Thank you, thank you to everyone who came out to our event in San Francisco last night. We had so much fun!
These things are always a little nerve-racking to put together but well worth the effort, and last night was no exception, owing to our wonderful speakers, our sponsors, and our hosts. We’ll have much more on the discussions — with Confide’s Jon Brod, Impossible Foods’s Patrick Brown, and Lightspeed’s Ravi Mhatre and Barry Eggers — very soon, along with pictures and video. (You can catch our interview with The RealReal’s Julie Wainwright below.)
We also want to thank one last time our partners in the event: Square 1 Bank, Rosebud Communications, Bullish, and Haystack. Your support made it much easier for us to do our job last night.
One final note to the generous team at NextWorld Capital: Thank you so much for hosting all of us, and for the second time, no less. We can’t tell you how much we appreciated it.
It’s a long ways off, but if you want to mark it on your calendars, we’ll be hosting our next party on September 27, a Thursday night, in San Francisco. More details to come this summer.:)
(P.S. Sorry for the very short newsletter. Crazed morning. Running out the door. More Monday.)
Top News in the A.M.
The Justice Department has reportedly opened a criminal probe into Uber’s use of Greyball software to evade regulators. Reuters has more here.
Sponsored By . . .
StrictlyVC has been sponsored this week by the Bay Area firm Greenbrier. Scandal; injury; breach; litigation; presidential tweet. Crises can damage your corporate brand, personal reputation, employee morale and have lasting financial impacts. That’s why you need Greenbrier. We provide crisis planning, strategic advice and tactical execution to clients facing complex image, marketing, branding, media, legal and political challenges. With more than 30 years experience predicting, mitigating, managing and building resilience against reputational risks, Greenbrier can help.
The RealReal is Opening a Real Store in New York (and Other News from CEO Julie Wainwright)
At an event in San Francisco last night I sat down with The RealReal founder and CEO Julie Wainwright, who is renowned in startup circles for a variety of things, including her role in winding down the e-commerce company Pets.com during the dot.com era; being one of the bigger personalities in the industry; and launching what’s become one of the fastest-growing consignment startups among a handful that received funding roughly six years ago.
Some no longer exist. The RealReal has meanwhile garnered $123 million in venture funding and says it’s on track to see $500 million in gross merchandise value this year — nearly half of it through the company’s mobile app.
She attributed that success so far to zeroing in on the luxury market, taking possession of consigners’ products and focusing on trust above all else, by ensuring that every item that The RealReal sells to a customer has been inspected and authenticated before it gets shipped out the door. She also said the company is weighing a strategy of opening a series of brick-and-mortar stores, starting first with one New York location that’s currently in the works.
Excerpts from our sit-down, edited for length and clarity, follow:
You’ve raised a lot of money, including a $40 million Series E round last year, but you’re also very much in growth mode. For the VCs in the audience: might you raise another round anytime soon?
No. We’re good for a while.
You started with apparel, but you sold $100 million in watches and fine jewelry last year. Is that now your best-selling category?
The reason we went into jewelry was we were trying to cater to our consigner base, who was saying, “Can you sell this for me? Can you sell that?” And we said, “You can bring in your jewelry and watches; we have a gemology and a watch expert on site.” And it just exploded our business.
You’re talking about valuation offices, which you’ve been launching across the U.S. over the last 18 months. You and I talked about these recently, but they seem to be underreported.
It’s true. We did a little test in Midtown [in New York] around 18 months ago. We now have six offices across the U.S. and soon to be seven. We wanted people to comparison shop because we know you make two-and-a-half to three times more money if you sell your fine jewelry to us. We also wanted to remove any friction. [Jewelry consignment] is sort of weird space. If you’ve ever tried to sell jewelry to anyone else, it’s a pawn shop environment; it’s a little gross. So we wanted to bring the whole process up front, have a discussion with people, and have it be transparent and respectful.
Back to your best-selling items . . .
For men, it’s Rolex. For women, there are three across all age groups: Chanel, Hermes and Louis Vuitton.
Meaning clothing or jewelry or both?
Apparel is our number-one product in unit and dollars.
Are men buying or selling on The RealReal? What’s the gender breakdown?
We actually don’t get enough men’s consignment, so it sells through faster. Twenty percent of our shoppers are men who are shopping for themselves. They’re buying watches, primarily, and leather goods, but also apparel. Their average order size is smaller, but you men [in the audience] don’t like to return things, despite that we have a return policy. So that’s good; it all evens out. [Laughs.]
What percentage of shoppers are also consigning items?
New Fundings
Devicare, a four-year-old, Barcelona, Spain-based maker of remote patient monitoring software, has raised €3 million ($3.3 million) in seed funding from EMESA Corporación Empresarial and numerous family offices. More here.
Outset Medical, a 14-year-old, San Jose, Ca.-based medical device company that makes dialysis machines, has raised $76.5 million in Series C funding led by T. Rowe Price Associates, with participation from Fidelity Management & Research Company, Partner Fund Management LP, Warburg Pincus, Perceptive Advisors and The Vertical Group. FierceBiotech has more here.
Essential Reads
It looks like Amazon’s Video app is finally coming to Apple TV this summer.
Detours
The world’s cheapest cities for a date . . .according to Deutsche Bank(?).
Retail Therapy
The BumpBoxx boom box. (Scientifically proven to win back lost love.)