Sign up for our daily briefing

Make your busy days simpler with Axios AM/PM. Catch up on what's new and why it matters in just 5 minutes.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stay on top of the latest market trends

Subscribe to Axios Markets for the latest market trends and economic insights. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Sports news worthy of your time

Binge on the stats and stories that drive the sports world with Axios Sports. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Tech news worthy of your time

Get our smart take on technology from the Valley and D.C. with Axios Login. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Get the inside stories

Get an insider's guide to the new White House with Axios Sneak Peek. Sign up for free.

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Denver news?

Get a daily digest of the most important stories affecting your hometown with Axios Denver

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Des Moines news?

Get a daily digest of the most important stories affecting your hometown with Axios Des Moines

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Twin Cities news?

Get a daily digest of the most important stories affecting your hometown with Axios Twin Cities

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Tampa Bay news?

Get a daily digest of the most important stories affecting your hometown with Axios Tampa Bay

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Want a daily digest of the top Charlotte news?

Get a daily digest of the most important stories affecting your hometown with Axios Charlotte

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Please enter a valid email.

Please enter a valid email.

Subscription failed
Thank you for subscribing!

Stitch Fix founder and CEO Katrina Lake. Photo: Nasdaq

Stitch Fix, a personalized shopping subscription service, began trading on the NASDAQ this morning after raising $120 million in its IPO. Axios spoke with founder and CEO Katrina Lake. Here's the quick read:

  • She believes Stitch Fix serves a very different need than does Amazon.
  • Stitch Fix struggled in its early days to raise venture capital, which caused it to focus more on profitability.
  • Going public is about having increased flexibility to pursue bigger opportunities.

Setting the scene: Stitch Fix's IPO last night comes across as a dud, given that it sold fewer shares than expected at a price below its stated range. But this isn't the disaster it might be for other VC-backed startups, in that Stitch Fix raised relatively little venture capital ($44 million) at a modest valuation (last post-money was $300m). That means both investors and employees should be in the money at the $1.5 billion, post-IPO (fully diluted) value — something that wouldn't have necessarily been true if Stitch Fix had chased bloated unicorn dreams. Plus, shares are up in early trading.

Here is the Q&A:

Why did the IPO come up a bit short of your expectations?

"It's hard to say. The story of Stitch Fix is a nuanced one to tell and can take a little time for people to get their heads around. The data science and personalization is a different business model from other things out there. It's not e-commerce, it's not stores. But while we maybe didn't get the exact price we expected, we're very excited to get top-tier investors and are happy to go prove ourselves to those who might have underestimated us. I'm not going to be focused on the stock price from day-to-day, because we want to generate value over years. My deep conviction is that the company will end up being worth more in the future than it is today.

Stitch Fix only raised $44 million from VCs, which is relatively little by today's standards, and never at a valuation higher than $300 million. Why didn't you go for a "unicorn" round?

"It was hard to raise money for this company, so we always treated every dollar very preciously and focused early on profitability. I'm also not valuation focused, so we weren't going to raise money if we didn't need it. When it came to recruiting, there was a lot of upside in having a valuation to grow into."

Why go public now?

"We have plenty of capital on the balance sheet, so there was no forcing function. We're at a place where we've grown year-over-year consistently, felt there is a lot of predictability in the business and just felt like it was a good time. I'm glad we didn't go a year ago because there might have been out-sized expectations based on growth rates... It gives us flexibility, and helps us see how big a business personalization can be and how pervasive in the retail experience."

Your moat against Amazon is curation and personalization. Can that be maintained?

"We see ourselves as solving a very different problem in a very different way. Amazon is a lot about faster and cheaper when it comes to clothing, and in a lot of product categories that's a great value proposition. But the reality in fashion is that to find that one great pair of jeans that fits perfectly, you don't want endless choice or the cheapest option. You want the one thing on the planet that's best for you."

Go deeper

United CEO is confident people will feel safe traveling again by 2022

Axios' Joann Muller and United CEO Scott Kirby. Photo: Axios

United Airlines CEO Scott Kirby believes that people will feel safe traveling again by this time next year, depending on the pace of vaccinations and the government's ongoing response to the pandemic, he said at an Axios virtual event.

Why it matters: Misery for global aviation is likely to continue and hold back a broader economic recovery if nothing changes, especially with new restrictions on international border crossings. U.S. airlines carried about 60% fewer passengers in 2020 compared with 2019.

The risks and rewards of charging state-backed hackers

Illustration: Sarah Grillo/Axios

Last week’s stunning indictment of three North Korean hackers laid bare both the advantages and drawbacks of the U.S. government’s evolving strategy of using high-profile prosecutions to publicize hostile nation-state cyber activities.

Why it matters: Criminal charges can help the U.S. establish clear norms in a murky and rapidly changing environment, but they may not deter future bad behavior and could even invite retaliation against U.S. intelligence officials.

39 mins ago - World

Scoop: Netanyahu asked Biden to keep Trump's sanctions on International Criminal Court

ICC chief prosecutor Fatou Bensouda. Photo: Bas Czerwinski/ANP/AFP via Getty

Netanyahu asked Biden in their first phone call last week to keep sanctions imposed by the Trump administration on the International Criminal Court (ICC) in place, Israeli officials tell me.

Why it matters: Israeli officials are concerned that removing the sanctions would hamper Israel's efforts to stop a potential war crimes investigation into Israel, and that the court's prosecutor could see it as a signal that the U.S. isn't firmly opposed to that investigation.