While eBay tries to get more social and local, and Pinterest deepens is position in e-commerce, a new mobile app out of London is building out a platform that combines all of those experiences together natively. Depop, a mobile app for iOS and Android that is part Instagram-style social network and part eBay marketplace, has raised an $8 million Series A round led by Balderton Capital (formerly Benchmark Capital Europe) and Holtzbrinck Ventures. It will use the funding to expand into the U.S., with new hire Erik Martin, the ex-GM of Reddit, leading the charge.
Since launching in the UK in 2013 (having first opened for business in Italy two years before that), Depop has seen 1.8 million downloads of its app, and while it has yet to disclose metrics like gross merchandise value or overall revenues, CEO Runar Reistrup says that individual posters in the UK — who pay no listing fee but give Depop a 10% cut of sales — have sold “thousands of items” and made “tens of thousands of pounds” in the process. There are millions of items on offer on a given day.
As a virtual flea market, Depop is very easy to use: as a seller, you basically take a picture and upload it in a very few steps to your “shop.” As a buyer you can either search for items by keyword or by browsing lists from other people you follow, responding to things people have tagged for you to look at, or follow Depop’s recommendations for you made by its in-house curators.
What makes Depop interesting as a marketplace, however, is its strong second life as a social networking community. Reistrup says people are almost as likely to come just to look and comment on things and converse with each other as they are to buy. In other words, people may come for eBay-style marketplace, but they stay for the Instagram-style experience, with many people checking in up to 8 times a day.
“We look less like an e-commerce site, and much more like a social media platform,” Reistrup says.
He says that many come just to hang out and chat with each other, and there have even been instances of “Depop dates” coming out of the app. Indeed, Depop is also eye-catching because of the demographics it targets.
Right now it has “almost a 50-50 split” between men and women using the site, the CEO says, and its audience is primarily in the coveted 18-36 age bracket. Given Pinterest’s push to make itself more “man-friendly” and eBay’s fusty reputation as a legacy marketplace whose users skew to older age brackets, Depop’s more youthful, gender-neutral positioning is notable.
“Depop is the perfect app for today’s mobile-focused, social-savvy consumers. We discovered the company while it was still incubating at Hfarm and immediately recognised the uniqueness of a founding DNA based on both tech and fashion,” said Roberto Bonanzinga of Balderton Capital in a statement. “Depop is all about the power of its cross-national community and the recent U.S. growth is a superb validation of that strategy.”
If Depop is tapping into a new kind of online shopping experience, where people recommend items, you follow other like-minded shoppers, and shopping is intermingled with a very non-commercial social experience, it’s not alone.
In Europe there are competitors like Shpock and Stuffle. In the U.S. however Yardsale, a Y-Combinator alum, is no longer around, and another competitor called Rumgr was sold on to Close5, which was part of Dutch company Marktplaats, which got acquired by eBay. That points to both the difficulties of launching these platforms — but also the potential interest it can attract from a bigger player if it manages to gain market traction.
This is where Martin will come in. He was with Reddit for six years, and as general manager he was tasked with helping to grow the company, figuring out how to capitalise on what the young company is doing well, and building on that.
“Obviously, Depop and Reddit are very different but what they have in common is that they are very simple on the surface but also very flexible,” he told me. “They both let users define how they use the platform, which is a very simple but powerful idea. When I started at Reddit it was just a link aggregator, but people started making text posts and now that’s a majority of the site. I’ve learned how to recognise patterns and what a user community does with flexible tools.”
Martin, it should be noted, has kept busy in the short rest he has taken between leaving Reddit and joining Depop. He’s been working on a not-for-profit effort called Assholes on Demand, which aims to help people get to the bottom of problems and contact the right person online when something goes wrong with their product or service. Think of it as a Zendesk of last resort. They have a wonderful mission statement:
Assholes on Demand helps people navigate the confusing and frustrating world of customer service and get what you deserve. We’re caring and resourceful assholes* who will help you fight your battles. You’re not alone and you aren’t going crazy.
Hopefully, his two worlds of AOD and Depop will avoid collision: next up for Depop will be tackling some of the age-old problems of any e-commerce operation, problems that have foxed many a marketplace startup. They include figuring out the logistics and shipping behind the service, and how best to scale it while keeping ahold of the community spirit that exists today.
Reistrup says that on the side of logistics, today the service is small enough that Depop leaves it to sellers to work how to get products to buyers, and the distances are not that long, this won’t be the case as they continue to grow.
“We are looking to partner or start building out shipping support because we recognise that if we want to make this a fun and easy way to sell, it’s not fun and easy to wait in the post office,” he says. The types of companies it might work with, he says, include the likes of Postmates or Shyp.