Introduction to Depop
If you’re someone interested in buying or selling clothes online, then you may have come across Depop. Depop is an online marketplace and social media platform that allows users to buy and sell clothing items.
But it’s not just any marketplace it’s a community of fashion enthusiasts that values secondhand clothing and vintage items. The platform offers a range of features and services that make it unique, including an easy-to-use interface, a direct messaging system, and the ability to follow other users and curate your own feed.
In this article, we’ll take a closer look at Depop and how it operates. We’ll also explore the company’s focus on sustainability, including its stance on using and promoting used clothing and vintage items.
Features and services of Depop
Depop is essentially an online “flea market” that connects buyers and sellers globally. Users can create their own shops on the platform and list their items, which can range from vintage clothing to streetwear, accessories, and even home goods.
The process of creating a listing is straightforward, and sellers can upload photos, description, and price for each item. Buyers can browse through the listings, like items, and save them for later or directly purchase them from the seller.
One of the key features of Depop is its social media aspect. Users can interact with each other, follow other users, and curate their own shopping feed.
This allows users to discover new items, sellers, and trends. The platform also has a messaging system that facilitates communication between buyers and sellers, allowing them to negotiate prices, ask questions, and arrange shipping details.
In summary, Depop’s features and services make it a unique online marketplace that’s both easy to use and community-driven. Depop’s focus on sustainability
One of the things that sets Depop apart from traditional fashion marketplaces is its focus on sustainability.
Depop promotes the importance of reusing and repurposing clothing items, and encourages its users to buy and sell secondhand goods. By promoting the use of used clothing, Depop is making the fashion industry more sustainable and environmentally-friendly.
By purchasing used clothing items, buyers reduce the demand for new clothes, and thereby, reduce the environmental impact of producing and shipping new clothing items. Furthermore, selling used items allows sellers to make money from something that may otherwise be thrown away.
Depop’s commitment to sustainability goes beyond just encouraging secondhand items. The platform has also launched initiatives to support sustainable fashion practices, such as creating a guide that empowers sellers to reduce their carbon footprint.
Additionally, Depop has partnered with organizations that support eco-friendly causes, such as the non-profit organization One Tree Planted to plant trees and help preserve forests.
Depop Company History
Depop was founded in 2011 by Simon Beckerman, an Italian entrepreneur who had previously founded People in Groove, a record label, and RETROSUPERFUTURE, an eyewear brand. Beckerman was a keen fashion enthusiast, and he wanted to create an online marketplace that would cater to the needs of a younger generation of fashion enthusiasts.
The platform was initially launched in Italy, but it soon spread to the UK, the US, and other parts of Europe. Depop’s early funding came from H-Farm ventures, an Italian-based start-up accelerator that helped Beckerman secure seed funding.
The platform’s early days were characterized by its focus on a peer-to-peer “flea market” space, where users could buy and sell secondhand clothing items and vintage pieces. The approach quickly caught on, as the platform grew in popularity, fueled by the growing interest in vintage fashion and sustainable clothing practices.
Over the years, Depop has gone through several leadership changes, with Runar Reistrup serving as CEO from 2016 to 2019 when Maria Raga took over as CEO. Under their leadership, the platform has experienced exponential growth, with the company reporting increasing numbers of active buyers and sellers.
In addition, the platform has secured multiple funding rounds, including a $62 million Series C round in 2019, which was used to expand the platform’s offerings and improve its technology. Depop has also formed partnerships with several brands, including Ralph Lauren, who collaborated with Depop to produce a collection of upcycled designs that demonstrate the brand’s commitment to sustainability.
Conclusion
In conclusion, Depop has become a go-to online marketplace for fashion enthusiasts looking to buy and sell secondhand clothing items and vintage pieces. Its social media aspect and unique features make it stand out from other online marketplaces, and its emphasis on sustainability makes it an eco-friendly choice for fashion-conscious individuals.
With its growing popularity and increasing focus on technological innovation, Depop is likely to remain a significant player in the world of fashion e-commerce for years to come. Depop’s Business Model
Depop is known for its unique business model, which combines the features of an online marketplace with that of a social media platform.
Depop’s primary revenue stream comes from transaction and payment fees that it charges sellers when they make a sale. Depop charges a flat commission fee of 10% on the total sale price, which includes the shipping cost.
The platform also partners with PayPal for secure payment processing. PayPal charges a fee for each transaction, which ranges from 2.9% to 4.4%, depending on the seller’s location and currency.
In addition to earning fees from transactions, Depop generates revenue through advertising. The platform offers a feature called “boosted listings,” which enables sellers to pay for their listings to appear at the top of search results and in other prominent areas of the app.
This feature is a way for sellers to increase visibility and hopefully attract more buyers. Depop also utilizes influencer marketing as a monetization strategy, partnering with power users, who are typically sellers with a large and engaged following, to promote the platform through sponsored posts and other collaborations.
Depop’s social aspect and promotion of small business ownership are also part of its business model. The platform has a large Gen Z user base, many of whom are interested in sustainable fashion and supporting small businesses.
Depop empowers small business owners and individuals to buy and sell clothing items, and its social features, such as the ability to follow other users and create curated shopping feeds, promote peer-to-peer interactions and engagement. Depop Funding, Revenue & Valuation
Since its launch, Depop has experienced tremendous growth and secured multiple rounds of venture capital funding.
According to Crunchbase, the platform has raised a total of $105.6 million in funding, with notable investors including Octopus Ventures, Balderton Capital, and General Atlantic. In its most recent funding round in 2019, Depop raised $62 million, which it used to support its expansion and further technological innovation.
Depop’s annual revenue has also increased significantly in recent years. The platform reported annual revenue of $70 million in 2020, a 200% increase from the previous year.
The company’s valuation has also risen, with the platform recently being valued at $1.6 billion. In June 2021, Etsy announced that it would acquire Depop for $1.6 billion.
The move is seen as a strategic decision for Etsy to expand into the fashion industry and tap in
to Depop’s Gen Z user base. Etsy’s acquisition of Depop will give it sole ownership of the platform and will likely result in increased competition among sellers, as Etsy and Depop’s seller bases overlap.
The acquisition also underlines the continued growth of the sustainable fashion market and the increasing popularity of secondhand clothing. With Etsy’s resources, it’s possible that Depop will continue to grow and innovate under its new ownership, while remaining true to its unique business model.
Ownership and Shareholders
As one of the most popular online marketplaces for buying and selling secondhand clothing, Depop has attracted significant attention from investors and shareholders alike. While the platform’s recent acquisition by Etsy has generated headlines, it’s worth taking a closer look at the ownership and shareholders of Depop, including the stakes held by the platform’s founders and former CEO, as well as its largest shareholder.
Founders and Former CEO’s Ownership Stake in Depop
Depop was founded in 2011 by Simon Beckerman, who created the platform to fill a gap in the market for a more community-driven approach to buying and selling clothing items. Beckerman remained the CEO of Depop until 2016 when he stepped down and was replaced by Runar Reistrup.
Reistrup served as the CEO until 2019 when he was succeeded by Maria Raga. While Beckerman is still involved with Depop, it’s unclear exactly what his current ownership stake in the company is.
However, it’s widely reported that he sold a significant portion of his stake in the company as part of a fundraising round led by General Atlantic in 2019. That round, which raised $62 million, valued Depop at $500 million.
It’s unclear whether Beckerman sold his shares during that round or at some point before then. As for Raga, who took over as CEO in 2019, it’s been reported that she held a 1% stake in the company.
However, it’s not clear whether she still holds that stake following Depop’s acquisition by Etsy. Largest Shareholder’s Ownership Stake and Return on Investment
One of the largest shareholders in Depop is HV Capital, the venture capital arm of German e-commerce company, HelloFresh.
HV Capital led a $20 million funding round for Depop in 2018, which valued the company at $200 million. It’s not clear exactly what percentage of Depop HV Capital owns, but it’s believed to be a significant stake.
According to reports, HV Capital saw a return on investment of more than 20x following Depop’s acquisition by Etsy. Given that Depop was valued at $1.6 billion at the time of the acquisition, it’s safe to assume that HV Capital’s stake was worth hundreds of millions of dollars.
Other investors in Depop include General Atlantic, who led the aforementioned $62 million funding round in 2019, and Balderton Capital, who led a $8.5 million funding round in 2015. It’s not clear how much these investors owned in Depop, or what their return on investment was following Etsy’s acquisition of the platform.
Conclusion
While the recent acquisition of Depop by Etsy has put the spotlight on the platform’s ownership and shareholders, it’s clear that the company has attracted a significant amount of attention and investment over the years. With investors such as HV Capital seeing returns of 20x or more, it’s clear that Depop’s unique business model and growing popularity have made it an attractive investment opportunity.
As for its founders and former CEO, their ownership stakes may be less clear, but it’s clear that they played an important role in building Depop into the platform it is today. Overall, the acquisition of Depop by Etsy highlights the continued growth and importance of the sustainable fashion market, and the increasing popularity of online marketplaces for secondhand items.
Depop’s unique blend of an online marketplace and social media platform has made it a significant player in the fashion e-commerce industry. With a focus on sustainability and a strong Gen Z user base, Depop offers features and services that cater to fashion enthusiasts looking to buy and sell secondhand and vintage clothing items.
The platform’s business model includes revenue streams through transaction and payment fees, boosted listings, and advertising. Depop has attracted significant venture capital funding and has had notable investors, including HV Capital.
The recent acquisition by Etsy highlights the continued growth of the sustainable fashion market and the importance of online marketplaces. Depop’s success serves as a reminder of the increasing popularity of secondhand clothing and the impact of Gen Z in shaping the fashion industry’s future.