Thursday, October 25, 2012
How Tradesy Makes Selling Women's Clothing Simple, with Tracy DiNunzio
If you're a woman with unwanted--but fashionable--clothing in your closet, which you wish you could sell, what's the easiest way to sell it? It might just be Tradesy (www.tradesy.com), a brand new service which lets women sell their unwanted clothing via a mobile app or website--and even takes care of dealing with shipping and returns. The site is the brainchild of Tracy DiNunzio, who took her experience running RecycledBride.com and is now applying the same concept to women's clothing. Tracy tells us how she bootstrapped her business by renting out both her bedrooms and sleeping on the couch--funding the startup via Airbnb--and is now scaling out the business with a new round of venture capital.
What is Tradesy?
Tracy DiNunzio: Tradesy is a peer-to-peer, fashion marketplace for women. We are making it safer and easier than it has ever been, for women to clean out their closets and earn a bunch of money for their clothing and accessories--things which were previously unmonetized assets. What we've found that, even though eBay users are 47 percent female, and women are making 85 percent of all consumer purchases, most women don't resell their new or gently used clothing or accessories, even though they hold lots of their value. That's because there isn't a product tailored to them. That's what Tradesy is.
How do women use the website?
Tracy DiNunzio: If you're like the average woman, you only wear about 20 percent of your wardrobe. The other 80 percent would be of value to another woman somewhere. What Tradely lets you do, is create a listing in 60 seconds or less, for free. It's as easy as Instagram, and takes no technical knowledge or sales knowledge. You just take a picture, add a few data points, and you're done. That item is then live on Tradesy, and we clean up the image, add some additional data to the listing. We don't put the onus on sellers to describe those items in detail--instead, we use the information we can get from the image and fill it all in for them, which makes it quicker and easier.
Then, once that item sells, we send the seller a prepaid shipping kit. It really couldn't be easier. Shipping is the biggest barrier to entry in this market. For the average person, you don't want to deal with what kind of packaging you need to buy, having to go to the post office, figuring out who pays for it, how much it costs, and so on. We take care of all of that. All our sellers have to do, is place the item in a poly bag that we send them, and give it to the postman. It's literally that simple. We then track the package en-route to the buyer, and when it's been received we release the earnings to them, minus our nine percent commission. The final piece, is if the buyer receives an item and decides they don't like it or don't want it, we take the return. Individual sellers are not equipped to handle returns or return requests, so we actually take those requests at Tradesy with no burden on the seller.
How did you come up with the idea of handling all the shipping details?
Tracy DiNunzio: We came up with it because I've been running RecycledBride for two and a half years. I've really gotten an in-depth education about what women want when buying and selling online. That was one of the first things they asked for, and we wanted to give it to them. It took a lot of work to actually create it, and it was many months in the making and very complex to set up, but it's working beautifully.
Speaking of RecycledBride, how is this all related?
Tracy DiNunzio: RecycledBride and Tradesy are same of the same company, Recycled Media. They are two separate websites, but the same team runs both of them. And, we're now really focused on Tradesy, which is a much larger opportunity for us. RecycledBride was really the testing ground and gave us an education of the ins- and outs- of this market an dhow it works, and gave us extensive user testing. It became profitable in its first year, and we're now taking an established, really successful business model and applying that to the much larger women's fashion market.
You've got a fascinating story behind RecycledBride, I don't know if you'd mind sharing a little bit about your experience there?
Tracy DiNunzio: I started RecycledBride, and I was broke. I had no experience, and no tech experience. The only thing I knew, is that women would both respond to RecycledBride and Tradesy. We launched into bridal first, and gave us a good start in a niche, and let me prove the business model and myself as an entrepreneur. I actually started RecycledBride at my kitchen table, and that's where I've lived for the most of the last two and a half years. I didn't have any funding. I was a painter then, and I started selling all of my paintings to fund RecycledBride. When that wasn't enough, I started using Airbnb to fund the business. One of the key things about our company is the culture, which is very much in the collaborative consumption space. So, I used Airbnb, and slept on my couch and rented out both of my bedrooms, until I made enough money I could focus entirely on the business. I read everything online I could about customer acquisition, marketing, design, and coding, and every part of the business I could. It was a crash course. It was self taught and a long couple of years, and I didn't sleep that much, worked seven days a week, but it worked, and I felt really lucky.
RecycledBride really has become a popular site. What's the secret behind the popularity of RecycledBride?
Tracy DiNunzio: Honestly, hard work. I spent probably the first six months of RecycledBride in creating lots of content. I didn't know anybody in the tech or wedding industry, and I really had to get my foot in the door. The easiest way to do that, was to become a resource for great content. And, rather than reaching out for favors, I thought I'd provide something valuable. Through that, I gained some partnerships, and we were able to build a reputation as an authority in the wedding space. While I was doing that, I was learning about social media, about SEO, about gorilla marketing, and so on. We don't talk too much about it, but part of our secret sauce is how we've been able to develop some insights into marketplace dynamic and customer acquisition. Those proved to be very effective and once we executed was very successful. We're now driving over 1.5 million visitors a month at RecycledBride , and we don't spend anything on acquisition.
Given the success you had at RecycledBride, why raise a round of venture funding?
Tracy DiNunzio: I needed a team. RecycledBride was at a place where I could afford to have one employee and still make enough money to support myself, but in order to build a much larger business for a larger market, and to get the product to where it needed to be, I needed a team. That was the primary reason to raise venture funding. Also, as I was in the process of fundraising, the space became very competitive. I found that we needed to scale more quickly than I first anticipated. Initially, I was just going out to raise a small note, and then decided along the way to go ahead and raise a full Series A, because there was so much interest from investors, and because I wanted to grow very quickly. So, it was mostly to scale the team, and maybe have some capital for acquisitions, as well.
People always compare raising funding and finding investors to the whole process of getting married. You're now quite the expert on marriages. Which one is more difficult?
Tracy DiNunzio: Oh my goodness. Fundraising, definitely. People do compare fundraising to dating, but I had trouble understanding if I was the man or woman in that situation. There's this delicate dance of demonstrating interest without seeming desperate, which is just like dating and relationships. Fundraising, however, is tougher than anyone tells you. I think that's important for other entrepreneurs to know. We all see those companies getting their stories in the media when they close their rounds, and it seems like those fundings are happening every idea. It makes it seem like all you need is an idea and then to go and pitch and raise some money. It's not that simple. It's actually very, very challenging. The upside of that fundraising challenge, is that it makes you a better entrepreneur. You get more people in the conversation, and you get more criticism, and you get more feedback, which gives you better insights into your market. It's a great education process, but it's not an easy task.
Thanks, and good luck!