Interview: Arun Gupta from Grailed
Five years ago, Grailed was Arun's pet project that he made himself to elevate the experience of shopping second-hand men's clothing. Present day, Grailed is one of the most established, successful, and unique ecommerce sites that pushed the boundaries of menswear culture as much the culture populated the website. With iconic projects like Grailed 100, Grailed Holiday Archive Giveaway, and Dry Clean Only (their excellent editorials), Grailed became synonymous with streetwear and high fashion. We interviewed Arun in the Grailed office in SoHo.
Arun, you went to Yale, how were you like as an undergraduate student? Did you always have the entrepreneurship spirit with you?
I think that a common theme among entrepreneurs is that they don’t really know what they want to do until they end up doing it. For example, the guy who created the first spreadsheets was a radio DJ in Boston before he programmed the first spreadsheet software. But you know, a lot of people turn and twist and end up where they are. Personally, I’ve always had an interest in doing something on my own. I have older brothers and sisters who are in banking and consulting, and I didn’t want to go on that route. I wanted to do something different. I had eBay arbitrage businesses in high school like a lot of kids. So I guess you could say that I had an entrepreneurial bug for a while!
That’s very interesting. Something a lot of people don’t know about you is that you were in the Y Combinator program with your company WakeMate. It’s a very prestigious start up incubator that presents unique opportunities. How was that experience?
It was awesome, honestly. Y Combinator is amazing. The program back in 2009 was very different than the program they are running today. Y Comb[inator] in 2009 was for a lot of college kids who were trying to do something but didn’t know what to do. Now, I think it’s more for more established companies who are more familiar with entrepreneurship. The companies are more further along when they get accepted into the program. For me, I actually had the entrepreneurial bug back in sophomore year of college. With a friend from high school, I started this WakeMate company that made wristbands that you wear while you sleep. It tracks your sleep cycles, checks when you wake up, connects to your phone via Bluetooth. So we were working on that while we were in college. Then, in the middle of our junior year, we were like “Look, if we want to make a good run of this, we can’t do it while we’re in college.” So we decided to drop out in the middle of our junior year. So in the spring semester of 2009, I was dropped out officially. We were trying to figure out how to make this thing work, how to build hardware products, and actually program the bracelet. I was talking to a bunch of software engineers, computer programmers, and we also applied to Y Combinator. It was a long shot. I never thought that we would get in. They ended up interviewing us, we flew out to California, and they accepted us into the program, which was amazing. Paul Graham is a hero of mine. I used to think “This guy knows exactly what he’s doing, his essays are amazing, he’s brilliant.” So it was really epic. From an education standpoint, I couldn’t have asked for anything better. The company WakeMate itself was… a good idea, but it was kind of flawed, and I could get into why the company wasn’t interesting later. But it was just really difficult to make that company massively successful. But as an educational project, trying to make this thing work, figuring out how to build a team, figuring out how to raise funds, figuring out how to market a product, figuring out how to do customer support, all that stuff, it was amazing. It was like going to graduate school and doing a startup. They would teach us how to talk do venture capitalists, be there for advice 24/7, and all that. So even though WakeMate wasn’t super successful, we ended up raising about a million dollars in financing. We produced 10,000 of these units and sold them all, which was great. So we basically made all the money back that was invested. But never really much more than that. Even though it wasn’t super successful, it was an AMAZING learning experience. Then, coming back again the second and founding Grailed, I was able to avoid a lot of mistakes and pitfalls in business thanks to these experiences.
This is more of a personal question, but I dare to ask. I would say that WakeMate was a less successful company than Grailed, how was the time interval between the end of WakeMate and the start of Grailed? People love to say “To be a successful entrepreneur, you have to get hit once and bounce back twice”, but in reality it’s not that easy.
It’s really not. Getting back on the horse is REALLY tough to do. Especially when people are not thrilled with your last project. I think one of the hardest conversations I’ve had in my life was calling up all our investors in WakeMate and saying “Hey, I’m gonna shut this company down, we’re running out of money, it’s not going super well, I don’t really have a plan to get us to the future, so I know you invested $50,000 in my idea, and thank you so much for believing in me, but now that $50,000 is worth $0.” It’s really difficult to do. Not only does it take a toll on your relationships with people, but it also takes a toll on yourself, internally. When you’re doing a startup, there’s always ups and downs. When things are going great, I’m amazing. When things are going poorly, I’m terrible. When things finally end, and you reach that finality, you go “Well, there it is. It’s decided. I’m terrible. Fuck this. I don’t know what to do.” But you know, the feeling wears off, and you kind of understand and reflect. It comes down to something inside you. Do you want to give it another shot? Or do you not? My old co-founder, I don’t want to speak for him, I don’t really know how he feels, but he got a regular job. He works for another company. I wanted to give it another shot, but the interim period of two years was difficult. I went back and finished my degree, which was fun. But after I just shut down the company, it was really difficult to do anything. Those three, six months, after WakeMate, I was like “Well, fuck.” My self-worth took a beating. But after that, I came back and thought “I did a lot of great stuff. I accomplished a lot, raising a million dollars. Making 10,000 physical units of our product, that’s not something easy to do. I added a lot of value and want to do something similar in the future.” So you know, it’s almost like the failure gave me the confidence to try again. But there was an initial mourning period that was inevitable. It was tough. It hurt. I didn’t know if people still liked me, people I knew in Silicon Valley. I didn’t know if investors still respected me. I didn’t know if they were thinking “You failed. Nobody cares about you.” But the reality is, if you want to give it another shot, and you have talent there, and you are good at what you do, you give it another shot. Entrepreneurship is like a meritocracy. If you’re good, you can do good things. People will believe in you, people will respect you. If you can make money, ethically, people will respect and believe you no matter what your previous failures are.
I still remember when Grailed first popped up. I remember the Reddit post on /r/streetwear. Back then, to be honest, I thought “Hey, it’s like eBay. It’s not going to make it. There’s no way. This won’t go far.” Two, three years later, look at where we are. Did you always have a vision for Grailed, or was it a blessing born from an accident?
You know, that’s a really great question. When you see a new website pop up from an individual person, why would you think that it will be successful? They don’t have the resources, they don’t have this and that. The default assumption is that they’re going to fail. I think the reason why Grailed was so successful comes back to my vision. When I made it, I remember thinking that this is really important. I saw what it could be, how great it could be. I think without seeing that vision, it’s impossible to lift yourself up and make it happen. What are you working for, if you don’t have something you’re working towards? I didn’t envision this office right now, but I did envision more people using the site, what value it would provide to those people, how the website could be better. I think having those guiding principles and vision to motivate you and to dictate the strategy and path you execute upon, is really really important. Without that, you have nothing. You aren’t grounded. That’s why we see so many companies pop up and disappear.
I’m a comp-sci major, so I had to ask this question. From what I know, you didn’t get a degree in comp-sci. On paper, you have no coding background. But the very first prototype of the site was coded by yourself. Were there any massive technical difficulties? I can imagine all these technical mountains to climb over for Grailed.
You’re right. I had no coding background, I was a physics major. But the reason why I was so determined to build the site myself goes back to WakeMate. From a technical standpoint, WakeMate was much more difficult than Grailed. You had phone software that worked on iOS, Android, and Blackberry. You had the website and the server. Front-end and back-end. You also had the hardware engineering of the wristband. You also had to program the wristband. C code, Django, Python, Objective C, Java, the list goes on. But I was not technical at all. I can remember this one instance very vividly when the servers crashed. I was like “Hey, can we point our domain to the Twitter page so people know what’s going on?” And the head engineer was like “No. That’s way too complicated, that’ll take a week to get done.” I thought “That doesn’t sound right, it sounds like it should be possible to do, in less than a week, but I can’t refute what you’re saying, because I don’t know how to do it.” And at that moment, I was like “Fuck it. If I’m going to do another website, I’m going to know how to build it entirely myself, and I’m not going to rely on other people.” So after WakeMate was done, and I went back to school, I spent a lot of my free time trying to teach myself how to code. I knew a lot of friends who were programmers. I made this website where you could log in with Facebook and it would import all your Facebook photos, and you could drag and drop photos as well, and you could basically photoshop them in your web browser. You could airbrush them, add stickers, change filters, and other shit. Then, you could mail it as a postcard. I basically used that as my learning project. But I think that right now, or even four five years ago when I was making Grailed, the process really became easier. You have Heroku, Ruby on Rails, you have all these gems like Devise and Mailboxer, and all these plugins that you can cobble together. “I’m going to use Devise for user authentication. I’m going to use Algolia for searching, I’m going to use Heroku to deploy.” Basically I was just reading documentations and just cobbling stuff together. And yes, stuff definitely broke. It was hard, but it wasn’t impossible. At one point I remember I had this memory leak in the application so it crashed every six hours randomly, basically every day. So I was just checking the website every ten minutes. Every time it would crash I would just Heroku restart the entire app and the site would come back up. That was a huge problem. It’s not a problem that our current engineering team would live with, but I lived with that problem as I tried to chase down this memory leak for like months. The site would go down, I would put it back up. And that sucked. But I could deal with it, and it was fine. The site traffic was so small back then too. Now, if we go down for ten minutes, people are like “What the fuck?” and there are a million Twitter messages. “I hate your website, and I hate you because the website is down.” Back then, if the site went down for an hour, nobody would really notice. It wasn’t really a big deal. So yes, there were huge technical difficulties but you can really solve around them. People also know how to solve them. So if I needed to, I could have Googled it, asked in forums, asked friends, or somebody who can fix my problems. I’ll say one more thing. Biggest issues come in when you scale. More and more traffic is really the biggest issue. So, a nice thing to do is to tie the amount of money you make to the traffic that you’re getting. If you’re getting more traffic, you can get more money, and you can use those resources to solve problems that come with scaling.
Right. That’s a gem right there! I would say that Grailed is still a tight-knit, startup-esque company with small amount of employees. I can imagine how hard it is to go from a one man show to having a co-founder, CFO, CTO, and other employees. You have to put a lot of trust in them. How was your first hiring processes? Did you just know people?
No, actually. Maybe this will be comforting for some people. I didn’t know very many people at all. Even in college and in general, I was always a little bit of a loner, not like explicitly so, but I wasn’t one of those people who network a lot or knows a ton of people. I couldn’t say “Oh yea, I know a guy who could do this, a guy who could do that!” I was always in the mindset that if you build it, and it’s successful, people will come to you. Maybe that’s not the best way to think about things, but it’s kind of true. The way that I found my two co-founders was through Grailed. Grailed was up for about six months, and Jacob Metzger, one of my co-founders, emailed me at firstname.lastname@example.org. He basically said “Hey, whoever this is, this site is amazing, I love it, if I could program, I would have made this site too. Let’s meet up and talk.” A lot of people sent me messages, but his stood out. So there’s a reason that I actually met up with him. He was a user, so we just talked about fashion, clothes, business, what we want to do, what our vision is, and all that. We spent like four months doing that. Just connecting. He was looking to leave his job and do something else, and I was like “Hey man, it would be stupid if you didn’t come work with me. We should do this. I’ll have to raise a bit of money to pay you because everyone needs to live and eat.” So I did that. The way that I found my other co-founder, our CTO Julian, is through Venmo. He worked there. We met through mutual friends, and he was also a user of the site. He was like “Yea, I bought a Rick [Owens] tee couple weeks ago, I got it, it’s amazing.” I was like “Holy fuck, you actually use the site and it works for you? That’s awesome!” He was like “Yea, I love Rick Owens, I love all these brands, love designer shit, love Grailed.” We just really clicked. If you build a company that has an emotional attachment to its users, and its users are people who are… real people, who are doing cool stuff of their own, it’s a little bit more helpful to get people to work with you. Davil was a user of the site. Scott was a user of the site. Lawrence was a user of the site.
Wow. I did not know that. I would say that every entrepreneur goes through the rollercoaster ride of ups and downs. It gets really tough. Were there any memorable moments when you felt like you were at the low bottom?
That’s a good question, honestly. There definitely are a lot of ups and downs, and if I had to give advice on it, try not to let them get to you so much. Obviously, the downs are overwhelming. Everything sucks, it’s terrible. But the ups are overwhelming as well. Everything is amazing, it’s all you can think about. I almost try to mute the ups and downs, and just be more rational about it. But it’s impossible advice to follow, so I can give that in good conscience. Back to the question of was there a moment where we felt like we hit the bottom… not really. I’m a little bit emotional, so I tend to blow things out of proportion. I would say that one of the two biggest points we had where I questioned things the most was when we started charging fees. But even that went really smoothly. People always knew that we had to start charging fees, eventually. It wasn’t a huge shock to people. You know… nothing. Nothing’s been so crazy that I was like “Things are over.” If you saw this last month, everybody had to upgrade to a Paypal business account. There were some payment hold issues we were having, there was a lot of negative PR around that. The amount of people using the website never stops. Even if people are trashing us on Reddit, or wherever, the numbers are still strong, and the usage is still positive. The website really does provide a lot of value to a lot of people. They feel really great about it, they like seeing it every day, they just feel such an emotional connection with the site. They want to buy stuff for cheap! I want to buy stuff for cheap, that’s why I started the website. It’s hard to mess with that. We try really hard. We try to plan for every eventuality. We keep the user first, and it’s worked out well so far.
It’s really an exciting time to be Grailed. You guys did the Grailed 100, the Holiday giveaway, and Dry Clean Only with all these nice, well-edited articles. You know, Farfetch has an editorial. Mr. Porter has an editorial. SSENSE has an editorial. But Grailed has interviews and articles with niche group of people that only “fashion heads” would know, like Jerry Lorenzo and Jacob Keller. Because of these adjunct functions of Grailed, I personally see it as a lifestyle brand, more than just an ecommerce platform.
Yea, completely. And that’s the goal, really. Grailed was never about buying clothes, I mean obviously, to us, it is. But if you care about clothes, if you’re into clothes, as a guy, this is the site for you. In all aspects. Clothing is one part of that, because the hobby is obviously very commerce-centric. The idea of Grailed 100 was to get more people to the website. How are we going to get more people to the website? Well, let’s just do a massive event that people can’t ignore. Grailed 100 is nice because it’s Grailed in a nutshell. It’s a very concentrated version of what Grailed is. Cool clothes, across a variety of themes, in a price that you can afford. So the Grailed 100 pieces are clothes are we picked, with artificially lowered prices. It’s almost an exhibit art, a microcosm of what Grailed is. It shows the taste level of the company. So, the pieces that we pick, the editorials we write all show the taste level of Grailed. Grailed is more than just eBay. We have our own point of view, we have our own vision, and this is what we stand for. This is what we think is cool. Dry Clean Only is about education, really. People come in, saying “Why do Rick Owens sneakers cost $600?” “Why would you ever buy a pair of Geobaskets?” “What are Dunks?” “Why is Margiela cool?” “What do the four stitches on the back mean?” You know? The point of Dry Clean Only is to really educate people about this stuff. The more context you have around the clothes, the cooler that you think it is. The nice thing about Dry Clean Only is that we aren’t beholden to advertisers. Even selling things, really. Mr. Porter is trying to sell what they have in stock, that season. It’s understandable, and it’s good stuff, so it makes sense. But for us, we don’t even care what we sell. It’s a neat thing, like a magazine, with a large budget, but we don’t need to bring in any revenue. It’s all cost, no revenue. We can have total creative control over it. It becomes an unique voice, an unique position that we can enjoy. But we’re definitely leaning towards the more social aspects of the site. We’re trying to make profiles more social, you can follow people now, more discussion on the website, what is everybody wearing today, stuff like that. All in the works for next year.
I would say that Grailed has evolved with the menswear culture. People think that Grailed is just a byproduct of the evolving menswear culture, but I really think that Grailed itself has evolved the culture. I remember two, three years ago, people didn’t know what Ann Demeulemeester was, people didn’t know what Visvim was. Now, high fashion is becoming much more organic and natural. I would love to hear your opinions on the current landscape.
I think at the end of the day, fashion is about expressing yourself on the outside and inside. This is who I am, this is what I represent, this is my aesthetic, I think all those are super important. I think that fashion is just becoming more mainstream. It goes back really far. The Jordan stuff that was happening in the 90’s, the metrosexual stuff that was happening in the early 2000’s, going from loose fitting clothes to tight fitting clothes, rappers wearing fashion, celebrities wearing more fashion, and it’s just getting more and more prevalent. Streetwear is exploding onto the scene. Everyone knows it. Supreme is massive, Balenciaga is big, Vetements is big, Gucci is huge now, Hedi [Slimane]’s Saint Laurent stuff was huge, and all this stuff is really coalescing and increasing the amount of money spent on fashion. People are paying more attention. I think it’s awesome. You’re right, it’s hard to say if Grailed rode that wave or helped propel it forward, but it’s very fortuitous that people care. It’s art, really. Art for the masses.
As we get to the end of the interview, I would like to know more about Arun the person. Who are your personal heroes, whether it’s entrepreneurship, fashion, or business?
If I had to pick one person, it would have to be Paul Graham. He’s like… I don’t want to be too cheesy, but he’s like a modern philosopher. If you read his essays on his website, he has a lot of theories, hypotheses, how the world works, how commerce works, all kinds of stuff. I really, really respect him. Even more so after I got the chance to spend time with him. I think it’s a shame that he’s no longer at Y Combinator. I think Y Combinator would be a better place if he was involved. Anyways, other than him, there’s a lot of people I respect. Steve Jobs, of course. I think he really was a dick, but I respect his product sensibilities, and I respect his demeanor, or his personality. I also look up to Jeff Bezos for he was able to build, but I don’t respect his treatment of other businesses in the competitive landscape. Amazon is notoriously anti-competitive, and they don’t treat their employees super well in other areas too. They really do squeeze every bit out of everybody. Paul Graham’s someone I respect a lot, but everybody else… you know… you take the good and the bad. It’s hard. It’s hard to pick idols. You never really want to meet your idols, dude. They’re all just people. It’s more like what they represent to you than it is who they are. But Paul Graham didn’t really disappoint. [laughs]
This is the customary last question that we always ask our interviewees. If there’s one gem that you could leave to other NYU undergraduate students, whether they want to be an entrepreneur, or even you, what would it be?
Damn, I go back and forth on this. [laughs] It’s some combination of believing in yourself, and doing what you want. One thing that I think is not helpful is when people go “Okay, I saw that you did X, Y, and Z, how can I do X, Y, Z?” “How can I build a website like Grailed?” I think that if you have to ask the question, you’re already hurting yourself. I didn’t know how to build Grailed when I built Grailed. I just Googled it. Literally. “How do I build a website where I can do this.” There’s so much knowledge on the internet, that you can figure anything out if you read about it. Some combination of believing yourself and making it happen. You know, I was just a kid. Yes, I came from a privileged background. I was able to go to Yale, and I was able to work on this website in my free time. I’m not discounting any of that. Use the resources you have, and try to do what you can. I don’t know, this is bad advice. [laughs] We’re living in this great age. Ten years ago, you couldn’t just make a website like that. You had to spend like $50,000 renting servers and computers. Putting shit up, maintaining it, database administration, server administration, all these really fucking complicated things. Now we have Heroku, we this, we have that, we have all this shit. You can do whatever you want. Recognize your own power. Propel yourself, empower yourself. What do you believe in strongly? What do you think is really important? What do you want to do for yourself? You should trust yourself. If you think you can do it, if you think you can make it happen, fucking go for it man! I never doubted myself for a second. Actually, that’s not true. [laughs] I thought, “I can get all this together, I can make this happen, I can actually provide value.” I was right, for the most part. Not that I did this all by myself, I didn’t, but I was right that I could make this happen. Anybody can. I’m not super smart or special. I’m just a fucking guy. You can do it, anybody can do it. The internet is fucking magical. You can do anything on the Internet. So I did.
This article was originally published on NYU Fashion Business Association.
Thumbnail source: New York Times / GQ