There are start-ups whose crisis linked to the coronavirus will have strengthened the positioning. This is the case of Back Market, whose platform for the sale of refurbished electronic articles met with very strong enthusiasm quickly after entering confinement. The introduction of telework, the sudden development of teleconsultation, short-time working or the explosion of online entertainment have all helped to attract consumers to this type of online store which allows them to buy second-hand equipment ( smartphones, tablets, consoles …) while benefiting from a guarantee.
This sudden and unpredictable boost accelerates when the young Parisian shoot brings together a new round of funding of 110 million euros with Goldman Sachs Growth, Aglaé Ventures and Eurazeo Growth, reveal Les Echos. Only five years after its creation, this new financial operation allows this nugget whose valuation would remain below a billion to position itself as one of the spurts of French Tech, in particular thanks to its activity in the United States, launched there two years. “The phenomenon is amazing, admits Thibaud Hug de Larauze, co-founder and CEO of Back Market. The day the bonus of $ 1,200 was paid to the Americans to boost their purchasing power in the midst of a crisis, our turnover there was doubled, for example. “
1200 merchants active on the platform
Growth across the Atlantic is what appeals to investors, aware that no major player has yet emerged in the second-hand market. To succeed, Back Market must still duplicate its model: identifying trusted resellers and brands that want to position their stocks in this market place still little known to the American public. Currently, the young shoot claims 1200 merchants, including 200 in the United States, and admits being late to meet the growing demand: “We work with less than 10% of the pool of potential partners, slips Thibaud Hug de Larauze. Whether it be direct brands, large retailers or product takeover networks, we still have a lot to do. “
Key figures
1200 DEALERS
are active, including 200 in the United States. Back Market estimates that it only works with 10% of its potential pool.
10% COMMISSION
The start-up takes a single percentage, regardless of the type of electronic product sold on its platform.
70% OF SMARTPHONES
It is the historic activity of the market place, and which still weighs the most weight in its revenues.
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Each time, the mechanics are the same. The start-up ensures compliance and guarantees the reconditioned product, then selects the best-positioned reseller according to the criteria chosen by the consumer. “This system of emulation between sellers is the secret ingredient of Back Market’s success,” says Yann du Rusquec, CEO of Eurazeo Growth. They are able to take into account a large number of criteria, beyond the price and the delivery method, which sets them apart from other players. “
Increasingly present brands
This selectivity is pushing more and more premium brands to offer their catalog of unsold products and returns via the platform. This is the case of Dyson, Bosch, Marshall or Apple via Brightstar, even if the young CEO believes that this movement is not yet enough: “Our main danger is that the manufacturers are not playing the game enough and that they adopt a defensive strategy vis-à-vis the second-hand market. But consumers are becoming more and more aware of the ecological emergency, and I hope to manage to ensure that there is no longer any factual reason to prefer a new product to a refurbished one. “
To materialize this objective, the start-up will double its team (300 employees today) within the next two years, and try to impose its market place as a world leader, in the same way as Booking and Airbnb. By leveraging the backbone of the circular economy which should further accelerate with the global economic crisis.
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