Trina Spear - Billion Dollar Scrubs

Key Takeaways

• Trina Spear, CEO of FIGS, believes that the best business ideas are often simple and obvious.
• The original insight for FIGS came from Heather Hasson, Trina's co-founder, who noticed a gap in the market for scrubs worn by healthcare professionals. The scrubs were baggy, boxy and had the size written on the back of the neck. The shopping experience was also poor.
• Heather decided to take her friend's scrubs, focus on the fit and tailoring and started getting requests from other healthcare professionals.
• FIGS was the first company to go online and sell directly to healthcare professionals, and the first vertically integrated company that did both manufacturing and selling.
• Trina believes that the reason no one had tackled this opportunity before was because there were companies that made medical apparel, companies that made scrubs, and companies that sold it, but no company that did both.
• Trina explains that the traditional financial model of an apparel retailer was such that they were giving away a large percentage of their profitability to the retailer and license holder, leaving little room to innovate the product or invest in marketing and community building.
• FIGS, on the other hand, has a different financial model, where they sell directly to consumers and own the entire chain of events from yarn level to customer delivery, which allows them to infuse margin dollars in the product as well as in marketing and community building.
• FIGS achieved this by vertical integration and manufacturing their own products, which resulted in over 70% product margins.
• In the early days, FIGS used a scrappy approach to finance the business, partnering with manufacturers who believed in them and raising a $2 million seed round.
• Trina believes that it's a misconception that starting a business is expensive and encourages entrepreneurs to find ways to do things themselves, rather than outsourcing everything.
• Trina believes that the key foundation of FIGS was getting the fabric right, which took them a while to achieve. No other company has been able to replicate it.
• Another important foundation was the ability to communicate and connect with the healthcare professional community in a nuanced and authentic way, treating them as human beings and not in a patronizing way.
• FIGS also focused on arbitrage opportunities, finding things that nobody else was doing, such as creating a medical influencer program and building a direct consumer audience online.
• The company's philosophy early on was to find places and do things that nobody has done before, which helped them to differentiate themselves and avoid the brutal competition and high cost of customer acquisition that is prevalent in the apparel industry.
• Product expansion and SKU productivity are important metrics to focus on, but it's important to keep things simple and focused on solving a problem for the customer.
• Trina suggests that keeping a tight focus on a few key products can lead to better success and customer loyalty, citing that 13 styles account for over 80% of FIGS' revenue.
• The 80/20 rule is also important to keep in mind, as 20% of customers and 20% of SKUs drive 80% of sales.
• The company values non-seasonality and streamlined production, which allows them to keep their lines running all year round.
• When it comes to low-performing SKUs, it's important to consider the "buy" as well as the sales. Some products may not sell as well, but are kept for showcasing important elements of the brand.
• Trina learned from her time with Meg Whitman, who ran innovative companies like eBay, to simplify and focus on what matters. Meg's approach to business was "don't major in the minor, back to simplicity. Even the most complex businesses, you can roll up into the five things that matter."
• Trina also learned from Meg Whitman to "run to the fire" when faced with problems, meaning to tackle them head-on and not shy away from difficult conversations.
• Meg's perspective on being community and customer centric helped Trina and FIGS to focus on their community and customers, and to not be focused on themselves or media attention. For example, Trina mentioned that "Even doing something like this is a little unnatural for me. eBay specifically was all about their community. She was one of the first to even define what that was. Before eBay it was like the community center. Why do people love community centers? To gather and be together. Because people love human connection. What is your business solving? People want to connect with each other, be that company that connects people. eBay did that, and we're doing that at FIGS."

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