March 16, 2018- In our feature article, we speak with Julie Wainwright, the founder and CEO of The RealReal, to discuss how she is transforming luxury resale with her online marketplace. She has raised an astounding $173 million in capital for The RealReal, and her vision for the future focuses on extending the life of luxury goods and creating a “circular economy.”
“My mother loved Oriental rugs that were well-worn; she hated new ones. When I was growing up, she would go into homes and ask to buy the rugs from the owners. When I look back, I realize it’s in my DNA.”
– Julie Wainwright, CEO and Founder of The RealReal
We recently had the pleasure of sitting down with Julie Wainwright, CEO and founder of The RealReal, to discuss how she is transforming the luxury resale market, how she raised $173 million in capital and what her vision is for the future of The RealReal.
Tell us about your journey to where you are today. How did you get to be one of the most influential people shaping the global fashion industry?
I came at the concept from a business angle. I was trying to identify an e-commerce business that Amazon couldn’t replicate easily. I also knew that it couldn’t be a third-party sourced product. It had to be something that the competition couldn’t come in and undercut me on. I had an opportunity map and a gap analysis – but no idea for an actual company.
One day, when I was shopping with a girlfriend, she went in the back of a boutique to an area the owner called the vault, and it was all consignment. My friend is a wealthy woman, and I told her that I was surprised to see her shop in a consignment store. She said, “I bought previously owned things in a beautiful environment, and I saved a lot of money. It’s the smart thing to do.” That’s when the lightbulb went off. I went home and looked at my closet, and I had 60 designer pieces that I had never worn or had stopped wearing. That realization changed everything. I thought, “How big is this market? Can eBay do this?” The truth is, if you’re selling luxury goods, you need trust, and eBay’s not set up for that trust.
I decided that my marketplace was any item of value that needed an expert opinion. I opened the business six months after the inspiration struck me. It was that fast, because once I understood where I was going, I knew how to marshal talent and execute.
We’re six and half years old, but it feels like we’re a baby. That’s because at the end of the day, we’re breaking down the old paradigms.
The RealReal started with clothing, but you also carry accessories, jewelry and home items. Did you expect to start with fashion and then expand to other categories?
Yes, always. In order to understand the market, I pulled out my jewelry, watches, art and chairs, and I tried to resell them. I called the art galleries where I had purchased art from the artists. I tried home consignment stores for a couple of chairs. The items cost me thousands of dollars, and I was being offered pennies on the dollar.
I thought, “That’s not right. There has to be a better way to do this.” The truth is, when you’re bound in a brick-and-mortar store, your audience is small. It’s local, and you have space issues, so you always want to move your inventory. Of course, we want to move inventory too, but we don’t want to move it as fast. Read more