EBay takes a bite at StockX and GOAT with sneaker authentication for sales $100+ in the US

EBay is announcing today that it’s going to start authenticating sneaker sales over $100 in the U.S. This is a clear bite into the dominance of StockX and GOAT in the limited sneaker universe.

The authentication will be done by Sneaker Con, the company that runs, well, Sneaker Con. Founded by Yu-Ming Wu and Hayden Sharitt, Sneaker Con was infused with cash by Visionary Private Equity Group in 2018. They provide a well known and influential backer in the sneakerhead community that should provide a solid signal for buyers and sellers. It’s a good choice.

The quick story here is that eBay’s rep for authentic merch is, uh, not great — especially the sneaker universe, where fakes can be virtually indistinguishable from authentic items. Though the brands themselves have toyed with different ways to authenticate, from NFC tags to blockchain solutions, the counterfeiters have kept up with those various methods too and clone them quickly. About the only way to guarantee authenticity is to get the product in hand and have them examined by people trained to spot fakes. In some cases that spotting can be as granular as counting the number of stitches thrown in between two segments of a shoe, or observing the glue pattern of a midsole joint.

The program sounds pretty much the same as the others on the market:

  • Proof of Authentication: Upon receiving the sneakers, the independent authenticator confirms they are consistent with the listing title, description and images, and then performs a multi-point physical authentication inspection. An eBay tag, guaranteeing its authenticity, is attached to the sneakers to finalize the process, driving confidence in the collectability and resale value.
  • Third-Party Authentication: EBay has partnered with industry leader Sneaker Con to create a new state-of-the-art facility — leveraging the top authenticators in the industry, a robust checklist of product specifications and best-in-class processes to ensure accuracy and efficiency. With rigorous inspection of the box, shoe and accessories, the authentication underscores eBay’s commitment to giving shoppers exactly what they want.
  • Verified Returns: For sellers who choose to offer returns, eBay’s sneaker authentication program ensures the exact item initially sold is returned to the seller, via a verified returns process. Returns are shipped back directly to the authentication center, where the third-party experts verify each item and its condition before returning to the seller.

EBay’s reluctance to spin up a person-in-the-middle authentication program allowed a gap for StockX and GOAT to thrive, offering authentication for new and, in GOAT’s case, even pre-owned sneakers. The eBay authentication tags even look like those offered by the two players. EBay had already launched its Authenticity Guarantee for watches over $2,000 (StockX also sells watches).

The power of authenticity, of course, is what drives the booming secondary market, where shoes can be limited to thousands of pairs or even dozens of pairs per release. Sneaker culture, which was born on the basketball court and driven largely by Black athletes, musicians and icons, is now squarely mainstream and very big business. EBay has been slow to move here but has significant resources and already does brisk sneaker business, with 6 million sneakers sold in 2019.

One note here is that this may drive higher margin business for eBay because higher-end sales in the $500+ range are harder to justify on eBay where authenticity was not guaranteed. EBay was likely already capturing a decent portion of the lower-end market, but now has a chance to grab some of the fattier meat.

StockX and GOAT have advantages still, even with authentication now a commodity feature. They are purpose-driven with a collector in view, and they have significant mindshare in the community. But if eBay is able to rescue its reputation for questionable sneaker transactions (I was once shipped a pair of socks and a literal brick in an eBay transaction gone bad) and incredibly poor seller support (eBay sides with the buyer in the vast majority of disputes, even obvious con jobs) then it could pose a serious threat here.

My hope is that the faster movers here will take this as an opportunity to really revamp their product experiences. Both StockX and GOAT have been relatively stagnant on the app and website front for a while, offering some intriguing yet incremental innovation — but not dramatically overhauling their product.

The Little Black Door app makes luxury wardrobes shareable, resalable, and sustainable

When Lexi Willetts and Marina Pengilly realized they could make as much as £30,000 a year reselling their luxury clothes and accessories online, they resolved to create a solution for modern women who are already well-versed in the behaviors of Instagram and the sharing economy. Their solution, Little Black Door, has just gone live on the iOS store, and allows women to see, style and share their wardrobes with friends and followers. It also connects them to resale platforms, unlocking a vastly more environmental-friendly and sustainable way to shop for high-quality fashion. And with the COVID-19 pandemic hitting the fashion world, the app is set to benefit, as consumers head to the re-sale of luxury, rather than new items.

As Willetts puts it: “This started as a response to our own bad wardrobe behaviors. Our overbuying often because we forgot what we had, often thinking to buy rather than borrow from friends. Plus, we saw the headache of creating resale listings. Realizing that so much of our interactions were online, thus producing very rich e-receipt data, we set about thinking of how we could make use of that to create better wardrobe engagement and reduce our overbuying of irrelevant, cheap fashion.”

The problem with platforms like this has always been: how to digitize the wardrobe in the first place. Most people can’t be bothered to go to the trouble. But this app takes a fresh approach. It concentrates on using wardrobe purchase data and leveraging social sharing behavior to more easily create a digital wardrobe. It also allows the wardrobe to be connected with retail, making it far easier to start the resale journey of selling unwanted items.

The resulting LBD app appears at first to be a sort of ‘Instagram and Depop’ mashup. Users add items to their virtual wardrobe which then employs image recognition AI and natural language processing to figure out what the item is, and tries to categorize it as well. It checks with the user if something is a t-shirt, black, short sleeve, minimalism, urban casual, etc. before it’s confirmed into the wardrobe.

But perhaps more interestingly, the LBD app will ingest receipts of items purchased via email. This means the wardrobe can be built up from new or existing data the user already has. Once the wardrobe is built inside the app, the user can see the clothes and categories, their total wardrobe spend, and create “lookbooks” which they can share with friends and followers to comment on. Friends can then borrow items or users can send items to resale via the ‘swipe to sell’ feature.

Most other wardrobe apps haven’t created a ‘viral loop’ whereby the user is incentivized to use the app daily. LBD has added social features to create a community-driven platform that is almost like an ‘Instagram for fashion’.

Previous ‘wardrobe apps’ like this have obsessed over whether the app can recognize clothes or not, but most don’t work well. The better use of AI, as LBD has realized, is to use receipts data and purchase histories, plus retail partner links, to add to wardrobes. This means the wardrobe upload feature isn’t the primary focus, as it is trumped by wardrobe item data. It’s on this basis that they can create more useful and – crucially – playful features.

“We’ve designed features to entertain and engage the user relating to their wardrobe. We create ease of sharing with friends, tapping into the sharing economy mindset… Moreover, the app is designed to build a culture of conscious consumption, encouraging users to buy less ‘fast fashion’, invest in quality pieces, and wear and share the contents of their closets,” says Willetts.

So the app is interesting, but what about the business model? Effectively, LBD is creating a data play around women’s wardrobes. They could use the data to create advertising for relevant and sustainable brands; partnerships with retailers; value-added services; a resale platform with commissions; verified sellers; and a premium version for high-end users with high-end wardrobes.

LBD is hitting four key trends. The rise of resale (see Real Real, Depop); the rise in sharing wardrobe behaviors (rentals like Rent the Runway, Hurr); the rise in the use of AI in e-commence; and the rise of re-receipts and online sales.

The fashion market is big. The global clothing and apparel market is worth $758.4bn and is over 50% female. But although that market has been hit by the COV-19 pandemic – as people needed to dress up less during lockdown – it is recovering, and now with a client base far more aware of the issues of sustainability. So LBD is set to benefit from that general ‘re-set’.

And, in the coming recession, it will be cheaper to shop second hand from sellers you have an insight into (your friends) as well as selling items to re-sale. For retail partners, they get better data on what consumers really do within the privacy of their wardrobes, allowing them to produce and sell more relevant and more targeted collections, reducing inventory waste, and generating a positive environmental impact.

Bolt Threads partners with Adidas, owners of Balenciaga and Gucci, and Stella McCartney on mushroom leather

Bolt Threads has brought together some new and existing partners including Stella McCartney, Kering (the fashion house behind brands like Balenciaga, Gucci, Alexander McQueen and Bottega Veneta), Lululemon and Adidas to create a consortium that will explore the company’s use of mushroom-based leather substitute in products, the company said.

These companies will be among the first to bring products made with Bolt Threads mushroom-based leather substitute to market in 2021, the company said.

“I have always been convinced that innovation is key to addressing the  sustainability challenge that luxury is facing. Finding innovative, alternative materials and fabrics can potentially drastically reduce the environmental impact of our industry over the long term,” François-Henri Pinault, the chairman and chief executive of Kering, in a statement.

The announcement is the culmination of at least two years of work from Bolt Threads, which first announced it would join the hunt for a leather substitute in 2018. The company announced its first product soon after — a $400 “Driver Bag” designed in conjunction with the Portland-based bag company, Chester Wallace.

The company, which has raised over $200 million since its launch nearly eleven years ago, faces some pretty tough competition. Companies like MycoWorks and Modern Meadow both have alternative leather products in the works. However, these partnerships may go a long way toward separating Bolt from the rest of the herd.

Swatches of Bolt Threads mushroom leather product, “Mylo”. Image Credit: Bolt Threads

Investors in Bolt Threads include Foundation Capital, Baillie Gifford, Founders Fund, Formation 8, and the Nan Fung Group, a privately held, Hong Kong-based conglomerate with significant holdings in the textile and fashion industry.

What the redoubled interest in leather goods means for the alternative spider silk that was the company’s original product is unclear. There hasn’t been much news on the silk front since the company debuted its $314 necktie back in 2017.

There’s clearly interest in the fashion industry’s ability to clean up. Consumers are demanding it and new brands focused on sustainability are launching regularly.

As Reducetarian Foundation president and co-founder, Brian Kateman, wrote last year, “traditional fashion is killing the planet.”

Every year, the textile industry alone spits out 1.2 billion tons of greenhouse gases — more than all marine shipping vessels and international flights combined — and consumes 98 million tons of oil. Textile dyeing is the second-largest polluter of clean water, and on the whole, the apparel industry accounts for 10 percent of all greenhouse emissions worldwide. Worst of all, the clothes produced by this massive resource consumption produces clothes are rapidly discarded: In 2015, 73 percent of the total material used to make clothes ended up incinerated or landfilled, according to a study by the Ellen MacArthur foundation.

Amazon launches a $4.99-per-month ‘personal shopper’ service for men’s fashion

Amazon is introducing a personal shopping service for men’s fashion. The service, now available to Prime members, is an expansion of the existing Personal Shopper by Prime Wardrobe, a $4.99 per month Stitch Fix rival, originally aimed at women. With Personal Shopper by Prime Wardrobe, an Amazon stylist selects an assortment of fashion items that match a customer’s style and fit preferences. These are are then shipped to the customer on a monthly basis for home try-on. Whatever the customer doesn’t want to keep can be returned using the resealable package and the prepaid shipping label provided.

At launch, the new men’s personal shopping service will include brands like Scotch & Soda, Original Penguin, Adidas, Lacoste, Carhartt, Levi’s, Amazon Essentials, Goodthreads, and more — a mix of both Amazon’s own in-house brands and others. In total, Amazon says Personal Shopper by Prime Wardrobe will offer hundred of thousands of men’s styles across more than a thousand different brands.

The service itself is similar in many ways to Stitch Fix, as it also starts customers with a style quiz to personalize their monthly fashion selections. Also like competitive fashion subscription services, customers can reach out to their stylist with specific requests  — like if they need a professional outfit for job interview, for example, or some other occasion where they may want something outside their usual interests.

But unlike Stitch Fix, which charges a $20 “stylist fee” which is later credited towards any items you choose to keep, Amazon’s personal shopping service is a flat $4.99 per month. Another difference is that the Personal Shopper service will alert you ahead of your shipment to review their picks. You then choose the up to 8 items you want to receive, instead of waiting for the surprise of opening your box.

Image Credits: Amazon

Before today, Amazon had offered men’s fashion in its try-before-you-buy Prime Wardrobe product selection. But that service simply allows Amazon Prime members to request certain fashion items for home try-on, instead of paying for them upfront then returning what doesn’t work. To date, Prime Wardrobe’s biggest drawback has been that many of the fashion items found on Amazon aren’t eligible for home try-on, particularly many of those from the most in-demand brands.

However, Amazon claims it doesn’t stuff Prime Wardrobe with only its own brands. The company says less than 1% of its total selection of brands within Prime Wardrobe are Amazon-owned. (Of course, that percentage may be higher in the boxes customers receive from their personal shopper, at times.)

Amazon also says millions of customers have used the home try-on option provided by Prime Wardrobe and   “hundreds of thousands” of customers have created fashion profiles within Personal Shopper by Prime Wardrobe since its 2019 launch.

However, only “tens of thousands” of customers today use the Personal Shopper service on a monthly basis.

That means Prime Wardrobe is no real threat to Stitch Fix at this time, if making a comparison purely based on number of paying customers.

StitchFix has had longer to perfect its model and refine its insights which has allowed it to grow its active client base to 3.5 million. That figure is up 9% year-over-year, as of the company’s latest earnings reported earlier this month. More recently, Stitch Fix benefited from the pandemic — after it got through its initial backlogged orders — as customers sought to change their style from businesswear to activewear.

Men’s activewear had been particularly in demand, which is perhaps a trend Amazon had also seen ahead of the launch of its new service.

While home try-on via Prime Wardrobe is available today in the U.S., UK, Germany, Austria and Japan, the Personal Shopper by Prime Wardrobe subscription is currently available in the U.S. only. It’s also only available on mobile devices.

 

Fashion brand SockSoho is using data science in a bid to become the “Uniqlo of India”

SockSoho co-founder Pritika Mehta with some of the company's socks

SockSoho co-founder Pritika Mehta with some of the company’s socks

SockSoho is a direct-to-consumer brand that aspires to become the “Uniqlo of India.” The company launched sales ten months ago, starting with men’s socks, and recently completed Y Combinator’s Summer 2020 program. Founded by Pritika Mehta, a data scientist who has worked at companies including TripAdvisor, and growth marketer Simarpreet Singh, SockSoho now has more than 30,000 customers, and plans to launch into new menswear verticals soon.

Before launching SockSoho, Mehta and Singh worked together on MindBatteries, a technology and content IP provider whose corporate clients have included The Times of India, The Economic Times, Mercedes, Infosys, the World Economic Forum and Uber.

The two are relying on several factors for SockSoho’s growth: India’s position as one of the largest and fastest-growing e-commerce companies in the world and the company’s in-house technology, which will include proprietary chatbots and AI-based recommendation engines as it scales.

SockSoho launched with a multi-platform distribution strategy, selling on its on site as well as ecommerce platforms. But its main driver is WhatsApp, the most popular messaging app in India with over 400 million users. About 70% of the SockSoho’s sales happen through WhatsApp, and it also uses the messenger for marketing and A/B product testing.

Eric Migicovsky, the Y Combinator partner who invested in SockSoho, told TechCrunch in an email that SockSoho “looks like a fashion brand on the surface but at the backend they operate like a tech company. They’re A/B testing every aspect of the product and ecommerce path, not something every fashion brand does.”

“I think they’re winning strategy here is WhatsApp,” he added. “They have figured out how to acquire and service customers exclusively through the platform.”

One of SockSoho's gift boxes

One of SockSoho’s gift boxes

Before starting SockSoho, Mehta earned a Master’s in computer science from the University of Buffalo, focusing on artificial intelligence. Then she spent several years in the United States, working at tech companies including TripAdvisor. But she continued keeping an eye on her home country.

“When I saw the growth happening in the Indian market, it looked phenomenal because the population is huge and data was becoming really cheap. There was a huge increase in people shopping online,” she told TechCrunch. “That is when I thought, what the hell am I doing in the U.S. when all the action is happening in India?”

Most online fashion brands in India focus on women, so Metha and Singh decided to go into menswear. They say there are about 200 million men living in cities in India, representing a potential $8 billion market. Before doing consumer research, the two wrote down a list of 80 items they could launch with. Socks won because they are easy to fit and ship, and have high margins and low rates of return.

Before launching new socks, SockSoho does its version of A/B testing through WhatsApp by sending design ideas to customers and gauging their interest in pre-orders before placing manufacturing orders.

Data analytics is key to reducing the cost of marketing and customer acquisition, a challenge for many direct-to-consumer companies.

“We are basically gathering data points to understand customer behavior and spending patterns, and those insights help us refine every single thing that we are building, from our designs to marketing and inventory planning, and even expanding into future verticals,” said Mehta.

Analyzing data has already revealed a couple surprises. For example, SockSoho expected almost all of its customers to be men, but about 30% of total purchases are made by women buying gifts. SockSoho’s founders also assumed that most of its buyers would live in major cities like Delhi, Mumbai and Bangalore, but its data revealed that smaller cities were major growth drivers. “All these insights came purely from data,” said Singh.

Over the last six months, 15% of SockSoho’s customers have made repeat purchases, and sales grew during India’s COVID-19 lockdown, which started in March.

“COVID has accelerated the shift of people to online shopping,” said Singh. “Like my dad, he never shopped online, but during COVID he’s even buying his toothpaste online. It’s a tectonic shift.”

But many traditional retail brands haven’t nailed the online shopping experience yet, Mehta added.

“With ecommerce, it’s not just about selling the product,” she said.

To keep customers engaged, SockSoho relies on WhatsApp to share new products and customer photos. But that level of personal engagement will become more challenging as the brand grows.

This is where the proprietary technology SockSoho is developing comes into play. This includes AI-based chatbots that can handle simple queries, like exchanges. For example, a customer who receives the wrong item will be able to upload a photo and get a replacement shipped to them. More complicated issues will be be flagged for human customer representatives.

“We are building this proprietary software inside the company, which can actually replicate the human experience. We are collecting all the data, all the interactions that are happening currently with customers to understand the language, the data and the kind of experience they like,” said Mehta.

SockSoho is also developing its own AI-based recommendation engine, that will show customers products they are likely to be interested in based on their browsing and shopping habits. The startup isn’t revealing yet what verticals it will expand into next, but it is already doing A/B testing for its next product lines.

“Once we have built our tech stack, our whole supply chain and nailed down the socks, it will be very easy for us to go into any other vertical and eventually become the Uniqlo of India,” said Singh.

What does accountability look like in 2020?

“What happens after a company gets called out?” he asked over the phone. “Do you know what happens to the people in-house that come forward?”

I didn’t.

A Black male engineer at a fashion tech company who wished to remain anonymous was telling me how he’d been passed over for promotions white counterparts later received after they’d pursued risky and unsuccessful projects. At one point, he said management tasked him with doing recon on a superior who made disparaging comments about women because his subordinates were uncomfortable reporting it directly to HR.

When human resources eventually took up the matter, the engineer said his participation was used against him.

More recently, his company brought furloughed employees back and managers promoted a younger, white subordinate over him. When he asked about the move, his direct supervisor said he was too aggressive and needed to be more of a role model to be considered in the future.

In the absence of industry leadership, there’s no blueprint to remedy institutional problems like these. The lack of substantial progress toward true representation, diversity and inclusion across several industries illustrates what hasn’t worked.

Audrey Gelman, former CEO of women-focused co-working/community space The Wing, stepped down in June following a virtual employee walkout. Three months earlier, a New York Times exposé interviewed 26 former and current employees there who described systemic discrimination and mistreatment. At the time, about 40% of its executive staff consisted of women of color, the article reported.

Within days, Refinery29’s EIC Christene Barberich also resigned after allegations of racism, bullying and leadership abuses surfaced with hashtag #BlackatR29.

In December 2019, The Verge reported allegations of a toxic work environment at Away under CEO Steph Korey. After a series of updates and corrections in reporting, it seemed she would be stepping away from her role or accelerating an existing plan for a new CEO to take over. But the following month, she returned to the company as co-CEO, sharing the statement: “Frankly, we let some inaccurate reporting influence the timeline of a transition plan that we had.”

Last month, after Korey posted a series of Instagram stories that negatively characterized her media coverage, the company again announced she would step down.

Bon Appétit former editor-in-chief Adam Rapaport resigned his position the same month after news broke that the cooking brand didn’t prioritize representation in its content or hiring, failed to pay women of color equally and freelance writer Tammie Teclemariam shared a 2013 photo of Rappaport in brown face.

In a public apology, staffs of Bon Appétit and Epicurious acknowledged that they had “been complicit with a culture we don’t agree with and are committed to change.”

Removing one problematic employee doesn’t upend company culture or help someone who’s been denied an opportunity. But with so much at stake when it comes to employing Instagram-ready branding, the lane is wide open for companies to meet the moment when it comes to doing the right thing.

A 2017 report by the Ascend Foundation found few Asian, Black and Latinx people were represented in leadership pipelines, and at that point, the numbers were actually getting worse. Seemingly, in an effort for transparency and accountability to do better, 17 tech companies shared diversity statistics and their plans to improve with Business Insider in June 2020. The numbers were staggering, especially for an initiative supposedly prioritized industry-wide in 2014:

Underrepresented minorities like Black and Latinx people still only make up single-digit percentages of the workforce at many major tech companies. When you look at the leadership statistics, the numbers are even bleaker.

While tech’s shortcomings show up clearly in a longstanding lack of diversity, companies in other industries polished their brands sufficiently to skate by — until COVID-19 and the call for racial justice after George Floyd’s murder called for lasting change.

In June, Adidas employees protested outside the company’s U.S. headquarters in Portland, Oregon and shared stories about internal racism. Just a year ago, The New York Times interviewed current and former employees about “the company’s predominantly white leadership struggling with issues of race and discrimination.”

In 2000, an Adidas employee filed a federal discrimination suit alleging that his supervisor called him a “monkey” and described his output as “monkey work.” When spokesperson Kanye West said in 2018 that he believed slavery was a choice, CEO Kasper Rorsted discussed his positive financial impact on the brand and avoided commenting on West’s statement.

In response to the internal turmoil at Adidas, the brand originally pledged to invest $20 million into Black communities in the U.S. over the next four years, increasing it to $120 million and releasing an outline of what they plan to do internally, Footwear News reported.

On June 30, Karen Parkin stepped down from her role as Adidas’ global head of HR in mutual agreement with the brand. In an all-employee meeting in August 2019, she reportedly described concerns about racism as “noise” that only Americans deal with. She’d been with the brand for 23 years.

Routinely protecting employees perceived as racist, misogynistic or abusive is bad for business. According to a 2017 “tech leavers” study conducted by the Kapor Center, employee turnover and its associated costs set the tech industry back $16 billion.

POC experience-centered social and wellness club Ethel’s Club invested into its community’s well-being and has not only managed to stay open (virtually) through the COVID-19 pandemic, it has managed to grow. Meanwhile, The Wing lost 95% of its business.

So, what really happens after the companies are called out? Often, the bare minimum. While the perpetrators of the injustice may endure backlash, abusers in corporate structures are often shifted into other roles.

Tiffany Wines, a former social media and editorial staffer at media/entertainment company Complex, posted an open letter to Twitter on June 19 alleging that Black women at the outlet were mistreated, sharing a story in which she claimed to have ingested marijuana brownies left in an office that was billed as a drug-free environment. Wines said she blacked out and accused superiors of covering up the incident after she reported it.

Her decision to speak up prompted other former employees to share stories alleging misogyny, racism, sexual assault and protection of abusers. One anonymous editor said she was asked if she would be comfortable with a workplace that had a “locker room culture” during a 2010 interview. (She did not end up working there.)

Complex Media Group put out a statement four days later on its corporate Twitter account, which had approximately 100 followers — as opposed to its main account, which has 2.3 million followers.

“We believe Complex Networks is a great place to work, but it is by no means perfect,” read the statement. “It’s our passion for our brands, communities, colleagues, and the belief that a safe and inclusive workplace should be the expectation for everyone.” It went on to state that they’ve taken immediate action, but it’s unclear if anyone has been terminated. [Complex is co-owned by Verizon Media, TechCrunch’s parent company.]

Members of the fashion community have formed multiple groups to combat systemic racism, establish accountability and advance Black people in the industry.

Set to launch in July 2020, The Black In Fashion Council, founded by Teen Vogue editor-in-chief Lindsay Peoples Wagner and fashion publicist Sandrine Charles, works to advance Black individuals in fashion and beauty.

The Kelly Initiative is comprised of 250 Black fashion professionals hoping to blaze equitable inroads, and they’ve publicly addressed the Council of Fashion Designers of America in a letter accusing them of “exploitative cultures of prejudice, tokenism and employment discrimination to thrive.”

Co-founders of True To Size, Jazerai Allen-Lord and Mazin Melegy, an extension of the New York-based branding agency Crush & Lovely, started offering their Check The Fit solutions to the brands they were working with in 2019. The initiative is an audit process created to align in-house teams and ensure sufficient representation is in place for brands’ storytelling.

Check The Fit determines who the consumer is, what the internal team’s history is with that demographic and the message they’re trying to communicate to them, and how the team engage’s with that subject matter in everyday life and in the office. Melegy says, “that look inward is a step that is overlooked almost everywhere.”

“At most companies, we’ve seen a lack of coherence within the organization, because each department’s director is approaching the problem from a siloed perspective. We were able to bring 15 leaders across departments together, distill through a list of concerns, find points of leverage and agree on a common goal. It was noted that it was the first time they were able to feel unified in their mission and felt prepared to move forward,” Lord says of their work with Reebok last year.

Brooklyn-based retailer Aurora James established the 15 Percent Pledge campaign, which urges retailers to have merchandise that reflects today’s demographics: 15% of the population should represent 15% of the shelves.

During the melee that transpired largely on Twitter and Instagram only to attempt to be reconciled in boardrooms, one Condé Nast employee and ally has been suspended. On June 12, Bon Appétit video editor Matt Hunziker tweeted, “Why would we hire someone who’s not racist when we could simply [checks industry handbook] uhh hire a racist and provide them with anti-racism training…” As his colleagues shared an outpouring of support online, a Condé Nast representative said in a statement, “There have been many concerns raised about Matt that the company is obligated to investigate and he has been suspended until we reach a resolution.”

Simply reading through accusers’ first-person accounts, it often seems like these stories end up on public forums because little to nothing is done in favor of the people who step forward. The protection has consistently been of the company.

The Black engineer I spoke to escalated his concerns to his company’s CEO and said the executive was unaware of the allegations and seemed deeply concerned.

Seeing someone who seemed genuinely invested in doing the right thing “obviously, means a lot,” he said.

“But at the same time, I’m still really concerned knowing the broader environment of the company, and it’s never just one person.”

As fashion has its metaverse moment, one app looks to bridge real and virtual worlds for sneakerheads

Fashion is having its moment in the metaverse.

A riot of luxury labels, music, and games are vying for attention in the virtual world. And as physical events and the entertainment industry that depends on them shuts down, virtual things have come to epitomize the popular culture of the pandemic.

It’s creating an environment where imagination and technical ability, not wealth, are the only barriers to accumulating the status symbols that only money and fame could buy.

Whether it’s famous designers like Marc Jacobs, Sandy Liang, or Valentino dropping styles in Nintendo’s breakout hit, Animal Crossing: New Horizons; HypeBae’s plans to host a fashion show later this month in the game; or various crossovers between Epic Games’ Fortnite and brands like Supreme (which pre-date the pandemic), fashion is tapping into gaming culture to maintain its relevance.

One entrepreneur who’s spent time on both sides of the business as a startup founder and an employee for one of the biggest brands in athletic wear has launched a new app to try build a bridge between the physical and virtual fashion worlds.

Its goal is to give hypebeasts a chance to collect virtual versions of their physical objects of desire and win points to maybe buy the gear they crave, while also providing a showcase where brands can discover new design talent to make the next generation of cult collaborations and launch careers.

Aglet’s Phase 1

The app, called Aglet, was created by Ryan Mullins, the former head of digital innovation strategy for Adidas, and it’s offering a way to collect virtual versions of limited edition sneakers and, eventually, design tools so all the would-be Virgil Ablohs and Kanye Wests of the world can make their own shoes for the metaverse.

When TechCrunch spoke with Mullins last month, he was still stuck in Germany. His plans for the company’s launch, along with his own planned relocation to Los Angeles, had changed dramatically since travel was put on hold and nations entered lockdown to stop the spread of COVID-19.

Initially, the app was intended to be a Pokemon Go for sneakerheads. Limited edition “drops” of virtual sneakers would happen at locations around a city and players could go to those spots and add the virtual sneakers to their collection. Players earned points for traveling to various spots, and those points could be redeemed for in-app purchases or discounts at stores.

We’re converting your physical activity into a virtual currency that you can spend in stores to buy new brands,” Mulins said. “Brands can have challenges and you have to complete two or three challenges in your city as you compete on that challenge the winner will get prizes.”

Aglet determines how many points a player earns based on the virtual shoes they choose to wear on their expeditions. The app offers a range of virtual sneakers from Air Force 1s to Yeezys and the more expensive or rare the shoe, the more points a player earns for “stepping out” in it. Over time, shoes will wear out and need to replaced — ideally driving more stickiness for the app.

Currency for in-app purchases can be bought for anywhere from $1 (for 5 “Aglets”) to $80 (for 1,000 “Aglets”). As players collect shoes they can display them on their in-app virtual shelves and potentially trade them with other players.

When the lockdowns and shelter-in-place orders came through, Mullins and his designers quickly shifted to create the “pandemic mode” for the game, where users can go anywhere on a map and simulate the game.

“Our plan was to have an LA specific release and do a competition, but that was obviously thrown off,” Mullins said.

The app has antecedents like Nike’s SNKRS, which offered limited edition drops to users and geo-located places where folks could find shoes from its various collaborations, as Input noted when it covered Aglet’s April launch.

While Mullins’ vision for Aglet’s current incarnation is an interesting attempt to weave the threads of gaming and sneaker culture into a new kind of augmented reality-enabled shopping experience, there’s a step beyond the game universes that Mullins wants to create.

Image Credits: Adidas (opens in a new window)

The future of fashion discovery could be in the metaverse

“My proudest initiative [at Adidas] was one called MakerLab,” said Mullins.

MakerLab linked Adidas up with young, up-and-coming designers and let them create limited edition designs for the shoe company based on one of its classic shoe silhouettes. Mullins thinks that those types of collaborations point the way to a potential future for the industry that could be incredibly compelling.

“The real vision for me is that I believe that the next Nike is an inverted Nike,” Mullins said. “I think what’s going to happen is that you’re going to have young kids on Roblox designing stuff in the virtual environments and it’ll pop there and you’ll have Nike or Adidas manufacture it.”

From that perspective, the Aglet app is more of a Trojan Horse for the big idea that Mullins wants to pursue. That’s to create a design studio to showcase the best virtual designs and bring them to the real world.

Mullins calls it the “Smart Aglet Sneaker Studio”. “[It’s] where you can design your own sneakers in the standard design style and we’ll put those in the game. We’ll let you design your own hoodies and then [Aglet] does become a YouTube for fashion design.”

The YouTube example comes from the starmaking power the platform has enabled for everyone from makeup artists to musicians like Justin Bieber, who was discovered on the social media streaming service.

“I want to build a virtual design platform where kids can build their own brands for virtual fashion brands and put them into this game environment that I’m building in the first phase,” said Mullins. “Once Bieber was discovered, YouTube meant he was being able to access an entire infrastructure to become a star. What Nike and Adidas are doing is something similar where they’re finding this talent out there and giving that designer access to their infrastructure and maybe could jumpstart a young kid’s career.”

Vestiaire Collective raises $64.2 million for its second-hand fashion platform

Vestiaire Collective just closed another big round of funding in the middle of an economic crisis — the round closed in early April. The startup raised $64.2 million (€59 million) and the company has raised over $240 million over the year according to CrunchBase. Vestiaire Collective operates a marketplace of pre-owned fashion items. Users can both sell and buy clothes and accessories on the platform.

There’s a huge list of investors in today’s round — Korelya Capital, Fidelity International-managed funds, Vaultier7, Cuit Invest and existing investors Eurazeo (Eurazeo Growth and Idinvest Venture funds), Bpifrance, Vitruvian Partners, Condé Nast, Luxury Tech Fund and Vestiaire Collective CEO Matt Bittner are all participating.

With 9 million members across 90 countries, Vestiaire Collective has become a huge marketplace. And it makes sense that an e-commerce website focused on pre-owned items is working well. There has been a ton of backlash against fast fashion over the past few years.

People now also value circular business models as it becomes more affordable to refresh your wardrobe, especially during an economic crisis, and it is better for the environment.

As always, Vestiaire Collective will use the new influx of cash to expand to more countries. In particular, with Korelya Capital as a new backer, the company will expand to South Korea and Japan this year. While the company started in France, 80% of transactions are now cross-border transactions.

Originally, Vestiaire Collective asked you to send your items to its warehouses to check them before putting them on sale. The startup has been betting on direct shipping from the seller to the buyer in Europe and it has been working well. You can get reimbursed if there’s something wrong with what you ordered though.

Direct shipping has been available in Europe since September 2019 and it now represents over 50% of orders in the region. Up next, Vestiaire Collective will introduce direct shipping in the U.S. this summer and in Asia by the end of 2020.

Rebecca Minkoff has some advice for e-commerce companies right now

When Rebecca Minkoff first moved to New York City, the then-18-year-old was making $4.75 an hour.

“I just kept working for this designer and someone was telling me what to do every day. I just didn’t like that. And I thought if I’m going to work as hard, it’s going to be for myself and I want to call my own shots,” she said. “I didn’t want to be told what to do, frankly.”

Self-employment for Minkoff turned out just fine; in 2001, she redesigned the iconic “I Love New York” shirt and it appeared on The Tonight Show. After a shout-out from Jay Leno, Minkoff spent the next eight months making T-shirts on the floor of her apartment and quit her job to start designing full time.

We caught up with Minkoff to learn more about how she grew her brand into a global fashion company with the help of her brother, her problem with the unicorn mentality and why she thinks the “invisible barrier” is the future of retail tech.

This interview was edited for brevity and clarity.

TechCrunch: What gave you the energy and drive to become an entrepreneur?

Rebecca Minkoff: Long story. My mom would sell these cast covers, like decorative covers for people with broken arms at the flea market. And I was like, I am going to have a booth here. So I made all these tie-dye shirts and no one bought anything but it was just this idea of like, I can make something I can sell. My mom always taught that. When I wanted a dress, she taught me how to sew a dress instead of buying the dress. And so, I just got this bug for creating things out of nothing.

The constant thread was, “I’m not going to pay for this. You’re going to learn how to do it.”

Moda Operandi, an online marketplace for high-end fashion, raises $100M led by NEA and Apax

Moda Operandi, an online marketplace that specialises in right-off-the-runway luxury fashion, accessories and home decor, is today announcing a high-priced event of its own: it’s raised $100 million, a mix of equity and debt that it will use to invest in its platform and technology as well as to continue growing business overall, which was founded in 2010 and today offers products from some 1,000 brands and designers and ships to 125 countries.

“For the past eight years, Moda has disrupted the way people shop for luxury fashion,” said Moda Operandi CEO Ganesh Srivats in a statement. “This investment will enable us to build on that innovation, investing further in the client and designer experience and connecting more of the world’s best fashion to more people.”

The financing is being co-led by NEA and Apax Partners, both previous investors in Moda Operandi, with participation also from the Santo Domingo Family (connected to Lauren Santo Domingo, who co-founded Moda with Aslaug Magnusdottir), Comerica Bank, TriplePoint Capital and other unnamed investors.

The company’s valuation is not being disclosed but in its last round, in 2017, Moda Operandi had a post-money valuation of $650 million, according to data from PitchBook. It has raised $345 million to date.

High-end fashion might not be the first thing that comes to mind when you think about online shopping, but it has actually been a ripe market for the e-commerce industry.

While those in the know (and in the money) might attend catwalk shows, and bijou boutiques in swish locales are likely to be around for many years to come, there is a massive population of people who have the income and inclination to shop for luxury fashion, but might not be in the right place, or have the time, to do so.

For these shoppers, websites, mobile apps — and most recently new channels like Instagram and messaging services — have become a key route to browsing and buying, leading to the rise of huge businesses like Farfetch, Net-a-Porter and more.

That trend has helped to buffer Moda Operandi up to now, but it’s also the one that will be interesting to watch down the line.

We’ve written about the rise of direct-to-consumer brands and how that has played out specifically in the world of fashion, which in turn becomes a new group of competitors to aggregating marketplaces like Moda Operandi.

Similarly, the growing trend of targeting consumers wherever they happen to be also represents a rival business model, with some fashion retailers now foregoing websites altogether in favor of using third-party messaging apps to reach their target customers. Will Moda Operandi change with the times to do more of this kind of selling, too? Like fashion, what’s in today might be out tomorrow, so even the best channels are moving targets.

In any case, Moda Operandi has most definitely shown that it’s prepared to evolve and upset the status quo. The company got its start in 2010 in part out of an aha-moment from Santo Domingo, a socialite, former model and former editor at Vogue.

As someone who had worked for years in the luxury fashion industry, fully immersed as a consumer to boot, she knew that only a small, rarefied group of people ever got full access to a designer’s runway collection.

Moda Operandi was her solution — a platform to broaden that out, giving access to a full trunkshows (as the runway collections are called) to a wider selection of possible buyers and improving revenues for designers and brands in the process, since they no longer had to rely just on more traditional channels, namely buyers for retailers. The site had some catches — for example, as we pointed out at the time, you could shop a runway look, but still had to wait months for the piece to actually arrive with you, since those items would have yet to be made; but it caught on with a loyal following.

Over the years, the site’s basic remit has expanded, covering not only runway collections but also extending into jewellery, accessories and home decor. (We asked what size the business is today, and whether Moda Operandi can share any details on how that has changed over time, but a spokesperson said the company would not be sharing these or other financial details today.)

In any case, it’s remained a compelling enough business to have brought in a hefty round of growth funding from its previous backers.

“We continue to be impressed with the power of Moda’s brand and its positioning in the luxury market,” said Dan O’Keefe, managing partner of Apax Digital, in a statement. “Moda has been enhancing its technology capabilities as a world leading platform for fashion discovery and is led by a world-class team. We look forward to continuing to support their expansion.”

“Moda Operandi has really disrupted the traditional ecommerce model, using technology to give people unprecedented access to fashion,” added Tony Florence, general partner and head of technology investing at NEA, in a statement. “It was a really big idea when we led the Series A, and today Ganesh and the team are executing on that data-enabled retail model at scale. We are thrilled to continue supporting the company in this latest round.”