London-based start-up Twig marries fintech and second-hand fashion – WWD

LONDON – The resale market is booming – last month alone, the Vinted resale platform was valued at $ 350 billion while Depop was sold to Etsy last week for $ 1.6 billion – with new players joining the race and changing the rules.

“We don’t even call it reselling, we call it a cash back tool,” said Geri Cupi, founder of Twig, a London-based start-up that allows people to sell second-hand goods. for instant cash.

According to Cupi, the key is to move away from the retail business model and towards a personal finance model, helping people understand that their wardrobe is part of their wealth and allowing them to liquidate the assets they don’t. ‘use more as quickly as possible.

That’s why Twig sees itself as a financial technology company and offers mobile banking benefits including a Visa card that can facilitate domestic and international transactions.

It’s an approach that reflects changing attitudes about ownership and spending habits, especially among the younger Gen Y and Gen Z shoppers who make up Twig’s target audience.

The model is also pushing the resale conversation forward by offering customers instant cash, which will be an irresistible prospect for many. With other resale or rental platforms, people are often forced to wait weeks, or even months, before their parts are appraised, sold or auctioned.

“There has been a tectonic shift in the way people view consumption. They check how much they could resell on an item before they even buy it, and a good portion of the purchases are made by selling older items they own. So consumers already have this mantra of paying for new things using their old things. We just want to streamline the process and allow them to do everything very simply on one platform, ”said Cupi, a former investment banker and venture capitalist who has founded three other upcycling start-ups, resale and blockchain. authentication fields.

“There is a new perception of the objects we have at home and of personal wealth. The traditional definition of wealth does not include the value of a wardrobe. When people thought of their own wealth, they thought of the most important assets they owed, like a house or a car. But with Bitcoin and the tokenization of assets, we’ve started to rethink what money really is, and if a Gucci Marmont bag can help you pay off your mortgage or allow you to travel, then that’s also real money. silver. It’s this whole idea of ​​having a bank of things and using them as the currency of payment.

Getting money from pre-loved items also comes with a bonus for doing good for the planet by supporting the circular economy and preventing those items from ending up in landfill.

Twig works by sending the items sold to its logistics partner to confirm authenticity, and then seeks to resell each item in one of the more than 40 second-hand markets it works with. Anything that doesn’t sell out within eight weeks is either recycled – the company works with more than 1,000 recycling facilities – or donated to charity.

“Our philosophy is that sustainability and capitalism can coexist, the great common enemy being landfill,” said Cupi. “People have thrown away over $ 7 trillion in items over the past 15 years, and it’s having a negative impact on the planet but also on people’s wallets. We want to empower consumers to use us as a banking provider in a way that benefits their wallets, but also the planet.

The opportunity is twofold when it comes to Cupi: Twig can fill a gap that the new generation of banks are not providing by helping users cash in on the fashion items they already own, and offering a big point of difference in the resale experience itself.

The app allows users to download an item within 30 seconds and get an instant price quote, generated by an algorithm that uses machine learning to identify the item’s current market price. Once the person accepts the offer, they get paid instantly, before they even ship the item.

“Right now, if you want to sell an item, there is a lot of friction, the whole process is quite complex: you have to spend time doing market research and listing the item, and then you wait weeks for it. it is sold. Our solution is the fastest way to get paid for your items, ”explained Cupi.

Unlike other resellers who focus on specific market segments, Diem accepts items from the luxury and mass market sectors.

He believes there is a huge crossover in consumer behavior right now, hence Twig’s decision to work with mainstream and mass brands.

“You have a luxury consumer who buys basics from fast fashion brands and you have fast fashion consumers who buy second-hand luxury. Traditional user personas have changed, so positioning yourself is difficult. Our duty is to be as open as possible and to make sure that as few items as possible end up in landfills, ”added Cupi.

New features are also being developed on the app, including a carbon offset tool and a new “payment tool” that will appear on brands and retailers’ e-commerce platforms, to allow users to pay with the app. money earned on Twig instead of dipping into their bank accounts. The company said it is now testing the feature with independent and traditional retailers, with a market launch slated for late 2021.

“It doesn’t get any more circular than that. You can replace your old things with new things, ”said Cupi, adding that from a retailer’s point of view this is an opportunity to become more circular and to get closer to the end consumer as well. “We want to make people’s lives easier and give them the tools to behave in a sustainable manner. “

The company is currently focused on offering these services to the UK market, but expansion into key European territories and the US is also planned for the end of the year, after an investment round of 5.5 million dollars at the start of 2020 from investors. including the Fasanara Capital finance fund; Andrea Molteni, who was one of Farfetch’s early investors, and shoe designer Nicholas Kirkwood.