and can buy into the vision of the company. And the people that aren't working out well, you have to be able to let them go quickly. So at the end of the day, no leader is made with one person, you really need a team around you that is great in their functional areas. And you need to learn how to work with that team and keep them focused on the high-order bet at all times.

Adam: What do you look for in the people who you hired over the years? And what are your best tips on the topic of hiring?

Julie: Well, I've been in the tech industry, and I've been more on the entrepreneurial side of it. So what I'm going to say really isn't applicable for other industries. But if you look at what's really important in the tech world, they have to be a collaborator, they have to be accountable, they have to be a great problem solver because chances are, they're going to come into an environment that has a lot of gray area. So they have to be a great problem solver. If they have a hero mentality, probably not going to work because it's not about one person. And in the past, they have to demonstrate that they did own something, they drove it to results, they worked well with others. And then they have to be a risk taker because they have to feel comfortable with that. What's really fascinating is, as a company grows, especially in the tech world, you still need those people, but you might need deeper functional expertise. And that's where it gets a little tricky. Every time I veered into hiring people from a corporation without an entrepreneurial stent, it's always been a mistake. And I would also say if someone is the founder of a company, hiring corporate execs on your board, probably not a great idea because they've never seen high growth. Innovation is not something corporations are known for. They're known for iteration not innovation. So you want to make sure your values and the experience match on the board also.

Adam: I want to dive into that more. But before I do, I want to dive into the initial point you made, which is, this is only relevant in the world of tech. And I'm gonna push back on that because I've interviewed hundreds of the most successful leaders and what you just shared is applicable to anyone in any field.

Julie: Well, they say that. I don't know if I buy it, and I'll tell you why. The best entrepreneurial team I've met absolutely would die in a corporation. So they may say that, but politics and iteration rule in corporations, and it bends toward the political, where startups and entrepreneurs will bend toward a meritocracy. And you can hide in corporations, you can hide in someone like Facebook, or Google, or even Amazon because the company's got too big. In an entrepreneurial world, every role has to be accountable. And if you're playing politics, you're most likely going to wash out. It really is what you do, not who you suck up, to be blunt. I know what people say, but then, I've been working now for over 40 years, so I would say: There's a huge disconnect between what works in a corporate world and what works in an entrepreneurial environment. And I will say, what I just described transcends technology. It's more of an entrepreneurial environment.

Adam: So Julie, I agree with a lot of what you said. I've worked for some of the biggest companies out there. I have started and led very small startup companies. I agree. There's a very, very different mentality in a huge Fortune 500 company. I work for a Fortune Global 150 Bank, comparing that to starting a bootstrap business, it’s very, very different. With that said, when you're a leader and you're looking for your absolute best performers, the characteristics that you ticked off, the best leaders are looking for those things. You're looking for people who are collaborators. You're looking for people who take accountability, you're looking for people who are problem solvers. That's universal.

Julie: Oh, that I agree with. But the other difference is, tech people need to be innovative. They need to buck trends. They're not necessarily rule followers; they're objective followers. And when we get in people that actually spend a lot of time talking about what can't be done or if we do this, then this could possibly happen. It's probably not right, because entrepreneurs can't follow the rules. They have to look at things differently. So what you just said, I agree with. Beyond that, it's a different world. And also, you have to be comfortable. You see, corporations do have a roadmap. They already have been places. They know how things have been done. And they turn to get there like a huge ship. You can turn them but they take a lot. But when you get into a company that's really small, and this happened with The RealReal up until it was about over a billion, but up until it got to a billion dollars, one person could come in and make a huge difference, because we were still inventing the company as we were actually sort of building the car on the tracks when we were in the race. And then at some point, there were ways that things we knew had to be done a certain way because they worked. But then, having said that, COVID changed everything. So we had to redefine it. The other difference between what I've seen now, corporations are certainly catching up on this, but every startup in the last probably 12-14 years I've been involved with is heavily data-driven. And you have to be able to use data to help inform your decisions. You have to be able to understand data, extract the meaning, and you have to be comfortable with that. And the people I've met in corporations are still more anecdote-driven as they get their data in place. And it's getting better. It's gotten better over the last four or five years. It's had to, and I'm also talking about B2C companies. But in a B2C startup company, if you don't understand how to analyze data and draw conclusions to data and present your recommendations based on data driven decisions, you're dead in the water. And that capability is not universal in large corporations. They want it to be. I've even talked to people who put people in their board, and they were very senior execs at large companies, but they're anecdote driven. Okay, that's something. It's not really where the world is now. It's a data-driven world where you can actually get a lot of information and make better decisions.

Adam: How would you advise anyone listening to this conversation through thinking about the following question: Am I an entrepreneur? Am I not an entrepreneur? Should I start a business? Should I stay in corporate America? What would you tell them?

Julie: The interesting thing about being an entrepreneur is you realize that you're in a risky situation, but you're comfortable with the risk and that you know how to iterate. But I would say importantly, before you leave your corporate job, you better make sure that whatever you're going to do, you have a competitive differentiation, you understand the resources required in that business. And you have the confidence and the mental strength to withstand the highs and lows, because there's a lot of highs and there's a lot of lows, and you're just on it for a ride. And you have to recognize that’s the journey. It's risky. Highs and lows. You're going to need money. Let's say you want to be an entrepreneur and you think, ‘I've got this great team.’ Well, if your team's coming from corporate America, and they're your peers or your people you've worked with for years, they may not be the right team. So you have to do a really good assessment of the skills that you're going to need, what you bring to the table, what holes you need to fill, and then see if these people are risk takers.

Adam: I want to ask you about your best known most successful entrepreneurial ventures. You launched The RealReal when you were in your 50s. 

Julie: Yeah. How about that? 

Adam: Amazing. I love it. How did the idea come together? And how did you actualize it?

Julie: So first of all, I really felt like, if I didn't create my own job, I wouldn't get a job I wanted to work at. It was really sort of this point where no one's going to offer a woman in her early 50s (I was 51), but no one's going to offer a woman in her 50s a job in tech. And also I'd had a failure with Pets.com. So even though that was in the past, it was looming large. So I thought, ‘Okay, I want to create some place I want to work at.’ And I knew my strengths was in the B2C, so the business-to-consumer side. And then it came down to, ‘Who's my competition? How can I carve out something that's unique and salient to a large group of people?’ Which means you have to analyze what was already playing in the business-to-consumer space and areas that actually could be looked at. And the key one was, how do you compete with Amazon? Because I also knew I wanted to go into commerce, so not a service. So how do you compete with Amazon? And what can they do and what can't they do? And then mapping out other areas, and I had identified about four different areas that I thought would be difficult for them. But I had no ideas. I did have a framework and that framework was floating in the back of my mind at all times because I gave myself a timetable to start the business. And then I was shopping with a girlfriend, and there was some consignment in a full-price boutique in the back and my girlfriend shopped in the back. And that's where the light bulb went up, because I knew Amazon couldn't do luxury. And they've been trying for years, and they aren't going to get there, regardless of what their statements are. So Amazon could not do luxury brands. I wasn't going to create my own luxury brand but it was an area, I knew, that would be a huge hole. And when I saw how my friend who didn't need to shop previously owned goods reacted to these luxury brands, like a Prada, a Gucci, Louis Vuitton being offered in this beautiful store. And like that's it. And then I researched the competition in the luxury consignment space, and it was easy to compete with, and devised the plan and got started. And looked at the total market size, which was in the I think at one point, it's bigger than that now, it was about $600 billion worldwide potential. So a nice market size, in terms of what's trapped in people's homes in really established countries, let alone emerging growth countries. And I got started and ran as fast as I could, because there is something that I've noticed, and I've never seen research on this. But usually, if you're picking up an idea as an entrepreneur, and you really are energized by it, you know it's a large potential and let's say you've even figured out a way to win in that space, someone else has that exact same idea. They have that idea. And then it becomes who can execute better and who can raise the most money. And sure enough, I just ran as hard as I could, as fast as I could, and then three other companies in the resale space for funding very close to when I was. None directly in my positioning, but it was fascinating because there was something in the air that all these different entrepreneurs were channeling. So The RealReal stood alone in its focus on luxury. But Poshmark got funded, ThreadUp got funded. It was a pivot from a baby-sharing site, but they got funded as a resale business. And then a company that quickly flamed out there were two that flamed out. One was Threadflip that got funded, but it didn't last even a year or maybe it lasted a year and a bit. And another one who I can't remember, but I remember their premise was ‘Everyone wants to be a star, so sell your own closet we’ll make you a star’ and I remember – anyway, doesn't matter what I thought. But all I'm saying is it was out in the ether. And that's something that's sort of magical. You hear other entrepreneurs talk like that, it's true. Once you channel something down, and then you run your numbers, my bet is somebody else's thinking that way. And then the other thing people always tell you, which I think is fun, they're like, ‘Oh, I thought of that idea.’ I'm like, ‘Okay, but did you do it?’ Because that's the definition of an entrepreneur. They think of it, they size the opportunity and then they do it. They don't just stop at thinking.

Adam: Julie I love that. I've interviewed so many of the most successful entrepreneurs in America and I've heard the same thing over and over and over again. It's not the idea. It's the execution. I did an interview with Wes Schroll, founder and CEO of multibillion-dollar business, leader in the reward space, you know Fetch. 

Julie: Yeah, of course, of course.

Adam: And something that Wes shared, which I thought was great. It took him a few days, maybe a week, to come up with the idea, and fully flesh out what Fetch would be all about. And ever since then it's been execution. And what he said to me, what he said to listeners is, ‘If you love coming up with ideas, that doesn't make you an entrepreneur, because the real work is once you have the idea, that's where you have to really put the time in. And if you don't like doing that, you're in the wrong game.’

Julie: Oh, believe me, it is hard work. No one goes from zero to a billion or even 10 million, without a lot of hard work. And it's long hours. I used to in fact, I tell people, used to fall asleep. I used to work, come home, work again, fall asleep sometimes at my breakfast counter, and I wake up with stuff stuck on my face, been there all night, my back hurt, everybody was mad at me at my house, including my dogs. And it was just all bad. But it was all great. It's all great. It is about the execution. And entrepreneurs sometimes get caught up in the preciousness of their idea. And it's like, these are people that have never done anything, you know. Like, oh, I don't want to share my idea. And I'm like, fine, but what are you going to do about it? Your idea isn't worth any money. It's just not, it's what you do with it?

Adam: Can you break down the keys to growing and scaling The RealReal? And what do you believe are the keys to growing and scaling any business?

Julie: Well, I think this is very generic, but I think it applies, you have to look at what is your hierarchy of business. So what's going to move the needle? And you have to focus on that first. And you're always testing is this what is the given business to consumer? Does it matter? Are people actually signing up for this? Do they want to do it? So with The RealReal, the focus was always about getting supply. So when you look at, let's say, the first $10 million that came in, about 7 million went into how do I get my supply, because I believed and it's more true than not, that any of the luxury brands have phenomenal demand. But if I don't have the product, and it doesn't matter, so instead of putting all the money in at the beginning of building this phenomenal tech platform, which some people did, but then they ran out of money, like they said, ‘Oh, I'm gonna build this platform and hire tons of engineers and 5 million into it, they don't have a business. Why is that?’ And that's because they didn't focus on the right thing. So with luxury consignment, it really was about getting in the product. And that's where the focus was. Then, after a while, we got the methods going and a predictable methodology, then you build the infrastructure underneath it to support that. And in the meantime, the other thing I think, is really critical, especially if you're raising capital, you've got about nine months after you take your first dollar, and you launch to actually show results and show traction. And if you're not, you better have a good pivot plan enforced. So you've always got a set milestones out, that actually will say, ‘Okay, we did this, we got that’. And so you can show because you're most likely going to have to raise money again. So you have to be conscious of the milestones you need to hit. You have to make hard choices. You have to live with less than perfection, always. But you have to again, it's always focus on the high-order bet and that is really hard for some people, but it's a killer if you don't.

Adam: Julie, when I asked you about the formation of The RealReal, how it came together, why it came together, something you said was, it came together because it had to, I didn't have the kinds of opportunities that I wanted. So I had to create my own opportunity. And one of the reasons why was your previous experience as CEO of Pets.com. And for listeners who might not know Pets.com, a company that became iconic for the wrong reason is synonymous with the Dot-com bust, and it went bust in a really bad time for you personally as well. It went under the same day that your marriage went under. Your husband asked you for a divorce, terrible timing in your life, everyone goes through hard times in their life. But this was a hard time your business is down, your marriage is down, your reputation is down. How are you able to navigate that grueling period? What did you learn from that experience that's applicable to anyone listening? And what advice do you have, for anyone on how they can navigate the challenges, obstacles, and failures in their careers and in their lives?

Julie: I would say, when your world falls apart like that, you have to get back to what's important to you, what you know feeds your soul. If you need therapy, you need to get therapy. If you need a creative outlet, you have to figure out what you need in your life to keep yourself stable. And then, and it takes time. I mean, everybody goes through it, you can't live without tragedy. So it takes time. I happen to personally find art feeds my soul, and being around creative people feeds my soul, which I'm sure it goes back to when I was raised by artists. That kind of creativity and energy is positive. On the career side, one of the weird benefits, which I didn't realize, until I started The RealReal because I was always the CEO-to-hire up until then, is that I didn't have any fear at all. And I thought, well if it fails, it fails. And that was a gift that I couldn't have predicted. So that gift meant that taking the risk with the fear of another failure, and maybe getting written up by the press again as negative, I didn't care. Didn't matter to me at all. And I didn't know that I had evolved that way until I started. And that was a gift. I think when you go through something bad, you can either get strengthened by it and realize that ‘Okay, I've lived through it, I'm fine,’ or you can let it destroy you. And I think everyone says it's not the failure. It's not the tragedy. It's what you do next. And that choice is uniquely individual. And it's not easy. I'm not trying to say it's easy, and it was easy for me every day. But I think you always have choices in life. And how you approach tragedy and adversity depends on what happens next in your life. And it's not linear, you don't have to, like, you know, pop up and go up, ‘That just failed. That's great. I'm ready.’ But ultimately, you do make choices that have impacted your life, and you have to be cognizant of it.

Adam: I love it. Julie, you spent the bulk of your career as a female leader in the male-dominated world of technology. What advice do you have for women in male-dominated fields? And what advice do you have for men in those fields on how to become better allies?

Julie: Well, first of all, I don't think women should focus on the discrimination, both in funding (because women entrepreneurs get less than 3% of our funding), and day-to-day activities are there but you can't focus on that. Well, you have to focus on what your goals are, and how to get there. And I think when you ask about what men can do, really to create as much as you can a meritocracy. Really look at what people do, and try to strip gender, any gender, and race, out of the equation. And there's tools that can help do that now. I can tell you, even at The RealReal before salaries went out, we had to make adjustments because there's inherent bias in everyone. And we were always comparing same job to same job and making sure regardless of who was doing it, were they getting equal pay, and women were still… we had to just more women at The RealReal, which shows you how deep the bias is. It's not conscious, there's an unconscious bias. So I would say men and women both try to create a meritocracy. Look at the data, make sure you're getting equal pay for equal work. And for women just keep going because it's really worth it. It's worth driving your own car. It's worth making your own decisions. The freedom you have by having your own money is remarkable. You're gonna make decisions for the right reasons, and not for reasons that would actually subordinate your own personal being.

Adam: Julie, what can anyone listening to this conversation do to become more successful personally and professionally?

Julie: I would say be true to yourself. I do think working hard is actually still important. There's been a lot written about the lazy workers. If they want to do that. That's fine, but then if you really want to be successful, you're gonna have to put in the time. Recognize it's not linear. Recognize it's a long game and believe in yourself and surround yourself with good people, and then just make it happen. The best people I know that are entrepreneurs, they just keep making that happen and they don't make excuses. Then they move forward recognizing whatever knowledge they can get from the back, but they don't spend their time focusing backwards. They spend their time going forward. That sounds very trite. I hope it's not really meant to be, but it sounds a little trite as it's coming out of my mouth.

Adam: I don't think it is at all. Always move forward. I did an interview with General Gus Perna, retired Four Star General, who led Operation Warp Speed. And when I asked him that question, he shared a story. And the takeaway from the story was, no matter what direction you go in, you can move this way you can move that way. Just move forward. All that matters is that you're moving forward. And that's your message. And I think it's a really important message.

Julie: It's hard to do it sometimes, you know, but you got to. Here's the other thing, and this is another good tip for an entrepreneur, if you're not decisive, you will fail. You have to be decisive when all the facts aren't there. I know I talked about the importance of data. And that's really important for an ongoing company. But when you're starting a business, you're going to have to be decisive in the absence of facts. And you might be wrong, but making no decision is the worst. So you make a decision, and then you course correct. So decisiveness is actually the hallmark of an entrepreneur also.

Adam: And the two tips go hand in hand. Make a decision, and go forward. Just do it. Take action.

Julie: That's right. I know. You sound like Nike now. But that’s right. Just do it.

Adam: Julie, thank you for all the great advice and thank you for being a part of Thirty Minute Mentors. 

Julie: Oh, sure. Adam, thanks so much.


Adam Mendler is an entrepreneur, writer, speaker, educator, and nationally-recognized authority on leadership. Adam is the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal-winning athletes, political and military leaders - for intimate half-hour conversations each week. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities, and non-profit organizations. Adam has written extensively on leadership and related topics, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. Adam teaches graduate-level courses on leadership at UCLA and is an advisor to numerous companies and leaders. A Los Angeles native, Adam is a lifelong Angels fan and an avid backgammon player.

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