ThredUp quietly launches peer-to-peer marketplace

The news: ThredUp is testing a peer-to-peer resale marketplace, per Modern Retail, as it searches for ways to become profitable and shore up sagging revenues.

How we got here: The move is a clear attempt to cut ThredUp’s losses, which ran to $14 million in Q2. Rather than being responsible for storing, photographing, and shipping inventory, the peer-to-peer model allows ThredUp to shift those duties—and expenses—onto sellers.

• For the moment, the resale platform isn’t charging selling fees, which could make it more attractive (in the short term) to sellers who would otherwise be operating on marketplaces like Poshmark, Mercari, and Depop.
• The shift is also likely to increase the amount of inventory available for sale, thereby making ThredUp more attractive to buyers.

The big takeaway: The macroeconomic environment has not been kind to ThredUp. The marketplace struggled to acquire customers in the first half of the year, and had to resort to aggressive discounts to convince shoppers to open their wallets.

Those challenges forced the company to rethink its growth strategy.

• In addition to its peer-to-peer initiative, ThredUp announced earlier this month that it would exit Europe and seek strategic alternatives for Remix, the secondhand apparel company it bought in 2021.
• By focusing on its core US market, and finding ways to lower its operating costs, ThredUp is putting itself in a more favorable position to achieve profitability.