Nasty Gal is expected to file for bankruptcy

For people saying business books are all nonsense -- why is business seen as a uniquely luck-based activity? No-one says, oh, some bridges collapse and some don't, so books about civil engineering only reflect survivorship bias. Business can't be reduced to a formula, but it can be broken down into smaller areas, each with its own principles (sales, marketing, recruiting, product development, etc). Amuroso learned these areas very quickly when she was getting started, but made some mistakes when things got bigger and the challenges increased.

For real about unnecessary dismissive hate, I'm a female Engineer and loved her stuff, and for the people on here incredulous about the investment scale for this clothing store, you are seriously underestimating the proportion of ones paycheck or overall wealth a female with a decent salary like me (26yr old female working in tech) but also girls who don't make very much like coffee baristas or artists, spend on clothing, and being fashionable, however they define that for themselves.

Whether you agree its rational spending or not, the spending happens, and this is not an example of sexism, just an example of sometimes how clueless men can be about the time money and effort women put into their looks. I say that accepting as usual that me as a female am a minority in the HN community, so I try to provide gender perspective when its relevant.

That aside, even if fashion and makeup is of no interest, being a female costs more than being a male when it comes to basic clothing and hygeine. That is pretty undisputed.

For the men on this thread who may not have been there for the cult fashion launch that liberal awesome women really identified with and particularly nerdy female engineers I knew, as we were always the ones on the internet and finding new launched stuff that was not yet mainstream, in my opinion there were two major things, and both of those were fueled by VC firms funding it making decisions on Sophia's behalf that in my opinion were subpar, and also I'm saying this because I've read dispositions of her first female employees and have their perspective as well.

The big downfall was she Sophia was supposedly aggressive with her own female employees. That is all a matter of perspective from her employees and who knows the real story but one thing goes undisputed, the integrity of her teams spirit and unification went down the drain years back. Thats never a good sign for anyone, regardless of whose fault it was.

Secondly, The second the Male VC firms put the Macy's old Fashion Director in charge of revamping the clothing choices, I could immediately tell, and did not like it, and neither did Sophias best weapon in her company, her tight knit core of awesome scene girls who vigorously curated the clothing line into something awesome and unique.

Sophia had a magical ability to be at the racy edge of fashion while maintaining a classic California Vintage Style and pulled it off as a badass look that never came across as cheap or slutty. Her pieces did not look like something you bought online. They looked like you really did find that one amazing once in a lifetime impulse buy that was a buried treasure in a vintage fashion store in Oakland. Her pieces were original but echoed some classic badass and also classy shapes and ideas.

Fashion like this has its beauty in the FACT that it walks a very very very fine line without crossing it, and all that went down the drain when the business plan was modeled to cater to the masses and not the cult following.

Even early on female employees who did not like Sophia agreed that the input from the previous Macys Director was crap, and they should have never put her wannabe 80's common girl attempting to be badass and failing miserably and looking cheap and slutty input into the line, because it was obvious in the output of the clothing curation.

Sophia's magic was her own style, and finding other girls my age who genuinely emulated that style, and letting them do the curation. Bringing on a multimillion dollar chain store for 5th Ave Fashionistas was the worst idea ever.

Nastygal was like shopping with Scene girls in Oakland helping you pick out your clothes. Now It's like some lady 3x my age in stilettos prototyping my "stereotype" and picking out economy scale pieces and being dressed by my mom. Not only did the Macy's employees brought on just "not get it" in the first place, they really bypassed the input of the girls doing the original curation, and those girls spoke out about it alot.

If none of this makes sense about fashion sense, what should make sense to you is that the product components were mistaken as the input from a bigger better company when it really should have been the financial components of Macys as a target using good financial models they have made around clothing, and not trying to actually use the same type of curation.

It's very simple at the end of the day. They stopped listening to their customers, and the main curator was imported from a Brand that could not be further from the personality of her dedicated customers.

For men, I can only relate to you this concept as what it was like (I'm 26 so got FB two years before college when you had to be invited by a college student with a college email ID) to go from the awesome FB phase to the point when your parents and grandparents were allowed on facebook and suddenly started commenting on everything you like and posting pyramid schemes for tupperware sales. The party loses its edge quick. (Maybe some of you cannot relate, but for me, I have been off of FB for over three years).

Once you lose your cult following, your brand and the critical brand honement and feedback spirals out of control.

Nastygal was one of my favorite places to get a statement piece here and there when I wanted to be fun, but as a nerdy girl I'm not daring enough to pull it off without botching it, and Nastygal was always there to help me make a classy but original and slightly daring jump.

I havnt bought clothing from there in years. There are a million online female clothing stores that mimic nastygals brand now, and because theyve lost their uniqueness, there is not much to differentiate them from the rest.

Delusionally reductive to use rate of inflation to estimate the capital and labor costs associated with bringing the product to today's market.

There's many other approaches to build a big business though. While Apple's workers and investors believed in Apple's approach, Nasty Gal's workers and investors believed in Nasty Gal's approach. Capitalism is the judge and redistributes capital to the approach that works.

Apple's workers and investors now have more capital, so they can start more hardware tech companies, while Nasty Gal's workers and investors have less capital, so they can start fewer online clothing store companies. It's inefficient, but it works out in the end.

Go read the article and read up on them: they only took on VC funding later when they had a solid business that had been built from scratch and was beyond the Apple II era of its existence.

This wasn't a case of somebody just having the idea to sell clothes online and then heading to VCs: it was a business that started out well, took on VC funding, and then started to tank.

Your comparison is unfair to both Apple and Nasty Gal.

And given the competition for the market back then, you can probably presume that 60 of those 65 investments would have failed.

This is pretty much the norm for business books. This time it just isn't backed by survivorship bias.

Oh dear... I can get bringing in too much stock, It is understandable as a new young company that you overestimate sales of some items but not working with size curves is just plain unprofessional.