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This is the $1.6 billion style and social hub for the next generation

Depop CEO Maria Raga explains how the clothing-resale platform became a favorite with young users—and a $1.6 billion acquisition for Etsy.

This is the $1.6 billion style and social hub for the next generation
[Photo: David Vintiner]

Few companies understand what Gen Z wants as well as Depop. The fashion-resale platform has 30 million registered users—and 90% of its active users are under the age of 26. They use the site not only to buy and sell vintage clothes but also to coalesce into different communities based on style, from “cabincore” L.L. Bean-inspired looks to Y2K homages complete with Juicy Couture tracksuits. Maria Raga, who became CEO of Depop in 2016, has overseen the company’s growth and—in June—its $1.6 billion acquisition by Etsy, a move by the e-commerce giant to capture both the burgeoning fashion-resale market and the hearts and minds of younger shoppers. Here, Raga explains how to build a platform that’s authentic.

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[Photo: David Vintiner]

Face your skeptics

Raga began her career as a consultant at Bain & Co. before leaving to work at tech startups: First, she joined Privalia, an early private-sale site, and then the online-voucher pioneer Groupon. Though she enjoyed the excitement of being at these companies during their early years, she says it wasn’t always easy to get people to understand what the startups did: “When you’re doing something new, there are always going to be skeptics—people aren’t used to it; they don’t see ‘it.'”

She faced similar headwinds when she became Depop’s vice president of operations in 2014, at a time when resale was still seen as the purview of thrift shops and flea markets. “Back in the day, it was a bit embarrassing for me to say that I was working in a business that was all about resale. My friends were like, ‘Why would you do that?'” she recalls. “It took a lot of convincing, especially on the investor front. For three or four years, [I was] evangelizing, [saying] ‘Resale is going to be big.'” Today, the secondhand market is worth more than $36 billion and is expected to double within five years.

Play it cool

Depop appeals to younger users, but wasn’t built specifically for them when it launched in 2011. “We have a set of values that happens to resonate quite well with Gen Z,” Raga says. The site encourages creativity and self-expression through its Instagram-esque photo feeds, which allow users to like, comment, and message one another, and taps into people’s entrepreneurial sides by permitting anyone to set up a side hustle—all of which are priorities for Gen Z, according to a recent study that Depop conducted with Bain. (Depop’s resale model also appeals to Gen Z’s interest in sustainability.)

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Having a platform that’s authentic to Gen Z—rather than retrofitted to appeal to them—is key, Raga says. When fashion brands want to partner with Depop, she encourages them to think similarly. For a 2020 Vans collaboration, the shoemaker partnered with leading Depop sellers, who each designed a pair of sneakers and sold them on the site. “It’s all about showcasing creativity or bringing heritage brands back,” Raga says.

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Stay curious

Though she leads a company with Gen Z users, Raga, at 42, is not part of that generation. “I thought that it could be an issue,” she admits. “But I realized that makes me more open-minded, more willing to learn from them and understand how they think—versus trying to build things to my own taste.” To ensure that her company remains tapped into younger users, she invites sellers (in non-COVID times) into Depop’s offices to pack and ship off their items. She also pays close attention to how people are using the platform. One of Depop’s most popular features—the ability for a seller to bundle a number of items into a single sale—came after watching users hack together a less elegant solution online.

Raga says she takes a “community-first mentality” to growing Depop. “It’s a very organic way to grow. You don’t invest a lot of money in marketing,” she says. “So it takes a bit longer, but at the same time, it’s a lot more sustainable. And definitely a lot more profitable.”

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