SidelineSwap expanded beyond its marketplace by launching a trade-in program with Dick's Sporting Goods. The company discovered two types of sellers: DIY sellers who want control and convenience sellers who want simplicity. Owning inventory helped them improve unit economics and get the marketplace flywheel spinning.
Chapters
So if we kind of go back, you know, how did you think about like initially kind of launching that or kind of rolling it out as a marketplace? And I guess if we kind of like fast forward to today, you know, what have been some of the biggest learnings from it so far?
It was kind of always in the back of our mind that if we got far enough along, like it's hard to build a marketplace. And so I think it's hard to do all this at once and you kind of had to pick which one are you going to go after. And we obviously picked the pure-play marketplace to start. But we always felt like there was an opportunity to build this second part of the business. So in 2019, I hired a VP of partnerships who had spent a lot of time in the used golf space. We started talking through some of these ideas of like what this could look like in our business model. We started conversations with retail partners and gained some momentum with Dick's Sporting Goods. And so we started with a single pop-up event. We ran a pop-up event in Livonia, Michigan, with a hockey store. And set up at 10 a.m., no idea if anybody's going to show up. And, you know, before we're even done setting up, people are getting out of their cars with bags full of equipment. You know, can't believe you guys are here. This is amazing. We love this. And, you know, I've been to probably over 100 trade-in events in the last 2 years all around the country. It's been really cool. I mean, it really validates what we believed was out there, that there's a ton of, a ton of inventory in people's homes. They just want an easier way to sell it. So started with one pop-up event, then we had to like refine the playbook. We did 14 events last spring, we did 50 last fall, and then we did 500 this year. So, you know, that was kind of refining the playbook, figuring out how to make this whole thing work. And I think like there's a ton of learnings, like the last 2 years for us have been, have been crazy. But I think The, the main things are that there's, you know, I do think there's 2 types of sellers out there that, you know, there's people who want to do the work and earn as much as possible. You know, we have, you know, for them, that's the Poshmark model. We support that. I think the other, you know, there is a ThredUp seller who just has really good stuff but doesn't want to do the work to sell it themselves. And so you can give that person less money Right. And they're going to earn less by not having to do any of the work. But you can get that and sell it at higher margin and run that business efficiently. And, you know, those two can, can both feed the demand on the marketplace. Yeah. And I think like the, the other, maybe one other like interesting learning from as the, as the business has evolved is that sometimes it can be challenging as a marketplace to compete against retailers who have much higher margin. Like we don't think about, so we spend a lot of money on performance marketing. We don't compete just for used terms. If someone's shopping for hockey skates, we want them, even if they're shopping for new, we want them to consider used. And, but you're competing against a retailer who has like 40, 50% plus margin where you're taking 10%. And so like sometimes that could be a challenge, but by owning some inventory, it can be helpful. To create a more level playing field as you're getting the flywheel going. So that's been an, yeah, a benefit of the evolution in our business is that it allows us to think about our unit economics a little bit differently on the marketing front. There's a lot more, but I'll kind of pause there for now.
