“Did you know what was going on?” 

“Are you feeling smug?” 

“Come on…on some level you must have known.” 

I find myself in an interesting situation. Right smack in the middle of a massive case of financial fraud. Okay, maybe not in the middle — thank goodness — but with quite a lot of experience that relates to a current case making the headlines in the worlds of finance / fashion / startups…and I think I need to talk about it. Which means you all have get to hear what I have to say. 

Even the few of you who know me IRL might be confused…who is this woman? Wtf do I have to do with some company called CaaStle? 

That’s because before CaaStle rebranded, it was called Gwynnie Bee — quite possibly the worst company name ever fabricated into existence. Now all of the sudden those of you who know me have been immediately triggered. I can hear your collective groans from all the way over here. When I worked for Gwynnie Bee, complaining about the company name was one of my favorite pastimes. 

We hate it…right…? 

What was Christine Hunsicker thinking when she came up with that name? I asked myself that frequently during the few years that I worked for her. She — along with partners George and JP — had worked on previous ventures in the tech sector before creating Gwynnie Bee. And if nothing else, the name they chose to christen their first foray into fashion made it clear to me that these were not consumer people. They were technology people. Which is likely the first seed planted in our saga of massive fraud. 

CaaStle née Gwynnie Bee was a fashion tech startup founded in 2011 that I worked at between 2016-2018. At its inception, the company was a clothing rental platform specifically targeting plus-sized women — a market exceedingly underserved in fashion despite the fact that the majority of women in America fall into it. People who didn’t work for the company often explained it as “Rent the Runway for plus-size women”. People within the company rarely used this phrase. Because the truth is that’s not what we were trying to be. 

In fact, that very point is part of what inspired me to write this article in the first place. A few weeks ago I was listening to this podcast episode where Sammi Tannor Cohen interviews Jenn Hyman, the Co-Founder and CEO of Rent the Runway. And somewhere in the middle there it struck a nerve…

During their conversation, Jenn brings up the CaaStle situation and the two women start gleefully discussing the downfall of Christine Hunsicker — a fellow founder and possibly competitor whom Jenn Hyman seems to view in a particularly negative light. Now if either of those two women ever happen to read this (doubtful), I’m sure they’ll disagree with that characterization on numerous counts. Maybe they don’t like the term “gleeful”, and would instead argue that they were simply discussing a massive piece of relevant news in their collective realm of interest. But I think Jenn would take particular issue with my calling Christine a competitor of hers. Because based on their discussion, Jenn believes that Christine viewed her as a bitter rival. But Jenn barely gave Christine a second thought. 

Now I can’t speak to whether or not Jenn Hyman — or anyone at Rent the Runway, for that matter — gave a damn about Christine and what we were building over at (what was then still called) Gwynnie Bee. What I can attest to is what it was like to work for Christine for a few years and how differently things looked compared to what Jenn and Sammi declare with such certainty during their discussion. 

What struck me the most about the conversation between Jenn and Sammi was how firmly Jenn seems to believe — or at least vehemently claim — that Christine was “out to get” Rent the Runway (RTR). According to Jenn, Christine viewed Gwynnie Bee / CaaStle as a direct competitor to RTR and thus Jenn herself as a woman to take down. 

I have to be honest that I’m not sure we ever discussed Rent the Runway in particular detail during my tenure at the company. Sure, there was some overlap in functionality that we might talk through when discussing strategy or customer profiles. And you certainly always keep a pulse on other companies running in similar spaces when you’re building something new — that’s frankly just good practice. But in general we viewed Gwynnie Bee as operating under a completely different business model than RTR. Rent the Runway once touted that it was the largest private dry cleaning business in the world because it was cycling through so much clothing inventory. Their business was about the clothes. About the fashion. About the consumers. Gwynnie Bee, even before its rebranding, was always about the tech. 

But Jenn claims that we would hold rallies (or did she call them parades?) that were aimed specifically at destroying Rent the Runway…she seems to believe that Christine — and by extension, her employees — made it their mission to overtake RTR and maybe even discredit Jenn herself in the process. 

That feels insane to me. Not only did I never see that happen — maybe I was sick the day of the “rally” and then it was never spoken about ever again? But I also never witnessed anyone at the company, let alone anyone senior, disparage Rent the Runway other than simply saying “well, we’re not trying to be them”. Now, Jenn also claims that Christine bad-mouthed her to potential investors during her fundraising rounds, and I truly can’t speak to claims like that. I have absolutely no idea what Christine was telling investors behind closed doors. And it’s clearly come out since then that she was showing them fraudulent balance sheets, so who knows what other shenanigans might have been going on. But I just found it a bit icky (to use Jenn’s own word from the podcast) to hear her talk with such authority about a fellow founder that she herself says she never even met until 2022. 

Which brings me to my next point. 

Jenn talks about the first time she actually met Christine, and how shocked she was by how little Christine knew about the fashion space — as one fashion founder to another. This I absolutely believe to be true. Because the thing is, Christine never really saw herself as a fashion founder…she was a tech person. She’d always been a tech person. I wouldn’t go so far as to say she prided herself on not knowing much about the fashion world, because she certainly understood that it was a key component of this particular business. But in her mind the industry and the product were a means to an end — building a specific technology. And ultimately an IPO. 

You might be scratching your head wondering why a tech person would start such a clearly fashion- and consumer-focused business if that’s not what she was interested in. And that’s a question I asked myself frequently — and ultimately was a key driver that led to me leaving the company rather suddenly during the reorganization that transformed Gwynnie Bee into CaaStle. 

In fact, the mere rebranding itself is a testament to how badly Christine, George, and JP (let’s not forget the other leaders just because they’ve avoided the headlines) did not want to be viewed as fashion people. The new name “CaaStle” was itself a declaration of themselves as a technology, NOT consumer-focused business. The start of the name CaaS was intended to stand for “clothing as a service” — a play on the popular term SaaS coined to describe “software as a service” companies like Salesforce or Shopify or even Zoom. Only a mild improvement from having to spell out G-w-y-n-n-i-e B-e-e to everyone in my life, but I digress. 

So what does this all have to do with the fraud? Christine pleaded guilty…so what else is there to say about it? Why do I even still care? 

I guess this podcast episode showed me how vastly different a narrative can come from different players in a story. And considering neither Sammi nor Jenn were actually involved in the evolution of CaaStle (or its demise), I felt the need to set the record straight. Or at least add a little more context to a story that seems to be being discussed as clear cut and simple. 

And I get why it seems so cut and dried. She pleaded guilty. $300 million dollars. She did it. Right? What more is there to say? 

Actually, quite a lot. When we talk about financial fraud, we generally focus almost entirely on the dollar amount. How much did this person (or people) steal? Just how greedy were they? 

We distill it down to that one quality: greed…

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And sometimes it really is that simple! These people (::coughcough::often men::coughcough::) believe themselves invincible. Entitled to more than their fair share — even when that share is already skewed to their benefit. So big for their britches that they probably fundamentally believe that they’re simply getting what they’re due in the first place. This is the stereotype of the arrogant finance bro that has been created because, frankly, there are sufficient real-world examples for the archetype to have taken hold. 

But what about the times when it’s not so cut and dry? Human behavior is rarely as uncomplicated as we’d like it to be. 

In the case of Christine, what the headlines largely overlook is the why. Why did she defraud her investors in such an egregious manner? 

It doesn’t appear that she was pocketing the money to finance a high-flying lifestyle — sure, I remember her having a nice car back in the day, but as far as I know she wasn’t buying a superyacht or a private island or even wasting the money on ridiculous company expenditures that you see in many of these cases (see: Adam Neumann spending $90 million of WeWork funds on real estate, including property with a private waterfall). 

I’m sure she had some level of desire to grow her own wealth. But before founding Gwynnie Bee she served as COO of Right Media, which was acquired by Yahoo! for more than $600 million dollars. She was probably doing just fine financially. In fact, I heard through the grapevine of former CaaStle employees that she may have even used her own wealth to float the difference in cash while attempting to “make up” for the missing money due to her fraudulent accounting practices. That reads more like someone who thinks they might be able to “undo” their fraud so that no one notices, not so much like someone looking to secretly profit off of it. 

But we know she was hoping to IPO CaaStle…so maybe the greed came from her expected windfall from debuting on the public market? That feels a bit thin for anyone who understands how volatile leading a public company can be. But there is surely a large potential upside for taking a company public. Even if the downside is just as extreme. I’ll again cite the irrationality of human behavior here — we are profoundly capable of focusing entirely on potential up (or down) side when trying to justify going after something we really want. 

So does that leave ego? Maybe the validation of leading a company into the public sector was all that mattered, and Christine let her pride get the better of her…a la Elizabeth Holmes and Theranos. 

That doesn’t feel quite right to me either though. If you followed the Elizabeth Holmes saga (btw I highly recommend reading Bad Blood if you haven’t — an incredible work of investigative journalism that really shows the evolution of a very different type of fraud), you might feel as I do that Holmes seemed to be driven by a deep sense of hubris. Sure, she appeared to have started out truly believing in the product she was trying to build. And the blood tests themselves certainly would have made a significant impact on healthcare (were they to ever actually work). But the corners she cut and the lies she told felt much more about a woman who refused to accept that she could be fallible — let alone actually wrong — than someone who was genuinely trying to create what she was promising to the world. 

In Christine’s case, I think that many of these qualities played some sort of role…ego certainly factored in. And greed can’t be completely ignored. But I think what gets lost in a lot of headlines and exposés these days (and frankly, all news imo) is the human element. Christine painted herself into a corner. She made a very unwise decision to fudge some numbers — and likely felt that once she’d made that concession, the only way out was through. 

I’m in no way condoning the fraud. And I think we can confidently call it that now that she’s officially pled guilty. But I do wonder how many other cases of egregiously bad behavior began with a single misstep that may have been viewed as small, and even reversible, before the perpetrator realized that there was simply no turning back. Sometimes genuine intentions go sour. And more often than we’d like to admit we as human beings behave badly when we think there’s little chance of being caught. And it seems that at least at the onset, Christine felt confident enough in the company she was building that she truly believed she would be able to rectify the situation before anyone wised up to the mess she’d created. 

Was that naive? Sure. But was it malicious? I’m not convinced. 

Listen, we’ll never truly know Christine’s original objective when she made the decision to falsify that first document. In fact, we’ll probably never know which cell on which excel sheet sent to which potential investor was the first domino to fall before turning into a cascade of dishonesty. But being personally involved with — or at least adjacent to — one of these cases for the first (and hopefully last…) time has been eye opening. Because I can’t see past my own bias, and my own desire to see her humanity, in my reading of every headline that a former coworker or friend or random LinkedIn connection sends to me with a snarky comment about how lucky I was to get out of there when I did. 

Is it on us as consumers of media to see the people behind the headlines? On journalists themselves to push back against the click-bait rewards system that has become our information economy? 

As always these conversations are constantly evolving, so reply or comment to give me your take ⬇️ 

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