When fashionistas typically think of taxes, chances are their minds are more likely to flit to the 6.25 percent tacked on to the total at the bottom of a receipt from a recent splurge than the laws surrounding tax returns for charity donations.
But not for Fashion Project Co-founders Anna Palmer and Christine Rizk.
In fact, the two friends, classmates and entrepreneurs had the idea for their online thrifted-couture-for-charity startup while in a tax course at Harvard Law School, in which they were shocked to find out that nearly $13 billion worth of clothing and accessories were donated to charities annually.
"We started brainstorming, and there were a lot of conversations in Starbucks," reflected Palmer, Fashion Project CEO. After thinking on the idea for a few months, Palmer and Rizk agreed to take the plunge and launch the company while they were in line at graduation in spring of 2011.
The basic idea behind the company is that donated designer digs can go for far more on a site dedicated to similar high-style pieces than they can when crushed on a regular thrift store rack. However, instead of putting the profit back in their pockets after donating their Jimmy Chu wedges and Caroline Herrera gown to Fashion Project, people pick a charity to receive 55 percent of the sale; the other 45 percent goes to the company. Even better, their donations are tax deductible.
Through this model, Fashion Project is able to generate typically 100 times the amount given to charities than the average socially-minded thrift store.
"While they're great organizations, if you give through a traditional thrift store, you're just not able to raise as much as money," explained Palmer.
Charity is close to hearts of both Palmer and Rizk, both of whom were heavily involved in nonprofit work prior to starting Fashion Project. Since making their pact to pursue the idea, the co-founders have signed on over 50 charities, including Dress for Success and the March of Dimes, and garnered an active user base. The site now boasts more than 17,000 regular users and counting. According to the startup's CEO, Fashion Project has raised over $800,000 in inventory donated by fashionistas with full closets from the U.S. and abroad.
Soon, however, that number could jump even higher; Hollywood has also been hearing about the platform and reaching out to get involved with the startup's mission.
"Fashion Project has been getting interest from celebrity donors, recently featuring donations from the closets of Glenn Close and Jenna Elfman," said Palmer. "There is a big-name fashion celebrity hitting the site sometime the week of November 11th, though you'll have to check FashionProject.com for the reveal."
So far, the company has raised $3 million from individual angels, and is currently looking for more funding. In 2014, Palmer and Rizk hope to make menswear offerings on the site. Fashion Project currently employs sixteen people full-time and a handful of interns out of its Seaport offices.
