India has a very strong foundation for resale and sustainability: Poshmark

Chandra: We are really excited about the opportunity. The time, the technology, the place where we are really bringing a bunch of forces together. It is a unique time in history, which is painful and dark but also in some ways full of innovation and change really sets the stage for this right now. People are focused on sustainability, particularly the younger generation.

We want to invest in it—at the people, marketing and growth level as the opportunity scales up. We think of it as multiple phases of growth.

The first phase for us is getting the platform out in the hands of users, starting to build the foundational community and then using the strength of that community. As that community develops it will just create more and more vibrancy in the market. That's the way we look at it.

What sort of growth in terms of hiring is lined up?

Chandra: India has been a core part of our growth strategy. We continue to open up hiring across all of our areas. Have signed multiple offer letters today for hiring in India. We continue to scale India in multiple ways to strengthen both our India business but also the global business.

Balasubramanian: We have about 160 plus employees based out of India - departments spanning across engineering, data engineering, core support, operations and several more. They do not just support India but other geographies that we are in and India being an R&D centre for us for so long. We will continue to build India as one of our core centres, which can support not just India but also other geographies.

How many people do you plan to hire?

Balasubramanian: Can’t give numbers.

Thrifting as a concept isn't new to India. However, multiple start-ups that tried their hand at it had to shut shop. What did they miss? What are you doing that has not been done so far?

Chandra: We have gone through a lot of different phases of growth even in the US to come to this point. There is an underlined structure— simplifying shipping, payments, returns, logistics all of that perfection is built into us. There is a fair bit of investment that we had to do and continue to do.

Then the second thing is really connecting the buyers and the sellers. We build so many different aspects of our merchandising.

The third piece is making selling super easy.

Finally, the foundation of everything is social. How we look at this community is very unique. For example, every seller is a curator, they are selling items, engaging with each other.

When we start to think of all these pieces, all of the different distribution engines, all of the technology deployed, the social infrastructure, the live party and then the entire operation infrastructure, it is a lot of built out we have taken time to build.

We are bringing all of that simultaneously to India and we believe that the ecosystem is shining, powerful and is really empowering.

What is the market size you are targeting?

Balasubramanian: The market size we look at is close to $20 billion in about five years. It is estimated that by 2030, it should be $70 billion. Covid has also taken us through a digitisation where there is so much time that we spend with our phones and therefore engagement has gone up. So social is here to stay and taking a share from the social commerce and building this out in India is going to be a very interesting project for us.

Are you also looking for inorganic growth? What sort of companies will you be open to acquiring? Are you open to that?

Balasubramanian: Absolutely, we have spoken about that in our public conversations with our investors. As we look at growth, we look at it certainly organically also inorganic growth, as the opportunities come up that can help further accelerate our strategies. Yes, we are open to it.

Any specific segment that you will be targeting— technology, merchandise?

Chandra: Any and all of them would be interesting opportunities of expansion for us. It boils down to timing and specific thesis and things that the company brings to the table.

What is the average ticket size of transactions done on Poshmark?

Chandra: The average order value on our marketplace in 2019 was $33. Around 87 percent of items purchased were preceded by a like, comment or offer on our marketplace.

You are entering India at a very interesting time when almost every top tech company is aspiring to go public. Poshmark just had a very successful IPO. What's your take on this euphoria and what are your suggestions to the tech companies going for an IPO?

Chandra: Ultimately the focus of any entrepreneur has to be to continue to build their business, serve the customers and scale the revenue. These milestones as they come you are prepared for that. You got to be ready for it. You have to have the right people in the team. It is a significant milestone to go from being funded by venture investors to a public company. It brings with it new obligations but also significant new ways to serve the market.

Once you go public the compliances increase. In the last seven months what has been your learning?

Chandra: Ultimately going public makes you a better company. It elevates you, allows a level of scrutiny that happens, there are checks and balances in place. You obviously as a company have a lot more visibility.

The positive side of more scrutiny is that you also get more visibility and presence out there. It is definitely a new set of obligations that you have to live with but that's a part of every phase of growth.

Why India now and who do you see Poshmark competing with in India?

Chandra: The time is really right for a social marketplace to enter. The demand for resale is scaling at a speed that is extremely high. The need to connect socially that's been the foundation of our society has come online. Covid has made the need more key. When you combine these forces, India has a very strong foundation for resale and sustainability.

Given our inherent asset which is our powerful team in India, it is all a combination of timing. This is not something we decided overnight, this has been in the works since last year.

What about competition?

Balasubramanian: There are several international players but coming to India we are the first global leader in social commerce. This is one of the marketplaces wherein you and I will sell to each other, buy from each other. That entire revolution is new in India and will come with a focus on social and community. So to that extent, we would be pioneering this entire commerce experience.

One of the things that Poshmark is always focussed on is the community. You first build the community as the centrepiece and build everything around it. You will see the business model works, that you have addressed the pain-points of the customers.

So, we see ourselves as someone who will bring in that much needed large player who has the ability to look at technologies, safety, trends to be able to make the whole platform very easy for buyers and sellers to really focus on what they should be doing which is interacting, engagement, etc. So, it opens a very big opportunity for us in India.