When I was a kid there was this mail-order thing called Columbia House Record Club. It was the same business model. They entice you with super cheap music.. if you signed up for a monthly subscription. I was a happy customer. Because I was smart enough to work the system, cancel in time and get a bunch of free CDs for pennies.

But guess what? Somebody was filling their coffers and it wasn't me. Columbia House made $500M/year. It was the regular folks who didn't pay close attention and didn't realize just how much they'd be charged on a recurring basis for stuff they didn't want.

So this VC's use of high customer satisfaction rates as a defense is utterly without merit. That's the nature of this business: savvy customers do well, but at the expense of another set of exploited customers.

Here's a great article on Columbia House, which calls it "one of the more dishonest and predatory marketing devices of the 20th century". It could just as well be about JustFab.

http://thephoenix.com/boston/music/129722-rise-and-fall-of-t...

Oh.. and now I have a really bad impression of Matrix Partners.