‘Every Shopper Will Be a Seller’: Tradesy Founder Tracy DiNunzio Talks Vestiaire Collective Merger

Keerthi Vedantam

Keerthi Vedantam is a bioscience reporter at dot.LA. She cut her teeth covering everything from cloud computing to 5G in San Francisco and Seattle. Before she covered tech, Keerthi reported on tribal lands and congressional policy in Washington, D.C. Connect with her on Twitter, Clubhouse (@keerthivedantam) or Signal at 408-470-0776.

Tradesy
Image courtesy of Tradesy

When Tracy DiNunzio had the idea to build a secondhand high-end apparel company, she bootstrapped the business by renting out her bedroom on Airbnb and sleeping on her living room couch.

It worked. Over the past decade, Tradesy—the Los Angeles-based, peer-to-peer secondhand clothing platform that DiNunzio built—gained 7 million members and hauled more than $145 million in venture capital funding. DiNunzio reclaimed her bedroom. And last week, the company announced it would be acquired by Paris-based Vestiaire Collective, another peer-to-peer luxury clothing marketplace.


“There are a lot of companies in fashion resale, but we're not really competing with each other so much as trying to change consumer behavior and compete with retail,” DiNunzio told dot.LA.

Tradesy

Image courtesy of Tradesy

Together, Tradesy and Vestiaire Collective boast 23 million customers and a catalog of some 5 million fashion items valued at more than $1 billion. The U.S. has quickly become Vestiaire Collective’s largest market, and the company is using the Tradesy merger to lay new roots in the States—with plans for a new authentication center as well as a technology hub, both located in Los Angeles. DiNunzio will serve as CEO of the combined company’s U.S. operations. (Financial terms of the deal were not disclosed.)

The acquisition feels logical given the parallels between the two companies. Both were launched in 2009 by women entrepreneurs. (Vestiaire Collective was founded by Fanny Moizant and Sophie Hersan; Moizant will serve as president of the combined company, while Vestiaire Collective chief executive Maximilian Bittner will remain CEO.). Both sought to compete in a market then dominated by eBay and brick-and-mortar consignment shops, which paid sellers a fraction of the profits they were making. And both adopted a peer-to-peer model by which users can sell and buy luxury goods through their websites.

The secondhand clothing market is expected to grow to $64 billion by 2028, according to CB Insights, driven in part by similar companies like Poshmark, The RealReal, Mercari and FarFetch. These companies are seeing rapid growth, and Tradesy and Vestiaire Collective are far from the only ones consolidating: ecommerce marketplace Etsy acquired secondhand apparel platform Depop for more than $1.6 billion last year.

But resale apps like Tradesy still have a long way to go before eclipsing retail. Buying secondhand clothing online is a less consistent experience than buying from a retailer, as even the most devoted of eBay shoppers will attest. The lack of quality control, along with unpredictable shipping and unscrupulous scammers, can make for an inconsistent experience.

On the sellers’ end, uploading photos, writing descriptions and pricing out items can quickly become a full-time job. When buyers complain about purchases—whether their claim is legitimate or not—it will usually result in a refund directly out of the seller’s wallet.

“Every shopper will be a seller in the future, but it has to be easy and it has to be seamless,” DiNunzio said. “The reason that every single person isn't selling every single thing they're no longer wearing today is because it's not easy enough yet.

As middlemen, both Vestiaire Collective and Tradesy need to be able to organize millions of unique items that are described and priced in different ways—a task as logistically challenging as it sounds. In response, the company plans to automate parts of the authentication process through its L.A. technology hub, which will complement the new authentication center in the city (Vestiaire Collective’s second authentication center in the U.S. and fifth globally).

Much like startups Rent The Runway and L.A.-based Rent-a-Romper (both of which focus on short-term apparel rentals), Tradesy and Vestiaire are part of a growing number of fashion platforms invested in the “circular economy.” The concept is rooted in offsetting the damage that “fast fashion” has had on the environment by focusing on resale, repairs and rentals.

“I think we'll see kind of a whole different concept of ownership, where everything you own is sellable whenever you're done with it,” DiNunzio said. “That seems like a better way for us to consume things, and it would naturally lead to people buying higher quality things that last so that they can resell them. And that creates less waste, less disposable products in the market and ultimately gets us closer to having commerce overall be more sustainable over the years."
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TSM Suspends Partnership With FTX — The Latest in a String of Departures

Samson Amore

Samson Amore is a reporter for dot.LA. He holds a degree in journalism from Emerson College and previously covered technology and entertainment for TheWrap and reported on the SoCal startup scene for the Los Angeles Business Journal. Send tips or pitches to samsonamore@dot.la and find him on Twitter @Samsonamore.

TSM Suspends Partnership With FTX — The Latest in a String of Departures

Esports team owner Team SoloMid (TSM) announced Wednesday that it suspended its partnership with embattled cryptocurrency exchange FTX. The $210 million naming rights agreement was set last July. It was the biggest in esports history.

In a statement to dot.LA, TSM spokesperson Gillian Sheldon said, “TSM is suspending our partnership with FTX effective immediately. This means that FTX branding will no longer appear on any of our org, team and player social media profiles, and will also be removed from our player jerseys.”

Earlier this week, dot.LA reported that TSM would likely pull out of the partnership and cut its losses. In addition, we noted the esports outfit would probably look to divest itself from the controversial FTX moniker as soon as possible. On Monday, TSM said it was “consulting with legal counsel.” Currently, it remains unclear if TSM will look to sue the crypto exchange for lost sponsorship revenue – after all, the esports company was set to receive payments of $21 million across 10 years, no small chunk of change.

TSM also noted that it “may take some time” for fans to see the change back to non-FTX branding since “some social platforms have made changes to their product features.” Given Twitter’s recent issues, it’s likely that’s the platform giving TSM a headache.

TSM’s deal with FTX is far from the first to crumble in the wake of the crypto exchange’s bankruptcy filing last week.

Numerous payment companies have terminated their contracts with FTX, including Visa, which broke off a global agreement to offer an FTX debit card Nov. 15.

The majority of FTX’s ambitious deals to sponsor big-name teams across professional sports have also evaporated. The Miami Heat terminated a $16.5 million deal that would have seen FTX’s name attached to their arena until 2040 earlier this week. The Golden State Warriors also paused FTX promotions and removed all in-arena advertisements on Monday. And last Friday, Mercedes’ Formula One team suspended its agreement to be sponsored by FTX.

Investors who shilled FTX are also now the subject of a new class action lawsuit filed in Miami Nov. 16. The list of celebrities named in the suit includes Tom Brady, Steph Curry, Larry David and Gisele Bündchen. All of whom have been accused of violating the state of Florida’s Securities and Investor Protection Act and the Deceptive and Unfair Trade Practices Act. The suit is being brought forth by controversial attorney David Boies, who previously represented Theranos and Harvey Weinstein.

LA Venture: R-Squared Ventures’ Roy Rubin on the Evolution of Ecommerce

Minnie Ingersoll
Minnie Ingersoll is a partner at TenOneTen and host of the LA Venture podcast. Prior to TenOneTen, Minnie was the COO and co-founder of $100M+ Shift.com, an online marketplace for used cars. Minnie started her career as an early product manager at Google. Minnie studied Computer Science at Stanford and has an MBA from HBS. She recently moved back to L.A. after 20+ years in the Bay Area and is excited to be a part of the growing tech ecosystem of Southern California. In her space time, Minnie surfs baby waves and raises baby people.
R-Squared Ventures’ Roy Rubin
Photo provided by Roy Rubin

On the episode of the L.A. Venture podcast, R-Squared Ventures’ co-founder Roy Rubin talks about investing, ecommerce and how he got started in tech at UCLA.

R-Squared, the venture firm Rubin co-founded with his partner and former Loop Commerce co-founder Roy Erez, focuses on early-stage startups. The firm writes checks of between $500K to $1.5 million, with a focus on ecommerce, fintech, marketplaces and SaaS. R-Squared has made about 30 investments in the past 18 months.

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