This Week in Startups - Building for the circular economy and the future of shopping with Poshmark’s Manish Chandra | E1805

Episode Date: September 9, 2023

This Week in Startups is brought to you by… Embroker. The Embroker Startup Insurance Program helps startups secure the most important types of insurance at a lower cost and with less hassle. Save up to 20% off of traditional insurance today at Embroker.com/twist. While you’re there, get an extra 10% off using offer code TWIST. .Tech domains are the go-to namespace to build anything in tech… and home to the world’s most innovative startups. Secure your .Tech domain today and lock down a 1-year domain for $10, or a 5-year domain for $50 at https://go.tech/TWIST today! Plunge. Go to https://plunge.com and use code twist150 for $150 off your cold plunge tub. * Today’s show: Poshmark CEO Manish Chandra joins Jason to discuss the expansion of the “Circular Economy” (2:47), consumer-to-consumer shopping (18:30), building a community with Poshmark (32:59), and much more! * Time stamps: (0:00) Poshmark CEO Manish Chandra joins Jason (2:47) The expansion of the "Circular Economy" and what drives consumers towards Poshmark (6:31) The most popular shopping categories and Poshmark’s day one vision (11:51) Embroker - Use code TWIST to get an extra 10% off insurance at https://Embroker.com/twist (13:20) Impact of the fast fashion movement (20:56) Global shipping and areas for optimization (24:38) Poshmark introducing live shows (27:04) .Tech Domains - Apply to get your startup featured on This Week in Startups at https://startups.tech/jason (28:12) The social shopping space (32:59) Important factors in building a community (37:52) Plunge - Go to https://plunge.com and use code twist150 for $150 off (39:20) Lessons learned from Manish’s entrepreneurial journey * FOLLOW Manish: https://twitter.com/marrc * Read LAUNCH Fund 4 Deal Memo: https://www.launch.co/four Apply for Funding: https://www.launch.co/apply Buy ANGEL: https://www.angelthebook.com Great recent interviews: Steve Huffman, Brian Chesky, Aaron Levie, Sophia Amoruso, Reid Hoffman, Frank Slootman, Billy McFarland, PrayingForExits, Jenny Lefcourt Check out Jason’s suite of newsletters: https://substack.com/@calacanis * Follow Jason: Twitter: https://twitter.com/jason Instagram: https://www.instagram.com/jason LinkedIn: https://www.linkedin.com/in/jasoncalacanis * Follow TWiST: Substack: https://twistartups.substack.com Twitter: https://twitter.com/TWiStartups YouTube: https://www.youtube.com/thisweekin * Subscribe to the Founder University Podcast: https://www.founder.university/podcast

And then on the people's side, by one principle that has been very core to me as an entrepreneur is embracing the weirdness of every single person you meet. And also embracing your weirdness, which means recognizing you're special and you're kind of unique, but you're also kind of screwed up and effed up like everyone else. And then aligning with the person you're meeting and knowing that they have strength and figuring out how to combine those strength and admire that. And that has allowed me to tap into various folks. You know, for example, in my board, we had people of certainly different ethnicities and colors. You know, I was privileged to have two black women on my board, but that was sort of what you can look. But then when you think of their strengths with each person rot, there were people who had never finished college than the people who had two master's degrees on the board. And similarly at the employment team.

So tapping into everyone's uniqueness is a very powerful tool. This weekend startups is brought to you by, and broker's startup insurance program helps startup security. you're the most important types of insurance, at a lower cost, and with less hassle. Save up to 20% off of traditional insurance today atambroker.com slash twist. While you're there, get an extra 10% off using offer code twist. DotTech Domains has a new program called Startups.Tech, where you can get your company featured on this week in startups. Go to startups.coms.com slash Jason to find out how.

And plunge. Go to plunge.com and use code twist 150 for $150 for $150 off your cold plunge tub. All right, everybody, welcome back to our all-star summer here on this week in startups. It has been crazy. Darmesh from HubSpot was on the pod. Rich Barton from Zillow, Glassdoor, and Expedia, Dave from MongoDB,

Ryan from Qualtricks, and he happened to buy the Utah Jazz. we had a little discussion about NBA teams, Will from Whoop, Mike from Zapier, which makes you happier. Man, and just the train is going to keep going. That the Grammarly CEO coming on.

I love that product. ORA CEO. A bunch of you folks are lunatics about the ORA ring. LinkedIn CEO, Plaid CEO, booking.com CEO. Man, it's like All Star Summer is going to go

into All Star September because so many great founders and CEOs want to come on the program and investors. And today, will be no different. I have been fascinated with Pops Mark since I heard about it. And if you have anyone in your life who is into fashion, you've heard about it. Manish, Chandra is the CEO. Welcome to the program. Manish. Thank you, Jason. Thanks for having me. All right. So there's something about the circular economy that captures everybody's attention. Tell me what is the circular economy

What is Poshmark? And why are this group of people so absolutely fanatical about it? So for us, the circular economy is really about conserving what you have and really reusing what you have. So we've produced a lot over the last decades. And now it's time to consume what we've produced and recycle it. So that's in a nutshell, circular economy. For us, the circular economy means really shopping each other's closets. Instead of buying retail, you buy resale.

And if you think about something that almost everyone in the world has, it's a closet. You have some clothes that you wear every day, no matter where you live, no matter which part of the world you are. And likely in any part of the world, and certainly for a lot of people, they have some clothes that they are not wearing right now. Either they've gone out of style, they've gone out of fashion, or they just don't like it. And what we've seen over the last decade is something that you don't want, somebody else wants. So the whole purpose and focus is how to make it delightful and simple for this closet economy to scale and make it easy to buy and sell your closets. And so what drives consumers towards this?

Because it does seem like there's a group of people who are into this, not for saving money, but it's the way they believe they should be consumers. So maybe we could just open up and double click on that piece of it. This is, and I don't know what percentage of your users this is, but we've always

had consignment stores. We've always had the ability to save money if you wanted to buy used. But this seems to be something more than that. There's a bit of a movement here. So if you were to look at 100 Poshmark users, how many would be in that subset of like fanatically interested in saving the planet and having their shoes for 10 years and, you know, if they're not using them, making sure somebody else is using them and they don't get fast fashion thrown into a landfill.

Yeah, no, I would say if you go back to the very beginning of Boschmark over the last decade or so, a small number of people, maybe 10%, 15%, have been very much about the fact that it's only for them, it's reuse, it's the only way to shop, it's the only way to sort of, live your life to thrifting. Outside of just the money saving, it's saving the planet because you're not consuming as much. You're not producing as much. You're not producing a lot of the second order side effects, global warming, which is really upon us in different ways. You are impacting all of that. The volume of those consumers and sort of a whole generation, particularly, you know, the generation we call Gen Z and even the younger generations after that are in some ways very focused. You could even use the word militant fighting for their right, or maybe in a way, undoing the sins of their fathers and mothers as they consume. So that's something we've seen in research or our surgeons in the last few years. And it would be harder to quantify, but I would say, you know, that number has doubled

or tripled as a percentage of Poshmark users where that is a core piece. But if that was the only thing and you didn't have convenience, you didn't have value pricing, you didn't have styling, that number would be much lower. When you add all of that, it becomes really a cold movement. That's what's happening, probably in the last five years, is it was growing and then it's taken another point of inflection. Interesting. And so what are the popular categories on the site?

I'm certain some things will lend themselves to being resold, other things maybe less so. So I'm wondering if it's things that are high end, you know, Chanel bags or, you know, notable pieces, or if it's just everyday pieces at a great price. Yeah. For us, it's mostly everyday pieces. We have a pretty significant business in luxury. But unlike, say, the real real, it's not our only form of business.

So we have a segment that's very high price because we physically authenticate the items. And so that's there. But the amazing equation we created with the shopper when we started the product is that we are able to buy and sell apparel. Like day-to-day, the shirt you're wearing, the shirt I'm wearing, you can buy and sell. That's a predominant amount, like more than half of the stuff we buy and sell is apparel. Now, that's a category historically that was not very big for eBay. That was not very big for any of the sort of online players.

And we literally single-handedly pioneered the growth of that category. Outside of handbags and shoes, sort of stuff that is a little bit easier to transact than, you know, a dress or a shirt, which has so much fitting requirement. etc. The second thing with apparel is that the average price per item is much lower. So you have to make the shipping, the transaction costs much cheaper for that to work. And we've been able to effectively achieve all of that. So it's kind of like, you know, if you think of Uber racks or Lyft kind of expanded the taxi market, we've sort of expanded the resale fashion market with a singular focus and empowering everybody to be able to sell and fulfill themselves without having to go to a

central point, and then working on systems that can reduce cost of payment processing, shipping, trust, you know, returns, all of the stuff that become friction and allowing that to create millions of closets across America with each other. And so talk to me a little bit about how you made the decisions about fulfillment, because there's a group of people who are like, I want to send, I want to get the stuff out of my closet. That's like part one. I don't want to do the fulfillment.

I don't want to manage us. Just get it all out of here. I'll send it to a consignment store or whatever. And then, you know, there's, hey, is this actually what you said it is? Is it in the condition you said it is in? Is it the right size? And is it authenticated? So if I want to buy something that's Nike, I don't want to buy a $3 fake Nike shirt or

shoes. I want to buy the ones that are legit. So how did you determine? you know, which model to go with? And did you think about different models or running them simultaneously? It was a really good question. I think, I think our vision from day one was that, you know, imagine if you are a girl sitting in a dorm or sort of, you know, initially, for the first five years or so, we only ran in the women's fashion category. And it wasn't until 2016 that we expanded to men's and kids and other categories out there. So from 2011 to 2016, first five years,

it was 100% focused on women's fashion. Partly it's because, you know, if you think of traditionally, women are a much bigger consumer percentage of the fashion spend, which means they naturally have bigger closets. They transact more, they're more focused on it. And then over the last four or five years, we've seen men expand their footprint. And for men, you know, it's not universal across categories.

Certain categories are extremely biased in terms of their spend. More notably, sneakers is, you know, it's a huge sort of part of the men's wardrobe in general. But for women, it's really spread across the thing. When you do that, you have to really solve for lower price point because that's the higher problem. I mean, if you have a $30 item, well, to give it to someone or ship it to someone, then they process it and ship it out. There's just not enough dollars to go around. So, understandly, you take on the process of self-fulfillment.

It's much harder to make the economics work. Whereas if you take a $3,000 Chanel bag, well, it can go through many hops and still, you know, there's profit to be had for each hop. along the way. So that was sort of one thing. But the other thing was when you look at sort of one of our users, we wanted to make sure that they can spend $10 here and $5,000 here. So that took many years to kind of build the right product and the right service level across the spectrum. So we can really be part of your whole closet. And then when we added Mence and Kids, we really expanded that footprint to all of the dimensions of your life. So today we feel from an end-to-end perspective, we provide the most comprehensive resale solution with different levels of things.

Now, consignment, which is, you know, say you want to sell something, you may not want to sell it directly, but you still want to make sure your clothes are going to a good home, environmental things, and, you know, maybe the money you make, you can donate it somewhere or whatever. That part is a process that many of our sellers support. We don't have a structured support for it, but many of our sellers act as consigners out there and help other people. And we certainly want to look in the future and maybe creating our own consignment network

as an option at the right time. Again, you've got to remain focused on your roadmap as an entrepreneur. You can't just go everywhere, but we've systematically added things to the product. All right, listen, we work with super early stage companies at my investment firm. It's called launch.

I'm talking pre-Series A, right? We're talking seed stage, friends and family. And you know what? At that stage, maybe they don't have insurance yet. In fact, just recently, we have an amazing startup. They didn't have D&O insurance. If you don't know what D&O means that basically protects your directors and officers, directors,

board of directors, officers, the people who run the company, your management team. So what do we do? We send them right over to Inbroker. Inbroker is business insurance built specifically for startups. Inbroker's single application helps startups get four quotes for four lines of coverage in 15 minutes. They connect you with one of their expert brokers. for unmatched service and that goes beyond your policy okay we use this uh at all of our companies it's easy peasy lemon squeezy and if you're not getting insurance you know at some point you're

going to have to get it so let's make that point today right now this weekend tonight just go to in broker today with the code twist and you'll get 10% off their startup package how do you get the startup package inbroker.com slash twist that's e mb r o k-e r dot com slash twist make sure you use that uh code twist for 10% off. That also more importantly than getting the 10% off, that shows them that you're listening to this week in startups. So we love in Broker. They've been amazing in terms of supporting our founders for years. And of course, this very podcast. Great job in Broker. Maybe you can talk a little bit about this movement of fast fashion and disposable clothes. This is something that I think is a major driver here that maybe consumers are learning that if you buy like my favorite brand of shoes is

Crocating Jones. It's a shoe store in London that has been making shoes, I think, for 200 years or something crazy. And I was just on Poshmark. I found all the Crocketing Jones. And I'm like, wow, the resell value of my $1,000 Crockoning Jones is like $300 for my 10-year-old shoes.

Wow, this is pretty incredible. If I was a younger, if I was a younger, Jason, I might actually buy those nine and a half Crocket Jones and just get the souls redone, and I would be in them for 30 or 40%. But then on the other side, you have people going to, is it sheen? or shine, whatever this, you know, horrible, horrible trend is of buying clothes and you wear

them once and throw them away. You can talk a little bit about that counter trend and you can have people are looking at it. So a couple of things. Fast fashion has been around in various forms. I mean, Sheen is the latest example of it and probably at the very low in terms of the price point. But you've had people who've been, you know, part of this trend and have been sort of under the microscope, if you may.

I mean, many years back, Forever 21 was criticized as a fast fashion brand, right? It sort of changed since then and evolved. H&M was a very low-price brand, and they've added, you know, a lot of sustainability piece, et cetera. So rather than commenting on specific brands, I would just say that the consumer's desire to have products that give them latest trendy looks at an extremely low price, they can use a few times and they don't care about the life cycle has always been there. Today's consumer, if you look at a Gen Z consumer and you talk to them, they're kind of a little

bit bifurcated in the sense that they will be spending money on Shien and they'll be spending money on a Pashmark at the same time. And, you know, when you ask them, the questions and answers, they'll have different answers as to why they do it. But there's a very good framework. The thing that has happened is between social media, which gives you instant, you know, instant access to so much data and information, the TikTok trends, which are sort of moving literally by two days, the ability for an average young person to keep up with all these things

that are happening is very hard. And when you look at a platform like Sheehan, they give them a tool at an economic price to be able to keep up with trends. Whether you should keep up with trends or not is not a decision I want to get into, the fact that these things do that. So what a platform like Pashmark is trying to do is to give them the same kind of trend data, but in a paid forward way. So you can buy that item.

It may cost you sometimes more than Sheehan, sometimes, you know, equal to Sheehan, but certainly something you can use forward. Like you were talking about your Crockett and Jones shoes that can kind of keep going forward. And, you know, I mean, obviously it's little less convenient than just buying an item and throwing it away. And you have to sort of use it and then wear it. But certainly the impact.

of what you do is much higher and the clothes look better. So I think from a pop culture perspective, the movement towards reuse is growing. And I believe that we will hit a point where suddenly, if you are wearing an inauthentic or sort of, you know, like if you're wearing an inauthentic designer bag, people will look down or criticize upon you. But I think if you're wearing an inexpensive dress

from one of these fast marketplaces, it's not something we sort of consciously internalize. So it's all about sort of that social dynamic that's happening. The funny thing is, if you search for Sheen and Poshmark, there's thousands of items that are up for sale from that brand, which is insane in some ways. Well, right. I mean, if it's a $20 piece and you're selling it used, how much are you possibly

selling it for? I mean, I would think people would just put them in a stack and be like, I'm a size X here, buy 20 items. That happens as well. So for very low-priced item, people will create these mystery boxes. and then sell them that way because it's cheaper to transport it, cheaper logistically to do that. But an auxiliary point here is that people actually want to buy resale and reuse at a core level. So sometimes even fast fashion brands are coming through the resale channel into people's closets,

which is okay. I mean, if you're reusing, another way I want to think about it is, if I buy this shirt and I use it two times and move it forward, and then it goes into the garbage boil. Supposing I sell it to someone, they use it once and then throw it away, that's not a good use. If I use it 20 times, somebody else uses it 20 times is a great thing. So if a low-priced fast fashion item can be used 10, 20, 30, 40, 50 times, whatever the number is, it's actually a better usage even though it is throwaway item.

And so usage in my mind transcends sort of the bucket in which you put in an item. and you guys had did you guys go public and then get bought by neighbor is that the history of the company we went public in January of 21 and January of 23 we were acquired by neighbor yeah neighbor of course is kind of the Google plus Yahoo of Korea um and incredible company there's three search engines basically uh neighbor Dow Dow down and um google in uh in Korea how did those transactions actions occur. Is this becoming the circular economy something popular in Asia and Korea, or is it that neighbor and they've had aspirations to kind of have more properties in the West? Is it something like they look at you as a way to kind of head west and build a base of revenue outside of

the Asian markets? A little bit of both. Like it's really a little bit of both. So circular economy is becoming big in in in in u.s in europe in the development market and even sort of the emerging Asian markets you are starting to see circular economy become big you know you have players like like Philippines Singapore everywhere Japan Korea China China has massive platform believe if not they have sneak at a retail platform that are driving you know tens of billions of dollars of GMV out there so it's it's

big. But for Navor, you know, as they are looking into expansion, they have a strong thesis that consumer to consumer shopping is a big dominant wave that's here and will grow over the next many decades, which we share. It's a shared belief. So that's the second thesis. The third thing is, out of all the players they looked at, they really thought that Pashmark had the unique sort of market and market dynamic, and they really were interested in partnering with Pashmark. So our conversation started by them making a private investment in a public company and potential discussions around that because they want to learn and partner with Poshmark around both C2C commerce and social commerce because we sit at the intersection of those two things.

And somewhere along that line, which we've documented through our public filings, it turned into an M&A discussion. That's fantastic. The rest sort of ended up leading to this partnership that we are in. Yeah, a pipe, public investment, or private investment in a public entity. equity. Yeah. So the question I have is you see a lot of cultural bridges being built, especially in fashion, music,

K-pop, in Japan, you know, Japanese fashion, and in America, all the stuff, anime. It's really just in the last, you know, Gen X, our generation and millennials have really gotten into this Gen Z. So I'm wondering, is there a way for you to move large amounts of product that could be interesting to people in Japan and products that are in Japan to the United States in bulk so that you could overcome this cost to ship products.

I went down the rabbit hole of trying to understand how fashion is made because I was going to have some investments and I found on very fascinating. There's an underground on Reddit

of services that will let you shop in China. Put your stuff into a box. Put that box into a container and so you could go shopping and every week they send a container to the United States and then resend your package.

So if you're an American and you want to shop the Chinese websites, buy a bunch of products in China and then shipped into the United States you have this like underground way of doing it with. It's really weird. I think Panda was the name of the product.

But that shows that there is something here in terms of globalization. So maybe have you thought about that? Has that come up? I'm just spitballing with here of kind of the future. Yeah, yeah, no. So we've just been testing something we call a global bazaar for cross-border shipping,

et cetera. But I think what you're tapping into sort of this optimization of logistics, so it makes it, you know, cost accessible, which, you know, you're talking about one of these things a little bit more structured. There's a company in Japan, I think it's called Buy You or something, where expats and their spouses would be shopping on behalf of the core Japanese folks and post photos, and then they would buy this item in a boutique in Europe or whatever and cost arbitrage because it was significant costs. Sometimes they'll bring it back, but sometimes it was even economical for them to

ship it back to Japan. And then you've seen K Beauty as sort of a bulk purchase and certainly Europe coming back here, you've got sites that try to, you know, bypass some of the systems. And certainly, I mean, if you've got a person who loves fashion when they go to Europe, they'll they'll buy stuff at 30, 40% cheaper in France and Italy that you get overall. So there's all of this stuff. We haven't looked at optimizing the bulk logistics, but we have looked at optimizing individual point-to-point logistics and making the inventory available.

But of course, all inventory is not easily purchasable. So it boiled down to more, something that are economically better to do, but some things that are just unique, you know, because there's so much stuff you can get access, particularly from different markets, whether you're looking at Korea or Japan or France or Italy, there's items available that you just don't get. So that's sort of been our focus a little bit in testing. But the economics and logistics are of significant everything.

So a panda-like service certainly could be something we could look to. I was just thinking like you don't have any physical stores ever, have you experimented with pop-ups? We don't have physical stores. See, I think, as I pop-up, if you did one in New York, one in L.A., one in Seoul, one in Tokyo, and you just did it as a one-year experiment, you shifted a bunch of, like you're saying, the most interesting items from the most interesting folks, you could say, hey, everybody who orders has to use the app when they come to store, they download the app, and you could just say, hey, however many app downloads.

Yeah. One of the interesting things is that we recently, about eight, nine months back, introduced live shows on the platform, and they've really taken off. What's a live show? A live show is someone actually goes, you know, opens up a live camera. We have something called POS shows full support for transaction in this show. And I can just show, hey, I want to sell this cup. I can bring it up and I can talk about it, that I can start an auction and people auction and buy that.

That's been a very popular form of shopping. So what you're talking about could actually be achieved through these global streaming networks without having to do a full shop. But you could kind of effectively simulate a shop where I could put these products up in other people could buy. Yeah. So I think these are all very interesting. Has that started to work in America? Have the live shows?

Because I know that was a big thing in China, right? I don't know if it got big in Korea or Japan, but have those live shows. Because we had QVC here for a while, but that was for shlocky stuff, I think, generally. I don't want to dig QC. We've seen tremendous success. So we, yeah. So the format that has worked for us is kind of very different than China and sort of other areas. With China and other areas is very much focused on big influence of selling a lot of products

with a lot of brands. And it's a big economy there, hundreds of billions of dollars. We haven't even achieved that. But the business has grown very rapidly for us. We haven't shared GMV numbers or revenue numbers yet on the business, but I would say it's the fastest growing business I've personally built in this time frame. It's growing very fast. And the difference is that our sellers are everyday sellers on Pashmark who are selling it. And our GMV is coming from tens of thousands of these sellers as opposed to just a few hundred sellers. So those sellers are individually selling an item.

You're stitching together their videos to play on a live stream. Is that right? No, no. They're actually hosting a live. Oh, they hosted themselves. Got it. Okay. So they will go through their 20 items.

Yes. Got it. And what we enabled was something unique to us was sell together. So I'm selling my items. You can also join my show and I can help you sell your items. And Re, who's sitting with me, can help sell her items. So much more dynamic to do a co-lab because you can riff on each other's stuff. I bring my audience, you bring your audience, third person brings theirs.

Now we've got three times as many people. And very community oriented, very community-oriented, which is the essence of Poshmark. Yes. When you're building an early stage tech startup, it can be really hard to stand out, right? Well, I've got great news for you. Instead of just selling domains, dot-tech domains, is going to give our twist listeners a platform to show off their startups. And that platform is this week in startups.

That's right. During this dot-tech domain's ad read, I will watch and judge a 20-second elevator pitch from a dot-tech founder. That's right. There's only one rule. You must have a dot-tech domain name to apply. And dot-tech domain names are blowing up right now. Aurora, a self-driving AI startup. they are building at aurora. Tech, another AI startup called 1x.Tacq. Back by Sam Maltman and

OpenAI is also building on a dot tech domain name. It's sweeping the globe. So if you're interested in pitching me and I'm going to give you candid feedback and you're building on a dot tech domain name, all I want you to do is fill out a form at startups.com slash jason. That's right, startups.tc.t.com slash jason. Fill out the form to apply and I look forward to giving feedback on your startup. You had work in the social shopping space. So this was an area, people don't, it's a forgotten area, but I had invested and was on the board of a company called this next.

Okay. You were at Caboodle. Yes. And then there was this weird site, Pinterest that was trying to make it work. Yes. And you had a couple of other people who were doing it. Why did that largely fail? I mean, I know you sold, but that whole.

space didn't create exactly enough value to become a strong independent. Obviously, Pinterest came out of that and then, you know, what you were doing in Poshmark. So what are the lessons you learned from that? Was it just too early? Was the affiliate revenue that most of you relied on just not enough? I think, I think the, there are three lessons. One is, I think, as an entrepreneur, how you think about the product and problem determines the outcome, right?

And so I typically give this story, Jason, where we talk a little bit about the fact that somebody looks at a coffee cup and sees a coffee cup. Somebody looks at it and thinks of a coffee cart. Somebody thinks of it and thinks of a coffee shop. Somebody can visualize a couple of coffee shops. But there was somebody who looked at a coffee cup

and visualized a whole Starbucks. And so how you think about the problem and how you redefine the problem matters. I think Pinterest founding team, particularly when I give a lot of respect for them, they look at the problem and they kept iterating and expanding the scope of the problem till that problem became so big and they could solve, you know, really big, big things. What do you think their definition of it was that works so well versus, say, the other ones that didn't work out so well?

Because they're saying the framing. The magical thing in my mind, there was two magical things. If we could go back that far and you and I probably remember very clear. at that time, just for your audience, I'll paint a picture. The Vogue at that time was products like Delicious and Caboodle, where you would go to a website, clip something, store it, and people could collaborate on it. That was sort of the shopping thing. Caboodle had sort of taken this and organized this, kind of like Pinterest, in the form of a list. So you could go there, you could clip it, and everything was on the list. So it felt very utilitarian, you know, because it was in the

form of a list. It was visually uninteresting. Then came a company called Polyvore, if you remember, Sequoia funded, you know, ultimately, I think Yahoo bought it. There, they took the same sort of clippings, but people would organize them in these beautiful visual collages, spend times perfecting them. Their engagement, in Caboodle, the velocity of creation was very high. The engagement velocity was low. So it was kind of not a great media property. It was a good utility.

Bollywood was a great media property. The number of creators was very small because it took a lot of time. But once you created this thing, this collage was very fun to consume. I felt what Ben and team did was they really combined the two things. So they made it very easy to create. So creating was just clipping, but instead of displaying the whole thing as a collage, they automatically created a collage of these images, hence a pinboard. The second dynamic we saw was enabling a creator to go to various website and clip from it was slow.

But when you reclip something, we had something called Add to Kabool, which was a kind of a re-pin, it was much faster because you were right there, you know, you don't have to go to another site, you just kind of repinned it. Ben and Team focused on that repin mechanics, called that sort of thing, and basically between repinning and this easy visual collaboration, they tapped into two things,

increase the velocity of creators by tapping into repin and increase the velocity of consumption by not having to spend time laying it out, but just sort of auto-laying it out. So I think they kind of took the best of both sides. And so they out executed everybody. They figured they figured out that it needed to look beautiful, but it needed to be utilitarian and fast.

And this is a great lesson for all entrepreneurs making product. There is just no slowing down. You have to keep iterating. And it has to be beautiful. And it also has to be functional, right? And sometimes people make things that are beautiful. Yes. You know, as you were pointing out, like people were really bummed

when that website, you mentioned Polyvore, closed their doors. I remember that was like, that was a community that really, really had codified itself. And then you look at these.

Super passionate. They were very deep into it. Like here's days, like a hipster magazine talking in 2018 about, you know, how heartbroken they were when this thing was gone.

So I guess that takes me to your building, doing a good job building community at Poshmark. So what have you, You learned about community across the two companies. And let's face it, you started as an engineer in Intel in the late 80s, early 90s. Yes. So I don't know when you got into being a fashionista, but that's probably a good question too.

But what have you learned specifically about community? Let's start there, because it's hard to build a community. What's in your playbook? I think building a community is about simplicity and authenticity. So simplicity in the sense that community doesn't need a hundred, features, they need like one or two things that they do that they really love to do on your platform, and their focus will be around that. The second thing is authenticity is very important, and that's a hard lesson that people

learn in that if you're doing something, you need to be transparent. If conversations are happening that are difficult conversations, they need to happen. You cannot curtail them, you know, within the bounds of legality. and other things. But beyond that, just because people are being rough about your company or about something else, you cannot control that flow of conversations.

And both of those things were true in Caboodle, but it was something I had not fully internalized. In Poshmark, those principles were codified from day one is there. The third thing is, if you build a very powerful community, and then you try to shove monetization into it in an artificial way, it causes problems.

We have had a recent example without naming the particularly popular social site that tried to over-monetize something and is having a revolt. And so one of the core first principles at Poshmark we put in is lead with love and money follows, lead with engagement and monetization follows. And so being a marketplace, you know, the more you have engaged users, you know, sort of built that virtuous cycle. So that allows us to continue to focus on authentic community tools and not sort of get weered away in building something that's antithetical community.

And so for me, those were all lessons. I mean, at one point in Caboodle, in the middle of the 08 recession, we were, because it was a depressing time, the media business, the present time everywhere, but particularly finance and media businesses were held extraordinarily hard. And we were running like four, five, six ad units on a single page, and hard to find what the content was. Yeah. because, you know,

you were so desperate to get some money in the door. Yeah. That you're just slapping ads everywhere and you're over monetize. So I love your rules. Simplicity. There's only one or two features you need. Two, authenticity. There's going to be some hard discussions.

Sometimes people in communities get a little rough. You got to kind of embrace that within reason. Obviously, there's some hard lines. And then monetization. Lead with engagement love. Money's going to follow, but you don't have to overdo it. And I guess Instagram is the one that's been like shoving it down people's

throats, way too many, you know, trying to sell stuff. They're playing catch up. I, you know, I think the ability to share money or just help people make a living is so powerful. Like, whether it's Airbnb, Uber, DoorDash, Craigslist, you know, all these places that give you the ability to make a living or make some side hustle. And now Twitter X giving a share of revenue, I guess how many of the people who are on the platform are like dedicated in making a full-time living, a part-time living, or just doing it because they think it's the right thing to do? And do you address those segments? Have I segmented it properly? Like full-time, part-time? No, absolutely. It's a continuum, though. I think there's a lot of people, I mean, percentage-wise,

I don't have a ready-made number, but I would say a good one-tenth to one-fourth of the people, between 10 to 25% of people are using Pashmark for some sort of income generation needs, if not more, right? I mean, again, this is just based on dollar, et cetera, overall. But then even people who are not doing it for that level are still generating income. Because there's no free, like, if you sell something, you make money. And now you may redeploy the money. So a big chunk of our users are what I call revolving closets.

Whatever money they make on an aggregate, they spend it, right back on the platform. Love it. And so that is truly circular economy. Do they leave the money in the account and then spend it and buy? Sometimes they do. Quite often they do, but many times what they do is they'll actually withdraw the money and then spend it back.

So, for example, they make 80 cents on the dollar. And for this community of sellers, if you look at it, literally if they earn $100, they're spending $80 back on the platform as a community, right? So great. And so to me, that's the power of community is that they're shopping from each. other, they're buying from each other, and they're spending everything right there. All right. When you're an entrepreneur, an executive or investor, you know, your mind needs to be sharp. And to keep your mind sharp, you need to treat your body right. Don't I know it? It comes

from eating right, which I'm doing. Exercise, I'm doing that. And let me tell you about my newest activity. No, it's not sleep. You're going to get sleep? Nope. It's cold plunges. Yes, I've taken the plunge and it has been incredible for me. I am so thrilled to tell you about plunge.com. That's where I got mine from. It's sleek, it's beautifully designed. When I put it on the side of my house, everybody says, ooh, what's that? Oh, that's beautiful. It's an insanely high quality product. It's ready to go out of the box.

It takes three minutes to feel amazing. You just jump in there. You can set it on a dial. Listen, I'm not a doctor. This is in medicine. What this is is an amazing way to feel great. And if you do any of the research on it, you listen to any of the folks online talking about the value of coal plunging at a minimum.

it makes me alert and feel great. Just go to plunge.com. Plunge.com, plunge.com. They also have gorgeous, saunus, too. I maybe get one of those next. Start doing cold plunges, like your boy, J-C-C-call. It makes you so alert. I feel like a superhero.

I get out of that thing. I feel like I can take on the world. So once again, go to plunge.com and get your incredible cold plunge tub today. By the way, if you use my code, Twist-150, T-W-I-S-T-W-I-S-T-V-O. You're going to get $150 off. Use the code, Twist-150.

Get $150 off your purchase today. And take the plunge. What can I say? I think one of the great things that I've learned over time is, if you just look at how things are constructed today, a lot of times people are going for margin. It's a race to the bottom. They're using terrible products.

And then I just had the founder of Boland Branch, if you know, the sheets. And he's gone the opposite direction where he wants his brand, Scott Tanner, who's great on the podcast. He's buying Egyptian cotton that's organic directly from the purveyors. and then he's building high quality stuff. He wants it to last forever. And what Tannen was saying is they put in their stores like all of the cotton sheets

and they show you after 50 washes, 100 washes, 200 washes, that it gets better. But then if you're buying the cheap stuff, it falls apart and it's not meant to last. And I was talking to one of our producers here. And they like to buy, you know, a certain type of jackets that starter jackets, you know, like you were a starter on the football team. And the quality has gone down in the, the last 20 years. But if you buy them from the 90s or the early 2000s, they're very high quality.

So it's actually, you could save money, buy something of higher quality, and it's got that vintage retro vibe to it. So it's kind of more unique in the world. And so there's just so many things going in the right direction for you. And really appreciate you coming on the podcast and sharing all of this. If you look back on your entrepreneurial career, what are the major lessons that you think, you know, for a founder will result in success, success being, you know, building a large sustainable business.

I think for me, the first thing it starts with is people. Surrounding yourself with the right team is key. I mean, all of my co-founders are still here with me after, you know, 12, 13 years, IPO, back to public, they're still there, you know. If I look at my first 20 employees, probably 16, 17 are still here. second is commitment to growth, your own growth, the growth of the people around you, the growth of your investors. I feel like if you're not growing as an individual, you can't grow the business you're in. So that real commitment to growth is key.

The third thing is when difficult circumstances come in front of you, you've got to figure out realistically what are your choices. And then use that opportunity to accelerate your march to whatever the destination is. And so for me, you know, we've gone through lots of ups and downs and in Pashmark. There have been times, you know, where I've been rejected by 100 investors sitting there and using that moment to sort of figure out, you know, with the resources we have, whether to become profitable, change the profitability, or, you know, when times are really dark, you know, I tune out of the current dark times, you know, obviously take action there, but then also dream of a good future.

So sort of keeping that dream intact or looking at, you know, realistically, what are sort of the different things where the world is going and how do you sort of take it forward, which when we found the right partner neighbor, we decide it's the right thing, not just for the entrepreneur or just for the employees, but for the investors, for the community, for the customers, for the partners, you know, making those holistic decisions. So, you know, if you go back, it's like you got to have a big dream and believe in that dream that your dream can be big, no matter what you're doing. Second is start with the right group of people and treat them well and make sure you're committed to their growth.

And fourth thing is, take every circumstance and create a way to accelerate your growth as opposed to impede your growth. That has sort of guided us. And then on the people's side, by one principle that has been very core to me as an entrepreneur is embracing the weirdness of every single person you meet and also embracing your weirdness, which means recognizing you're special and you're kind of unique, but you're also kind of screwed up and effed up like everyone else. and then aligning with the person you're meeting and knowing that they have strength

and figuring out how to combine those strengths and admire that. And that has allowed me to tap into various folks. For example, in my board, we had people of certainly different ethnicities and colors. I was privileged to have two black women on my board, but that was sort of what you can look. But then when you think of their strengths with each person wrought, there were people who had never finished college than the people who had two master's degrees on the board. and similarly at the employment team. So tapping into everyone's uniqueness is a very powerful tool.

I like the way you state that, because if you state it as like DEI, identity politics, it's kind of a road to nowhere because, oh, I, you know, I checkbox. I have one of this type of person, one of this type of person. What you're really saying is, you know, we're all have unique experiences and a diversity of experiences, you know, is going to contribute to the success of the company. And embracing the weirdness is just such a fun way to do it. Because like you said, we're all f*** up. We're all got different skills, et cetera.

So when you come to it as the leader, if you accept that everybody's unique and a little bit different, you don't have to be mad at people for being unique. You just kind of, they got their own mutant superpower and you just embrace them for having it. And don't, in that same vein of we are talking about it. And when you look at a person, don't just think that because the person looks kind of quote unquote normal, that they don't have massive weirdness. It's just the fact that, you know, this is the mainstream. person, his X, Y, and Z characters, he should be fine, or they, she should be fine, or they should be fine. Yeah. And this person, but everyone is going through tremendous amount of struggle and being able to

embrace them and empower that journey allows us to just grow and learn from everyone. Yeah, you know what? It's so well said. Thanks so much for coming on the program. You are a wild card of awesomeness. You know, we were like, saw you, we heard you on another niche podcast, and my producers were like, who is this guy? he's got such interesting insights and you didn't disappoint continuous success.

Everybody go check out Poshmark if you haven't already. Just well done and thanks for coming on the pod. Thank you, Jason.