Rebagg, founded in 2014 and headquartered in New York, is a peer-to-peer marketplace for users to sell their authentic high-end designer handbags. Users simply send handbags into Rebagg and then receive cash for their merchandise. Rebagg does not take any consignment fee when purchasing their inventory. The company only accepts the most stylish bags from the most well known 49 brands and designers including Tom Ford, Chanel, Gucci, Fendi, Dolce & Gabbana, and Louis Vuitton among many others. Rebagg’s inventory is then sold on its sister site Trendlee.
Rebagg Review Breakdown
Co-Founders Charles-Albert Gorra, with education from Harvard Business School, and Erwin Delacroix, with experience working at Google, have a solid foundation, but little entrepreneurial experience. Revenues and expenses are very difficult to estimate for a company like Rebagg and their other website Trendlee. The uncertainty is due to the fact that we do not know Rebagg or Trendless inventory, pricing, and turnover rate, and this information is subject to change at any given time. According to Linkedin, Rebagg has 48 employees, which can help us get a rough estimation of revenue on a per employee basis. If we take the number of employees and multiply by $125,000 and again by $200,000 we get a range of revenues falling between $6M and $9.6M. Seeing as Rebagg had received multiple rounds on investments from well-known VC firms, it is likely that Rebagg is generating revenue that falls in this range.
Competitive Position: There are many 3rd party online marketplaces that buy and sell used fashion merchandise, including the most used and leader in the space, eBay. Rebagg’s most direct competition comes from The RealReal, Poshmark, and Tradesy. The RealReal lists 513 employees on LinkedIn and has raised $123M in six rounds from 19 different investors, including Greycroft Partners and e.Ventures. Poshmark lists 310 employees and has raised $65.5M from SV Angel, Menlo Ventures, and SoftTech VC among others. Lastly, Tradesy has 91 employees and $74.5M in funding. Tradesy also acquired Hop Hers in 2015. These companies all have more funding and employees than Rebagg, which appears to be lagging behind these companies at the moment.
Market Forecast & Exit Indicators
From 2009-2014, VC firms invested heavily in fashion resellers, throwing over $400M at various companies. In 2015 alone, direct competitors Tradsey, The RealReal, and Poshmark raised $30M, $40M, and $25M respectively. Indirect competitors ThreadUp and Vestiaire Collective raised $81M and $37M respectively. Over $200M were raised by these five companies, and that does not include investments in other companies, including Rebagg’s $8M funding round.
In a recent study, The Wall Street Journal claims that “the highest retention of value in fashion is in designer-brand handbags.” Forbes agrees that “the handbag a woman carries is among the most important fashion statements she can make. Even in the tough retail environment, handbags will likely continue to get more than their fair share of wallet.” High-end brands and departments stores could be potential buyers of online marketplaces like the ones mentioned above, but currently, there is nothing in the media suggesting that this will be the course of action in the near future.
Rebagg is marketing to a very niche audience. Their ideal clients that will sell handbags to the company are 35-55 year old women making over $75,000 per year. These women should be living in big cities, and shop at high-end department stores such as Saks 5th Avenue, Neiman Marcus, and Nordstrom. Ideally, these women but 1-2 new handbags per year and read publications like Vogue and “Page 6” in the New York Post. Rebagg also commissions personal assistants and fashion buyers to find inventory for them. The way Rebagg calculates how much to offer a seller is by looking at the original price of the bag, the style, condition, and year of the bag. Then, Rebagg’s internal data on styles and trends, combined with prices on other online marketplaces to offer fair value for the seller. Rebagg’s CEO says their pricing is similar to The RealReal.
Professional & Customer Reviews: The only review for the Rebagg app that I found on iTunes says, “I think they lived up to their promises and I’m super happy that I was paid directly to my bank account just two days after they got my bags. I’ve since used them a handful of times, and I even recommended them to some friends.”. Another review from Bagverify.com says “Rebagg takes pride in the fact that they don’t sell items on consignment – when you sell to them, it’s a hassle-free procedure that allows you to get cash without the wait.”. Finally, a review from Snobessentials.com says, “it was so easy! I requested estimates for bags I haven’t carried in the last five years, and for each one, I received a response within five seconds. For the few items by designers who weren’t listed on the site, I took photos and emailed them to the company. Rebagg notified me immediately to say that they would have the info shortly, and a few hours later, I was sent offers.”.
Users of Rebagg seem to be sold on the ease of use and the fact that there is no consignment fee like when dealing with other sites such as The RealReal.
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