OfferUp does not monetize its platform currently. At the end of 2016, the firm had only 100 employees – a very small base for a fast-growing startup of their scale.
The company is also obsessed with employee talent and is selective in hiring. This has allowed the firm to reach the same scale as eBay in half the time. It provided a budget to celebrity blog writers to try the platform and write an authentic review on their blogs. OfferUp employed innovative marketing techniques to rapidly gain scale. Source: Mary Meeker’s internet trends 2016 More users spending more time translate into more listings and a higher probability for people buying the objects posted. An average user spends 25 mins on the app daily – engagement level that rivals social platforms like Snapchat, Instagram. Second, it has a very engaged community that spends a lot of time on the app. First, it has achieved massive scale – 29Mn installations in US. OfferUp has achieved a strong position for 2 reasons. should have many listings and an optimal ratio of sellers and buyers). Marketplaces display strong network effects and need to be “dense” to succeed (i.e.
OFFER UP SITES VERIFICATION
Third, it has very strong background verification process which allows transactions to happen in a safe environment. Second, it has an integrated messaging feature that allows users to complete the negotiation process within the app. OfferUp removes friction from the process as the user doesn’t have to transfer the pictures to his laptop first. Users generally take pictures of objects they want to sell on their phones. OfferUp has 3 clear advantages over competitors like Craiglist. Let us look at its business model that allowed it to achieve a position where it is well poised to capture this value. OfferUp is the largest mobile first player in the used goods space. The image below shows how various firms are competing to capture the value that a used goods marketplace can create : It creates value for the environment also by reducing the number of objects that are sent to the landfill or are thrown away. For buyers, it creates value by providing them with affordable access to things that they need. Secondly, it provides them with cash, which they can use for upgrading to newer items. This is important in cities with high property prices and small houses (like in SF or NYC). Firstly, it frees up space in their homes. “People literally have billions of dollars of value sitting unused and unmonetized in their closets”įor sellers, used goods marketplace creates value in 2 ways. According to Warburg Pincus’s MD Justin Sadrian: However, the size of the used goods market in US is $300Bn (without including used automobile sales). Used goods are not even accounted in a country’s GDP. Used goods marketplace is not a “glamorous” space.
OFFER UP SITES SERIES
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