When most people clean out their closet, they usually either lug the castoffs to a consignment store, trade pieces with friends or simply donate the whole lot to Goodwill.

But James Reinhart, a recent graduate of the Harvard Business School, thinks there might be a way to upgrade the age-old clothing swap — and turn it into a lucrative business.

“None of the other models — posting items and selling them on eBay, bartering or selling them — were enticing enough from a convenience standpoint,” said Reinhart.

When members sign up, they create a virtual closet listing the items they have and detailing what kinds of items, including sizes and brands, they would like to receive.

After ordering a package of prepaid envelopes from ThredUp (three for $25), the company’s algorithms match size and apparel preferences and sends members an e-mail telling them where to snail mail their gently used finery. A week or so later, those members should receive an item of their own.

If it sounds a bit like the model popularized by Netflix, that’s because it is: Reed Hastings, the founder and chief executive of Netflix, is an adviser to the company.

“It’s sort of like a controlled lottery,” said Reinhart.

Part of that means damage control: Reinhart says ThredUp has a “zero tolerance” for members who mail out subpar items, like something unfashionably frayed or stained with pinot noir.

First-time offenders get flagged; a second offense gets them removed from the system.

ThredUp incorporates ratings and feedback from participants and matches them accordingly. (NYT)