Before David Goldberg launched Fresh Neck back in 2012, I was skeptical. The pitch was “Netflix for ties,” and he was one of a small handful of start-ups doing it. There were lots of questions, but the most important one was simply: will guys pay a monthly fee to rent ties?The answer, a little more than a year after his launch, is yes. Goldberg has more than 500 paying customers and began turning a profit last fall. They have ties, pocket squares, cufflinks, tie bars and other accessories in their inventory from modestly priced to luxury. Over the last year Goldberg has managed to secure some valuable wholesale relationships with small and emerging neckwear brands like Armstrong & Wilson that see Fresh Neck as a marketing tool. And he’s established some partnerships with custom clothing sellers like the e-commerce retailer Black Lapel.
Fresh Neck customers sign up for one of three basic monthly plans. For $20, $35 or $55 a month, they get to select three items (ties, pocket squares, cufflinks, tie bars, suspenders and lapel flowers) to be mailed out at a time and one to reserve. The three levels of membership are based on the brand selection. For example, the Silver level has ties from Ben Sherman, Calvin Klein and Brooks Brothers, among many others. Gold has all from the Silver level plus more, including Burberry, Ike Behar and Ralph Lauren. Platinum includes the two previous levels along with brands like Brioni, Prada and Zegna. Every item is available for purchase on a sliding scale based on retail price and how long it’s been in rotation. Customers can keep items as long as they like, and then return them in pre-paid envelopes. The items are then either spot cleaned or fully dry cleaned.
Goldberg was friendly with the guys who started a rival business, Tie Try. They all talked shop, figuring both start-ups were getting into something new. The founders of Tie Try were two lawyers from Alabama, David Powers and Scott Tindel. In November last year, the pair appeared on ABC’s Shark Tank, the show where entrepreneurs present their ideas to a panel of celebrity investors for a stake in their business. Powers and Tindel asked for $100,000 investment for a 25 percent stake in Tie Try. Problem was, they were still small—only around 100 customers—and they weren’t passionate enough about the product or fashion in general. That exposure gave them a boost in subscribers but that actually hurt them: they couldn’t keep up with demand. So they made a deal with Fresh Neck, which bought them out.
The other major player in this admittedly small market of tie rentals is Tie Society, perhaps the first to launch (late 2011). Washington, D.C.-based Tie Society has a similar model but bases its monthly pricing on the number of items members can have out at a time (for instance, one item is $10.95 per month and three items are $19.95 per month).
Is there a future for this business model? Fresh Neck and Tie Society have shown there’s interest from consumers but can they scale up enough to stay profitable and grow? What is certain is that there are young men out there with an interest in men’s fashion that exceeds their budgets—at least for now: the guy who rents a Brioni tie today may be buying one in a few years.
A shorter version of this story appeared in the January 2014 issue of MR.