FIGS details path from scrubs startup to public company
FIGS has grown into a public company with a market cap over 2.5 billion dollars by bypassing traditional distributors. The founders attribute success to a direct-to-consumer model and deep community engagement among healthcare workers.
Heather Hassan and Trina Speer launched FIGS in 2013 to sell better-fitting, fashionable scrubs to the 24 million healthcare workers in the U.S., a segment where 85% of professionals purchase their own uniforms. The U.S. healthcare apparel market was valued at approximately 10 billion dollars at launch and is now over 12 billion dollars, part of an 80 billion dollar global industry. After receiving 300 to 400 rejections from investors, the company raised 10 million dollars in early funding. In 2017, Thomas Tull, founder of Legendary Entertainment, bought out the cap table for a significant return and invested approximately 65 million dollars, becoming the majority owner while the founders retained board control.
Revenue grew from 1 million dollars in 2015 to 55 million dollars in 2018, 110 million dollars in 2019, and 263 million dollars in 2020. FIGS went public in May 2021, with the stock reaching 50 dollars in the first month before dropping to 5 dollars the following year. The company currently has a market cap of over 2.5 billion dollars, 3 million active customers, and reported EBITDA of 36.6 million dollars in the last reported quarter. Speer is the current CEO, while Hassan serves as executive chairman.
FIGS built its business by selling directly to healthcare professionals, bypassing traditional distributors who took 60% of the retail price. This direct model allowed FIGS to charge only 15-20% more than competitors while maintaining higher margins for innovation. The company utilized digital marketing, particularly on Facebook, during the 2014-2020 period when customer acquisition costs were low. Word of mouth became the largest customer acquisition driver as healthcare professionals, described as a tightly knit community, wore the brand in densely populated institutions. FIGS focused on specific product innovations, such as the 'Raffaella' sleeveless top and slim-fit pants, which were initially met with skepticism but became top sellers. The company also invented the 'underscrub' layering piece. During the pandemic, FIGS shifted its supply chain to produce N95 masks and cloth masks, and donated hazmat suits and isolation gowns, leveraging manufacturing relationships established over eight years. The founders emphasized that building a community around a profession created a diehard customer base that could not be replicated by competitors relying on traditional gatekeepers or celebrity endorsements.