An app that lets women buy and sell clothing, shoes, and accessories from their phones has raised US$11m in Series A funding to help scale its business.
The funding, led by Index Ventures, will enable San Francisco based Curtsy to scale, build out its team, and continue to gain market share by simplifying resale for the casual seller. It brings the total raised to date of $14.5m.
“The giants in the clothing resale space have been around for a while and haven’t done a great job appealing to casual sellers or keeping up with the times,” says co-founder David Oates. “Most apps focus on closet cleanout, ignoring the Gen Z use case of rotating their wardrobe.”
Curtsy was founded as an app for women in sororities to rent dresses from each other. After a successful first semester at Ole Miss, Curtsy applied and was accepted to the Y Combinator seed money startup accelerator.
The company quickly expanded its presence in campuses across the country and launched shipping to allow rentals between schools in early 2018. The team realised that the most requested feature – to buy and sell clothes instead of just rent – was the bigger opportunity.
The app has grown ten-fold since 2019 and is facilitating tens of millions of dollars in transaction volume, the company says. In October 2020, Curtsy facilitated the sale of 85,000 items, an increase of 35% since September.
“Consumer-to-consumer e-commerce, first pioneered by eBay, continues to be unbundled. Dedicated platforms are rising that have a tighter relationship with their users and that facilitate more frictionless ways to transact a certain type of good,” adds Damir Becirovic of Index Ventures.
“Curtsy has accomplished exactly this for young women and their desire to buy and sell clothing. Never before have we seen such a strong overlap between buyers and sellers on a consumer-to-consumer marketplace. We believe the incredible love for Curtsy is indicative of a large marketplace in the making.”
The company focuses on Gen Z women, aged 15-30, who it believes are the fastest growing segment in the space yet are underserved by the major players. They buy 60% more clothing than previous generations, but keep them half as long.
However, despite the proliferation of resale apps over the last decade, 20 million tons of clothing still end up in landfills each year, it says.
In part, this is because existing clothing resale apps demand a lot of work from users, who have to figure out how to best merchandise and price their items, grow their audience, and manually fulfil orders. As a result, they are primarily used by professional sellers.
Curtsy uses machine learning and human review to simplify selling in order to win casual sellers and unlock their closets. When sellers list items, it recommends a price and autofills details, like category and brand, to reduce errors. Before items are shown in the app, Curtsy improves the images, fixes issues with the listing, and removes spam.
These steps have the effect of standardising listings across sellers, which helps improves the shopping experience, it explains.
It also removes the friction from order fulfilment by providing Curtsy-branded shipping supplies that sellers can use to package their items from home. The app helps schedule a free USPS pickup, so sellers don’t have to drive to the post-office. Buyers can also resell items purchased on Curtsy with one-tap, without having to photograph or describe the item again.