Julie Wainwrite founded The RealReal in 2011. Her inspiration? A close friend who continually bought clothes secondhand at a fancy boutique. This gave Wainwrite the idea for The RealReal. She conducted a quick search and found that the market for luxury items in the United States was roughly $50 billion a year. Next, she went to her own closet to see if she had any items she could sell, much to her surprise she had sixty luxury items that were in sellable condition. She figured, she wasn’t the only one who had items they wanted to sell, so in March 2011, she lauched The RealReal, and by June she was shipping the first purchases. From their but business took off, in the first year, The RealReal did $10 million in sales.
The RealReal is a San Francisco area based luxury brand consignment shop. They sell brands like Chanel, Louis Vuitton, Hermès, Rolex and, among others, Cartier. Individuals who have luxury items to sell, send them to The RealReal. After which, to avoid knock-off items, every item they receive to sell in their shop and on their website, goes through an authentication process to ensure that it is genuine. If it is found to be genuine, then the item will be placed for sale. Most items are sold quickly, in no more than thirty days. Once the item is sold, The RealReal shares the profit with the original seller of the item.
The company is currently trying to raise $100 million in new funding. There could be a few reasons for this new fundraising venture. First, perhaps the company hasn’t reached a point in their success that appeals to public-market investors. Second, the company and its investors may have realized that the market for secondhand luxury items is bigger than they originally thought. Most people would love to own a luxury item, like a Chanel bag, but many of those people don’t want or have the money to spend several thousand dollars to get one. If one thing is for sure, it doesn’t appear The RealReal is going away anytime soon.
Find out more about The RealReal: https://www.nytimes.com/2017/12/13/fashion/the-realreal-consignment-store.html