Resale to the rescue.
Announcing Lightspeed’s seed investment in Archive, the leading e-commerce enablement platform for branded resale.
The $1.5 trillion global fashion industry is remarkably wasteful. In the last 20 years, clothing utilization has fallen by 25% while the number of global units shipped has more than doubled. The fast fashion segment regularly pumps disposable, low quality, low priced merchandise into the market. Much of this product ends up in the garbage (e.g. 86% of shoes are thrown out!) or is sold by the kilogram to lower income countries overseas.
The modern consumer has pushed fashion brands to find more environmentally conscious solutions to this problem, while keeping convenience high and prices low. “Resale” has emerged as the key solution to this problem and has exploded in popularity over the last few years. Secondhand apparel sales in the U.S. alone are now expected to grow to $77B by 2025, up from $36B today. E-commerce resale is a key enabler of this growth.
According to the 2021 thredUp Resale Report (the longest running annual survey in resale), 33M consumers purchased secondhand for the first time in 2020. 76% of those buyers intend to increase their spend on secondhand in the next 5 years. 86% of all Americans have bought, or are open to buying, secondhand, up from only 45% in 2016. Online platforms like thredUP*, Poshmark, Rent The Runway*, The Real Real, GOAT, StockX, and more have introduced millions of consumers to the “circular economy,” and many of these consumers have become regular resale shoppers.
Left out of this ecosystem, however, are the brands themselves. Merchandise passes back and forth between consumers without much involvement from the companies that design, create, and sell it. What started a small fringe market and now become a mainstream behavior, and every apparel brand is now thinking about rolling their own resale strategy. The ethos is simple — brands should be an active participant in the circular economy, not just passersby.
That’s what Lightspeed is thrilled to back Archive — the first operating system for brands to power community resale.
Archive connects a brand’s buyers and sellers directly, facilitating a transaction on its own site. Sellers can choose cash or store credit, the latter of which they can immediately spend back on the brand’s site. Those who choose the latter (75% of users to date) end up spending 3x the amount of the credit they receive, creating incremental revenue for the brand and enhancing customer loyalty. The secondhand inventory provided by sellers on site creates additional entry points for consumers who want to experiment with a brand before leaning into a full price purchase. In these ways, Archive allows these brands to achieve all the benefits of participating in the circular economy, while maintaining a lot more control over the customer experience.
Top brands across major categories have opted into Archive to date. These include Dagne Dover (Almost Vintage), Filippa K. (Preowned), M.M. LaFleur (Second Act), The North Face (Renewed Marketplace), and most recently, luxury fashion house Oscar de la Renta (Encore). More will launch in the next quarter, so stay tuned for all your shopping needs!
We’re excited to partner with Archive co-founders Emily Gittins and Ryan Rowe and the rest of their small, but mighty team. Lightspeed is co-leading the company’s $8m seed round, alongside
at , with participation from our friends at , the founders of , , Warby Parker, and Zola. Alex Bolen, CEO of Oscar de la Renta, Dawn Dobras, former CEO of Credo Beauty, designer Steven Alan, and Marigay McKee, former President of Saks Fifth Avenue, are also joining the round as well.Lastly, Archive is ramping up its hiring significantly. If you want to play an active role in reducing fashion waste and build a key enabler of the circular economy, check out the careers page below!
Alex Taussig is a Partner at Lightspeed in Silicon Valley, a global venture capital firm with over $10B under management. He invests predominately in online marketplaces and is responsible for the Lightspeed’s investments in All Day Kitchens, Archive, Daily Harvest, Faire, Frubana, Outschool, Zola, and more. At his prior firm, Alex was involved with foundational investments in 2U (NASDAQ:TWOU) and thredUP (NASDAQ:TDUP), among others. Alex publishes a weekly(ish) newsletter called “Drinking from the Firehose,” where he shares insights on commerce, media, technology, science, pop culture, and more.
* Denotes a company that I have economic interest in through my personal stock portfolio, Lightspeed, or prior partnerships.
