One of the interesting trends over the past couple of years is the creation of new online marketplaces (often P2P or “collaborative consumption”), where the payment transaction is managed/hosted by the publisher. The business model is usually transaction-based rather than advertising, with the publisher/site taking a percentage of the sale or a transaction fee.
These new marketplaces often bring e-commerce and new efficiency to what had previously been mostly opaque, offline market segments. AirBnB is the oft-cited exemplar, but there are at least 20 companies doing some version of the same thing.
This morning a SF-Bay Area company called Chairish launched after being in private beta for a number of months. It’s a used furniture marketplace from the people who started Hotwire and Tripit.
This is a multi-billion dollar market that mostly exists in offline furniture consignment shops or antique stores where there’s little or no pricing transparency. While there are well-established new furniture vendors and brands online (e.g., Crate&Barrell, Ikea, Room and Board) there’s really no used furniture marketplace — save maybe Craigslist (or eBay perhaps).
Chairish isn’t a furniture classifieds site, however. It’s a curated marketplace, where not all furniture is accepted for sale. There are quality standards and the site doesn’t want furniture valued at less than $250.
There are a number of immediate questions that arise. Chief among them: Will people buy used furniture online without seeing it first? And what about shipping from A to B?
The buyer pays shipping but Chairish will manage the process. And for those people who like the idea but don’t want to or can’t get involved with photographing and listing items for sale on the site, Chairish has a service that will come into your home, inspect your furniture, remove it to a warehouse and handle the entire process.
Chairish will take 20% of the value of the sale as a normal fee. In the latter case where the site does everything for the seller it takes 40%. It also has a return policy to create more confidence for buyers. The return policy also encourages sellers to be honest in their descriptions of furniture on the site.
I spoke at some length with the founders and they have been pretty thoughtful about all angles.
The site doesn’t include a search box — Chairish wants to encourage browsing and “serendipitous discovery” (it also doesn’t yet have the inventory to support a search box) — however all individual furniture profile pages will be indexed and will thus be discoverable via Google.
Chairish says its audience is “people who love design but don’t want to pay for it.” These are largely going to be more affluent women Chairish believes. But there are probably other audiences that will use the site.
I told them I saw parents seeking used kids furniture and twentysomethings trying to furnish apartments with “cool” yet affordable furniture as additional audiences and market segments. We also discussed the potential of estate sales through the site.
Chairish is very nicely done but it’s most interesting to me as representative of this phenomenon, mentioned above, of new marketplaces where the business model is transaction-based (not advertising) and where the site is seeking to bring liquidity to what had been a exclusively or largely offline market.