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Depop

Instagram meets eBay for millennials

Sector: Futurestore
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Depop is the “love child of Instagram and eBay”, a mobile-centric marketplace for second-hand teen fashion, and more. The free app enables consumers to easily sell items by taking a square format image, adding a description with hashtags and setting a price. Buyers and sellers can ‘like’ items, message each other, haggle over prices and share comments, creating a community.

Depop was founded in Milan during 2011 by Simon Beckerman, the co-founder of the culture magazine, PIG, and popular sunglasses brand RetroSuperFuture.

Originally a social network where PIG’s readers could buy items featured in the magazine. After realizing that Depop needed a selling function, Beckerman re-envisioned the app as a global marketplace — a mobile space where you can see what your friends and the people you’re inspired by are liking, buying, and selling.

In turn, your friends and creative influencers all over the world can see the things you like, buy, and sell, and are inspired by you. This ecosystem has supported Depop becoming a global conduit of connection, not only in m-commerce, but culture, design, and creative communities around the world.

“The idea was to attract a whole new generation of young people who could not only use the site to buy and sell in a modern way, but also have fun in discovering what is cool in fashion and design.” Beckerman recently told the FT.

In the short time since it started, Depop’s user-base has climbed to over 10 million, and while it is still widely the realm of teenagers and twentysomethings, an older contingency is also catching on (thanks in part to celebrity participants, including the former basketball star Shaquille O’Neal and the burlesque performer Dita Von Teese — both of whom have Depop stores).

“We have something like 350,000 to 400,000 active users a day,” says Beckerman, “seventy per cent of whom are female, and a majority of whom are aged between 16 and 26.” He says that there are approximately 22,000 sales a day — some made directly online (via PayPal) and some that “allow people to transact by hand”. The company generates its own money by taking a 10 per cent cut of the digital sales, though it does not take a percentage if the seller and buyer agree to meet in person to complete a transaction.

For those unfamiliar with its workings, Depop is a crafty amalgamation of eBay’s entrepreneurial machinations, Craigslist’s lo-fi skeleton and Instagram’s voracious social interconnectivity. The platform is predominantly used through an app, though, like Instagram, it can also be viewed on a desktop. Participation is simple. Vendors post images of whatever it is they’re looking to offload and, when something sells, a tiny yellow “Sold” label appears on the bottom-left corner of the image. Unlike eBay, Depop’s sellers can leave their transacted items on their profiles — creating a curated retail persona that, in time, amasses followers. These followers “like” and comment on products; they can also communicate with vendors independently. Generally, the more followers a seller has, the more lucrative their store will be.

The Depop sales lingo is a millennial art. “Hit me wiv sum offaz [flying money emoji] [money bag emoji] [flying money emoji],” reads the biography on 18-year-old Momos Weighill’s Depop page (@sarweighill). Her profile picture depicts somebody wearing Burberry plaid-trimmed Nike trainers with matching trousers. And her inventory is rife with 1990s and 2000s swag, including a Gucci bikini and sunglasses with coloured lenses — the kind once favoured by Geri Halliwell. Weighill joined the site quite accidentally. “I bought two pairs of yellow and red Versace trousers for £10, but they didn’t fit. I put them up on Depop on the off-chance someone might want them, and they sold for £45 each within three days. I carried on from there.”

For Depop’s users, they boast a consistently hand-curated explore page and are embarking on the brick and mortar retail world with stores in LA and NYC. The business is growing rapidly strengthened community, and continue to add to the brand through a series of collaborations. They’ve worked with major brands like Dickies as well as entrepreneurs like the New York vintage shop owner, Procell, and LA-based textile artist, Uzumaki Cepeda.

In 2018 they launched the IRL to their URL with their version of a brick and mortar on Sunset Boulevard in Los Angeles which actually appears much more like an experiential marketing activation rather than a traditional retail space because it is not just a place for shopping. Moving product is probably its lowest priority. Inside, app users can attend workshops centered on improving their Depop stores like how to style fashion and lifestyle photos, source vintage, brand building and other skills to help use their account like an entrepreneur. They can also shoot photos of their products there or book time with the in-house team to shoot it for them.

It was here their collaboration with Cepada became an experience in addition to selling her art in-app. Cepeda’s art is rooted in creating her interpretation of safe spaces through utilizing brightly colored faux fur. For the event, she did a set design that attendees were able to shoot photos in. They also celebrated Go Skate Day with the Dickies Girls. “There was a custom skate ramp in the parking lot and Dickies Girl launched their Depop shop with some fun new merchandise which was available for sale throughout the space.”

Update 2018. Extract from Courier interview with Maria Raga, now CEO.

Just inside Depop’s front door, there’s a 1960s-esque counter on the wall; every few seconds the numbers tick over, clocking up yet another sale on the mobile app since midnight. When Courier visits, mid-afternoon, it reads 8,094.

But nobody is paying the ticker any attention. There’s a baby in the office, and she has attracted quite a fan club. A gaggle of software engineers, stylists, accountants and strategists have gathered around her pram for some communal cooing.

Many of Depop’s nine million users are closer in age to this baby than her parents: 80% are under 25. They’ve also mastered a very different way of making money to the proverbial paper round – some entrepreneurial teens are earning thousands of pounds every month hawking their unloved trainers, mums’ vintage jackets and last season’s sweaters. It’s this generation’s Ebay, completely changing the way millions buy and sell things – and it’s cool.

Users love Depop because it’s more than just a way to make extra cash; it’s also a social network. The app looks more like Instagram than Amazon, with feeds filled with photos of fresh-faced teens posing in clothes in their bedrooms.

And it has global appeal. Worldwide sales hit £170m in 2017, and the US is fast closing in on the UK as its biggest market. No surprise then, that when the company announced its latest £14m investment round in February, it promised to head state-side soon.

Tough times

There was a time, though, when things weren’t looking so rosy. When Maria Raga became CEO in early 2016, the company’s founder and creative compass Simon Beckerman had recently left after a disagreement with the board. Staff were also heading off, fast – and there was the small matter of a £6.5m fundraising round to close. ‘It was a bit tricky,’ says Raga, a fast-talking Spaniard who joined Depop in 2014 as chief operating officer, via Insead business school in France, Bain consultancy and Groupon.

When the storm came, the board elected her CEO. Somebody more used to suits than sneakers, Raga suddenly found herself at the helm of a creative company which had, in essence, lost its way.

‘There was a lack of a unified vision for the business, and people started to not believe,’ she says. The business had grown faster than the team behind it, and the stretch marks were starting to show.

It’s been quite the turnaround. How, then, did Raga do it?

Re: vision

Like any experienced strategist, she started by defining the company’s mission – and immediately ran into difficulties. ‘How was I supposed to come up with a vision when I didn’t found the company?’ she says. ‘It’s one of the toughest things [to do] when a business is already up and running, because there’s something that people believe in, but it’s not properly articulated.’

So she took a risk and brought back Beckerman, the founder, as creative director. Before starting Depop in 2011, he launched pop-culture magazine Pig in his native Italy, and Retro Superfuture, a sunglasses brand made famous by the likes of Kanye, Lady Gaga and Beyonce. (‘These ones are actually his brand’s,’ says Raga, pulling off a pair of thick-rimmed, oversized frames.) Raga didn’t need to beg: Beckerman was eager to come back. ‘Now it doesn’t even feel like he left the company,’ she says. The combination of the two of them, one investor says, is Depop’s ‘magic ingredient’.

Two years on, Beckerman remains heavily involved, poking his head around the door mid-interview to ask Raga a quick question. ‘We sit down multiple times a day,’ he says. ‘Maria’s a super pragmatic person. She’s able to download my brain and make it more structured.’

If Depop were a car

With Beckerman back onboard, Raga’s next step toward defining the vision (and pulling the company back together) has become a signature trait of her management style. She asked questions – of her team and her users: ‘We wanted to understand what people thought about us. So, if Depop were a magazine, what kind of magazine would it be? If Depop were a car, what type of car would it be?’ The answers were all over the place – from high fashion titles to Hello! magazine.

A branding agency was enlisted to help pin down Depop’s personality and a defined mission was identified: ‘To empower creative minds.’ A new version of the app was launched shortly after.

Having a clear idea of what the brand is and where it’s going has helped define which users to go after, hone marketing strategies and work out where to focus expansion efforts, says Raga. More than anything, she says, it’s helped her decide what not to do. She’s wary, though, of merely bandying the mission statement around – ‘if you just put the sentence on the wall, that doesn’t work’ – and says for it to have any impact, every decision must be made in relation to it.

Selling state-side

Depop’s biggest move yet was its expansion into the US last month. Over a third of Depop’s users are already based there, but haven’t yet had a physical touchpoint with the brand.

That’s all set to change now that 3531 West Sunset Boulevard, Depop’s first pop-up retail space, has opened in Silverlake, LA. ‘To be creative, people have to connect, to get inspired by others,’ says Raga. Depop’s app is inherently social – users build networks, start conversations, follow and refer one another. The hope is, if users also meet in person, their devotion will be further strengthened.

Calling the LA site – and the New York space that will follow in April – ‘pop-ups’ sells them short; they will double up as offices for local customer support and partnerships teams, while also giving users a space in which to sell products, take photos, host events and workshops.

It’s not an untested idea: in a less formal way, Depop has been meeting its users in person for years. They regularly visit the Shoreditch HQ for everything from photography workshops to lessons in how to spot a fake, and feedback sessions with staff over pizza. The only reason these events haven’t been open to the wider public, Raga hints, is a practical one: Depop is based on the fourth floor of a converted warehouse – and the lifts are highly unpredictable.

Any questions?

Raga, too, likes to meet Depop users, inside and outside the office – and sometimes in unlikely locations. Recently, she was invited to speak at Eton (the schoolboys are apparently big Depop users). She turned up with a handful of merchandise and promised prizes for the best questions asked. The 14-year-olds impressed her: ‘They were asking us when we are going to use blockchain.’ Although she says 2018 won’t be the year Depop moves into blockchain, 38-year-old Raga seems like somebody who’s always up for trying out something new.

When we meet, she’s wearing a second-hand Acne jacket recently bought from Depop – much to Acne-fan and marketing strategist Tainá Vilela’s delight. Speaking of her boss, Vilela says: ‘Even though we are two worlds apart – she comes from a very corporate background, and I come from a creative background – she’s always trying to find points where we can connect and communicate. She’s always interested in understanding things better.’

With the company too, Raga’s open to experimenting with what might seem like tech world clichés. Depop’s people team have introduced several initiatives to help staff across departments get to know each other. ‘We have this “buddy-up” thing, which is hilarious,’ Raga says, raising her eyebrows: people who might never usually speak to one another are given a small budget to hang out. Although clearly sceptical of the initiative at first, she says: ‘You may think it’s a waste of time, but it does make a difference.’

This openness has filtered through the company. Vilela, who’s worked with Raga for three and a half years, says: ‘I can go to someone and say, “Why don’t we do something this way?”’ It’s been a very deliberate cultural shift.

Since becoming CEO, Raga’s expanded the leadership teams, and ‘put a lot of emphasis on people’s roles’: she didn’t want the mass exodus the company suffered in early 2016 reoccurring. She regularly sends emails with company updates, quarterly reports or even to explain crises. There are ‘all-hands’ meetings where the whole team gathers, and on Fridays at 5pm, people from all departments start drinking beers and playing video games together. It would’ve been an improbable scene back in early 2016.

‘Maria’s very lovable,’ says Beckerman. ‘The team loves her and she always works with them in the same direction.’

‘She’s grown the trust and the loyalty of the whole of the business,’ echoes Rebecca Hunt, an early stage investor at Octopus Ventures, and the latest member of Depop’s board. Hunt’s known Raga since before she became CEO, and has seen her grow with the role. ‘She took over in difficult circumstances, and she’s shown herself to have a high degree of emotional intelligence.

‘She also has a huge amount of humility – she has no idea how good she is. She calls at the end of the month, says “Sorry we’re half a percent behind our numbers,” and I just want to kiss her.’

1,000% growth

In the boardroom, though, Raga has to play hardball. Some investors have pushed for the app to introduce paid-for features, such as one which would bump paying users’ profiles to the top of a page. Introducing this, though, would tamper with Depop’s ‘drop page’ – a list of what’s trending and profiles Depop’s team have curated. ‘The moment you start allowing people to promote themselves by paying, that’s completely diluted,’ says Raga. ‘One of the things that makes Depop very special is the curation side of things.’ It’s a dilemma currently without an answer.

‘There’s a lot of emphasis on putting a lot of money into marketing and growing the business fast,’ adds Raga. ‘I’ve learned to be comfortable with saying, “You don’t have to go from 100% to 1000% growth”.

‘I don’t think you have to grow fast to be successful, and when you’re building a marketplace that has a lot of emphasis on community, it has to be done in a very credible and authentic way. I’m very happy growing 100% year-on-year, so why push it?’

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