Why This Venture-Backed Startup Decided to Hold Its Launch Event in Anchorage, Alaska
Plus-size fashion companies are having a moment, scoring funding and inking trendy partnerships at an unprecedented rate. The latest entry in the category is Part & Parcel, a “social commerce community” for plus-size women offering basics from sizes 14 to 36.
While Dia&Co is pursuing the plus-size market as a subscription service and brands like Universal Standard are popping up as retail locations and in Target, Part & Parcel has opted for an unusual model: the company’s structure is reminiscent of a multi-level marketing (MLM) platform—a business model that has been criticized as risky to the point of making “gambling look like a safe bet in comparison.” Yet founder Lauren Jonas says she’s fully aware of the problems with MLMs and has taken steps to protect the women who buy and sell Part & Parcel.
The gist is this: Part & Parcel sells its small collection of apparel and shoes (all footwear is wide width) via “partners,” or women who sign up to evangelize the products to their networks. But unlike traditional MLMs, those women don’t have to buy up inventory before they can start to sell. Instead, the money they put into the gig is limited to a $125 sign-up fee. While sellers still make money from recruiting other women to join, there’s a two-level limit in place to prevent the structure from turning into a full pyramid. Sellers make up to a 30% commission on any Part & Parcel products they sell to their network. Items are priced at $118 for a dress or $128 for a classic cigarette pant.
It was a tricky structure to sell to investors when compared to the easier-to-explain direct-to-consumer model, Jonas found—although the company ended up raising a $4 million seed round led by Lightspeed Venture Partners. But Jonas was committed to the business model as a way of solving another problem facing plus-size women—one that goes beyond their wardrobe.
“The plus-size population is one that faces an inordinate amount of workplace discrimination. She is also economically and socioeconomically impacted as a result of her size,” Jonas says. “I wanted to create a company that … put money in her pocket. Rather than putting money into the hands of advertisers, as you would in a direct-to-consumer context, I wanted to put that money into her pocket to try to solve some of the systemic problems.”
It’s an attitude reflected in Part & Parcel’s launch strategy. The startup went straight to Anchorage, Alaska for its launch event, hoping to reach a market where most women are plus-size, unemployment and poverty are high, and women face a “clothing desert,” with retailers like Walmart closing and fewer options when shopping online with limited shipping.
Jonas founded the business after four years leading expansion at Poshmark and a decade as a plus-size blogger under the moniker “The Pear Shape.” The insights she gained there led her to develop the other element she hopes will distinguish Part & Parcel: “dimensional sizing.” Customers can choose a size with more room in the bust or arms, for example, while keeping the rest of the garment the same, an arrangement meant to solve common problems like button-downs that gape across the bust, or blazers that are too tight in the shoulders.
Lightspeed’s investment in Part & Parcel is the venture firm’s first in the plus-size category; investor Jeremy Liew was convinced by Jonas’s personal understanding of the industry and the company’s unique approach to the category.
“I’m a plus-size woman, a size 20-22. I have been [plus-size] since I was 10 years old,” Jonas says. “I wanted to make that personal experience accessible to women around the country.”
More must-read stories from Fortune:
—How to stop automation from leaving women behind
—SoftBank’s Kirthiga Reddy says the fundraising “environment has changed”
—Why luxury fashion sees the sustainability movement as an opportunity
—The Fortune 500 has more women CEOs than ever before
—Listen to our new audio briefing, Fortune 500 Daily
Keep up with the world’s most powerful women with Fortune‘s Broadsheet newsletter.