C
Christine Hall
Guest
Rebag, which buys, sells and trades luxury items like handbags and accessories, raised a \)"> 4 million in seed funding to go after incumbents like The RealReal.
Novator led the latest round, with participation from existing investors, including General Catalyst, to bring the company’s total funding to date to\)"> 15 million Series D round in 2020, also led by Novator.
“It was a function of COVID generating digitization of underpenetrated industries, in particular luxury,” Gorra added. “Before COVID, purchases of luxury goods was 8% in the U.S. and now it is closer to 20%. Luxury stores can be uncomfortable, so our goal was how to make that experience more approachable.”
The company has since seen a trend of owning fewer items, but of those that are purchased, they are of higher quality, are made better, are longer lasting and retain some resale value. That’s important in the luxury space because Rebag’s average ticket is
Though Gorra believes the luxury goods resale market is still in its infancy, citing that one out of 10 luxury items are transacted in the resale market, there are dozens of secondhand marketplaces for handbags and other items, also those not necessarily luxury goods.
The secondhand market is expected to double and reach \)"> 77 billion by 2025, according to ThredUp, which went public earlier this year after raising over 500 and Poshmark is 2,000, he noted.
Another differentiator is that Rebag controls the purchases and sales versus some of the other platforms that are peer-to-peer sales, sometimes causing those transactions to take days as each party manages their own sides.
“We believe our value prop is on the high-end goods market and want to be the trusted place for premium resale,” Gorra said. “We want to be a leader in this space, where we believe there will eventually be a large resale ecosystem, and we want to be a part of it.”
Novator led the latest round, with participation from existing investors, including General Catalyst, to bring the company’s total funding to date to
At that time, Rebag’s path was uncertain, with the global pandemic, Gorra explained. He took the \)">15 million to have some buffer as the company weighed its options. What happened was that the company ended up with two strong years of revenue growth — 50% in 2020 and 70% estimation for 2021 — basically close to triple the amount of growth over the two-year period, he said.
“It was a function of COVID generating digitization of underpenetrated industries, in particular luxury,” Gorra added. “Before COVID, purchases of luxury goods was 8% in the U.S. and now it is closer to 20%. Luxury stores can be uncomfortable, so our goal was how to make that experience more approachable.”
The company has since seen a trend of owning fewer items, but of those that are purchased, they are of higher quality, are made better, are longer lasting and retain some resale value. That’s important in the luxury space because Rebag’s average ticket is
Another differentiator is that Rebag controls the purchases and sales versus some of the other platforms that are peer-to-peer sales, sometimes causing those transactions to take days as each party manages their own sides.
“We believe our value prop is on the high-end goods market and want to be the trusted place for premium resale,” Gorra said. “We want to be a leader in this space, where we believe there will eventually be a large resale ecosystem, and we want to be a part of it.”