Retail success started in dorm room

Susan Gregg Koger, founder of the online vintage and indie designer clothing purveyor ModCloth, was born with bargain hunting in her DNA. "Growing up, my mom and my grandmother used to take me thrifting," she says. "They definitely taught me the thrill of the hunt and finding a great bargain."

The summer before she left home in Florida to attend Carnegie Mellon University in Pittsburgh, Koger found herself thrift shopping "all the time" and amassing a collection of fabulous vintage items whether or not they actually fit her. Her boyfriend (now husband and business partner) suggested she start an e-commerce website. At summer's end, Koger loaded up her car with her finds, headed to school, and started ModCloth out of her dorm room.

She recalls, "The customer care number was just my cell phone number. I'd be in the library and have to sneak out and be like, 'Thank you for calling ModCloth. How can I help you?"

In 2005, after graduating from college with a degree in Business Administration, Koger decided to pursue ModCloth full-time. Up until that point, she had only earned about $5,000 dollars in revenue per year and had maxed out her credit cards and student loans. However, over the next three years the company took off with a growth rate of more than 2000%. Today, ModCloth has 240 employees and offices in Pittsburgh, San Francisco, and Los Angeles.

What Koger loves about running a company based on the Internet is having a free exchange with her customers. She describes the fashion business as being "traditionally this industry that's…intimidating and scary. Like, 'We're the cool ones and we tell you what to wear.'"

Koger says the Internet has totally changed that and blurred the boundaries between designer, customer, and retailer. ModCloth gets feedback from its customers on new designs before they actually go into production. They also have a photo-sharing site where customers post pictures of their daily outfits. Kroger herself is constantly checking out street style blogs and getting inspiration from around the globe.

Back in the beginning of ModCloth, there were times when Koger thought they might go into bankruptcy unless they could get their inventory moving. Still, she remembers, "it didn't feel like work, the hours just flew by." She advises aspiring entrepreneurs to likewise pursue something that they truly love and feel passionate about. Nowadays, Koger reports that ModCloth's best vintage pieces are typically snapped up off the website within 5 minutes.