Clearly indicated on: http://en.wikipedia.org/wiki/JustFab http://en.wikipedia.org/wiki/JustFab Obviously the VCs did diligence - however they must have consi

Clearly indicated on: http://en.wikipedia.org/wiki/JustFab http://en.wikipedia.org/wiki/JustFab Obviously the VCs did diligence - however they must have considered the shady business as an acceptable risk factor. I think the answer to what you are asking is many businesses start in the grey zone. Recently many folks made huge bank with recurring billing with no notice. Ring tones and internet games both went that path. Justfab seems to be breaking into a new industry with that same business model. You should consider that most people consider this nonsense the fault of the purchaser, 'buyer beware'. Gym memberships are a classic example of this.