The rising popularity of omni-channel commerce — selling to customers wherever they happen to be spending time online — has spawned an army of shopping tools and platforms that are giving legacy retail websites and marketplaces a run for their money. Now, one of the faster growing of these is announcing an impressive round of funding to stay on trend and continue building its business.
Depop, a London startup that has built an app for individuals to post and sell (and mainly resell) items to groups of followers by way of its own and third-party social feeds, has closed a Series C round of $62 million led by General Atlantic. Previous investors HV Holtzbrinck Ventures, Balderton Capital, Creandum, Octopus Ventures, TempoCap and Sebastian Siemiatkowski, founder and CEO of Swedish payments company Klarna all also participated.
The funding will be used in a couple of areas. First, to continue building out the startup’s technology — building in more recommendation and image detection algorithms is one focus.
And second, to expand in the US, which CEO Maria Raga said is on its way to being Depop’s biggest market, with 5 million users currently and projections of that going to 15 million in the next three years.
That’s despite strong competition from other peer-to-peer selling platforms like Vinted, Poshmark, and social platforms that have been doubling down on commerce, like Instagram and Pinterest, but on the other hand the opportunity is big: a recent report from ThredUp, another second-hand clothes sales platform, estimated that the total resale market is expected to more than double in value to $51 billion from $24 billion in the next five years, accounting for 10% of the retail market.
Prior to this, Depop had raised just under $40 million. It’s not disclosing its valuation except to say it’s a definitely upround. “I’m extremely happy,” Raga said when I asked her about it this week.
The rise of the bedroom entrepreneur
The funding comes on the heels of strong growth and strong focus for the startup.
If “social shopping”, “selling to groups of followers”, and the “use of social feeds” (or my headline…) didn’t already give it away, Depop is primarily aimed at millennial and Gen Z consumers. The company said that about 90% of its active users are under the age of 26, and in its home market of the UK it’s seen huge traction with one-third of all 16-24 year-olds registered on Depop.
Its rise has dovetailed with some big changes that the fashion industry has undergone, said Raga. “Our mission is to redefine the fashion industry in the same way that Spotify did with music, or Airbnb did with travel accommodation,” she said.
“The fashion world hasn’t really taken notice” of how things have evolved at the consumer end, she continued, citing concerns with sustainability (and specifically the waste in the fashion industry), how trends are set today (no longer dictated by brands but by individuals), and how anything can be sold by anyone, from anywhere, not just from a store in the mall, or by way of a well-known brand name website. “You can now start a fashion business from your bedroom,” she added.
For this generation of bedroom entrepreneurs, social apps are not a choice, but simply the basis and source of all their online engagement. Depop notes that the average daily user opens the app “several times per day” both to browse things, check up on those that they follow, to message contacts and comment on items, and of course to buy and sell. On average, Depop users collectively follow and message each other 85 million times each month.
This rapid uptake and strong usage of the service has driven it to 13 million users, revenue growth of 100% year-on-year for the past few years, and gross merchandise value of more than $500 million since launch. (Depop takes a 10% cut, which would work out to total revenues of about $50 million for the period.)
When we first wrote about Depop back in 2015 (and even prior to that), the startup and app were primarily aiming to provide a way for users to quickly snap pictures of their own clothes and other already-used items to post them for sale, one of a wave of flea-market-inspired apps that were emerging at that time. (It also had an older age group of users, extending into the mid-thirties.)
Fast forward a few years, and Depop’s growth has been boosted by an altogether different trend: the emergence of people who go to great efforts to buy limited editions of collectable, or just currently very hot, items, and then resell them to other enthusiasts. The products might be lightly used, but more commonly never used, and might include limited edition sneakers, expensive t-shirts released in “drops” by brands themselves, or items from one-off capsule collections.
It may have started as a way of decluttering by shifting unused items of your own, but it’s become a more serious endeavor for some. Raga notes that Depop’s top sellers are known to clear $100,000 annually. “It’s a real business for them,” she said.
And Depop still sells other kinds of goods, too. These pressed-flower phone cases, for example, have seen a huge amount of traction on Twitter as well as in the app itself in the last week:
Alongside its own app and content shared from there to other social platforms, Depop extends the omnichannel approach with a selection of physical stores, too, to showcase selected items.
The startup has up to now taken a very light-touch approach to the many complexities that can come with running an e-commerce business — a luxury that’s come to it partly because its sellers and buyers are all individuals, mostly younger individuals, and, leaning on the social aspect, the expectation that people will generally self-police and do right by each other, or less risk getting publicly called out and lose business as a result.
I think that as it continues to grow, some of that informality might need to shift, or at least be complemented with more structure.
In the area of shipping, buyers generally do not seem to expect the same kind of shipping tracking or delivery professionals appearing at their doors. Sellers handle all the shipping themselves, which sometimes means that if the buyer and seller are in the same city, an in-person delivery of an item is not completely unheard of. Raga notes that in the US the company has now at least introduced pre-paid envelopes to help with returns (not so in the UK).
Payments come by way of PayPal, with no other alternatives at the momen. Depop’s 10% cut on transactions is in addition to PayPal’s fees. But having the Klarna founder as a backer could pave the way for other payment methods coming soon.
One area where Depop is trying to get more focused is in how its activities line up with state laws and regulations.
For example, it currently already proactively looks for and takes down posts offering counterfeit or other illicit goods on the platform, but also relies on people or brands reporting these. (Part of the tech investment into image detection will be to help improve the more automated algorithms, to speed up the rate at which illicit items are removed.)
Then there is the issue of tax. If top sellers are clearing $100,000 annually, there are taxes that will need to be paid. Raga said that right now this is handed off to sellers to manage themselves. Depop does send alerts to sellers but it’s still up to the sellers themselves to organise sales tax and other fees of that kind.
“We are very close to our top sellers,” Raga said. “We’re in contact on a daily basis and we inform of what they have to do. But if they don’t, it’s their responsibility.”
While there is a lot more development to come, the core of the product, the approach Depop is taking, and its success so far have been the winning combination to bring on this investment.
“Technology continues to transform the retail landscape around the world and we are incredibly excited to be investing in Depop as it looks to capture the huge opportunity ahead of it,” said Melis Kahya, General Atlantic Head of Consumer for EMEA, in a statement. “In a short space of time the team has developed a truly differentiated platform and globally relevant offering for the next generation of fashion entrepreneurs and consumers. The organic growth generated in recent years is a testament to the impact they are having and we look forward to working with the team to further accelerate the business.”
Teenage Engineering computer-1 flat-pack PC chassis instantly sold out
The folks at Teenage Engineering had a brand new pc chassis for sale earlier today. By the time it really started trending on social networks, it was already sold out. This chassis is designed to be simple and light, but strong enough to withstand basic wear-and-tear. The version the design group had for sale this morning would’ve cost you around $195 – but they’ve released the layout plans so you could technically make one of your own.
The Teenage Engineering Computer-1 was sold in the Teenage Engineering shop for $195 USD. For that cash you got a flat-pack set of laser-cut sheet metal parts with a couple of chrome metal handles and some rubber bumpers for the feet. The sheet metal has a pure orange RAL 2004 powder coated finish.
If you would like to build one of these sets yourself, you can get the plans from Teenage Engineering now. You’ll need your own laser cutting machine, or a way to 3D print similar parts. The original was made with 1mm aluminum, so you might need to modify the way you make the build if you’re using any other sort of material.
Teenage Engineering may make another run of these cases in the future. Given the interest shown today, it’d make sense for the group to make more, but given the group’s aim and track record, there’s a distinct possibility that this release began and ended here, in a single day.
This might be a fine wake-up call for other PC case creators, too. Imagine the simplicity of manufacturing a bunch of flat metal pieces and selling the package to users IKEA style. Now, all you need is the hype power and top-tier 3D design skills of the folks at Teenage Engineering, and you’ve got a winner on your hands.
Instagram Stories links are now available for all accounts
Instagram has confirmed that it’s bringing the ability to and links to Stories for all user accounts. When Stories links were first revealed, they were only available for verified accounts or accounts with a certain number of followers. However, Instagram says over the years it has seen that the ability to share links to stories is helpful, so it’s expanding access to everyone.
The Instagram community has been asking for Stories links for everyone to make sharing content with friends and family easier. Links are now available for sharing for everyone with no stipulation on account size. To add links to Stories, users can use the Link sticker.
When people click the sticker, they will be redirected. Adding a Link sticker is easy and starts with capturing or uploading content to the story. Users then select the sticker tool from the navigation bar and tap the Link sticker to add the desired link. Once that is complete, users can place the sticker on their story, and there are variations of the sticker available.
Instagram also says it’s working on customizing the sticker to make it clear what users will see when they tap it. Instagram is also talking about its ongoing effort to keep its community of users safe. To facilitate safety, new accounts and accounts that repeatedly share content, including hate speech or misinformation, as well as anything that violates community guidelines, won’t have access to the Link sticker.
The Link sticker isn’t the only change Instagram has made this month. Previously, Instagram announced that its desktop app was getting photo upload capability. Before adding the capability to upload content from the desktop app, all uploading had to be done from the mobile app. The change was implemented on October 21.
2021 MacBook Pro teardown tease shows what’s on the inside
It’s very common for manufacturers like Apple to release new products, and fans always want to know what they look like on the inside. However, the last thing most of us want to do is tear apart our brand-new and expensive gadgets to look. Thankfully, IFIXIT has been gutting new devices for a long time, giving us a look at what’s on the inside without having to trash our own hardware.
Right now, a teardown for the 2021 MacBook Pro is being teased with a few pictures ahead of the full reveal. As you would expect, everything is packed very tightly into the thin and lightweight MacBook Pro notebooks. While there are no real details offered at this time about the hardware inside, we already know what to expect from Apple’s official event.
Apple has fitted its 2021 model notebooks with additional ports. An improved keyboard is integrated that hopefully won’t break if you eat lunch and work at the same time. MagSafe charging is integrated, and Apple ditched the Touch Bar for traditional function keys. The real changes come in new Apple silicon running the show. One interesting tidbit that has been shared from the full teardown is that the battery cells have pull tabs to make them easier to remove and aren’t crammed under a logic board.
We hope that means should your battery go bad down the road; you don’t have to completely disassemble the notebook to install a new one. The four outer cells of the battery have pull tabs similar to those used in the iPhone and MacBook Air. However, we will have to wait for the full teardown to know everything about these batteries and just how easy they are to remove and replace.
The prospect of more DIY friendly component placements should have Mac fans excited. The gang also got their hands on that $20 official Apple polishing cloth, simply called the “Polishing Cloth.” A price of $19 is pretty steep for cloth used to shine the screen of your iPhone, but it has an Apple logo, and that’s enough for some. The cloth feels like Alcantara and appears to be the same material used inside the iPad Smart Cover.
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