Kara Richter

Who: Kara Richter of From Bags to Riches, an online luxury handbag “boutique” that aims to make high fashion highly affordable by lending designer handbags to consumers at a fraction of the retail price. In an era of the must-have, of-the-moment, fad handbag, Richter and business partner Samuel Mangiere carry the season’s hottest handbags so middle-American fashionistas can too.

The Bag Idea: When they started looking into opportunities for an Internet–based business, Richter and Mangiere came upon a local man who was leasing golf clubs over the Web. “We thought the business idea would work for handbags too,” Richter says.

Something Borrowed: While From Bags to Riches is not the first online site to rent designer handbags, Richter set her company apart from the field. “We haven’t required a membership. Buyers can borrow as often as they desire.” For their most loyal bag ladies, Richter and Mangiere also set up the Club Diva membership program. For a monthly fee, frequent customers receive special perks—for example, they may request bags not in the inventory. “For a customer who always wants the newest and the hottest, this is a very attractive incentive,” says Richter.

For Keeps: If you are toying with the idea of buying a designer handbag, From Bags to Riches is a great way to test-drive the bag. And if you buy through the Club Diva program, you are able to set up a buyout plan, the monthly cost of which is often similar to that of the bag rental fee. “It’s similar to a lease-to-loan auto program.”

Haute Handbags: As the fashion industry is ever-rotating, so is the handbag selection. “When we started, we had about sixty different styles,” says Richter. Now we carry between 300 and 500 styles.” Rental prices for the bags range from $22.95 to $299.95, depending on the designer. The merchandise, which is arranged in collections, ranges from lower priced bags by designers such as Coach and Dooney & Bourke to styles from top fashion houses, including Chanel, Chloé, and Fendi. There are even a few pieces from Hermés.

What’s to Come: Recently, Richter and Mangiere launched Bag Banco, where customers can sell their handbag castoffs. The pair authenticates, cleans, refurbishes, and refinishes the bags; and sellers get a bigger return (80 percent of retail value) than traditional consigning (usually 25 percent of retail value).