Originally posted on Housakicks
This morning, I received the following Email from Flightclub,
Nearly 13 years ago we opened our first door on Greene St. and broke all conventional wisdoms for what it meant to be a sneaker store in New York City. We had one goal in mind: to source the rarest and most coveted shoes around the globe, and get them into the hands of collectors and enthusiasts who appreciated our same sensibilities. Unbeknownst to us at the time, was that with your help, as a loyal seller, we’d go on to accomplish that and much more. Together, we helped define an industry. Together we helped reshape the landscape of sneaker retail and e-commerce. Together we created our mark in sneaker culture history.
Because of that, it brings us great joy to announce to you first that Flight Club is merging with GOAT to create the world’s largest sneaker marketplace. In just 3 short years, GOAT has become the premier mobile platform for listings by demonstrating the best in class technology in our space. Together, as one company, we will leverage both brands to create synergies that offer unparalleled efficiencies and liquidity to you, as a seller. There won’t be any immediate changes to the seller experience on either platform, but as we further develop our plans, we’ll be sure to communicate them as they occur. Rest assured, the outcomes will mean good things to you as a seller.
This really doesn’t come as a surprise to me; I actually wrote a post urging Flightclub to make some changes if they wanted to thrive in the current Resale Market, see post below.
StockX has its hands full now and the competition is going to be fierce. This merger with GOAT is a game changer and Flightclub should’ve done that a longtime ago. Flightclub already has a large audience and working together with GOAT and its system in place takes both brands over the top. I don’t mind StockX but the the platform has a major flaw that is not being addressed; I’m referring to the ridiculous offers that buyers make, knowing darn well that sellers won’t accept them. I can understand how that’s possible on eBay but StockX is one of the standards in the resale market and allowing unreasonable offers/bids on their platform is doing them a disservice. I know they don’t care because they make money either way. But one thing they forget is that without sellers, they don’t exist. I’ve talked to several “resellers” and every one of them complained about the “lowball” offers on StockX. They should have some type of a “reserve” for shoes that are listed. For example, they can set up the platform so it doesn’t allow buyers to make an offer less than 20% of the item suggested retail price. This will be a great incentive for sellers; Flightclub was the complete opposite of Stockx as it pertained to prices. I think this merger will compel them to price their shoes more reasonably and will result into a win-win for both consignees and brokers. Flightclub’s system was also outdated and I talked about it in the post below ( read it for more info).
I’m very excited to see the kind of changes this merger will bring to the resale market.
Additional discussion points:
Via Recode, “While the companies are calling the transaction a merger, it certainly appears that GOAT is acquiring Flight Club. The combined company has raised a new $60 million investment from Index Ventures at a valuation north of $200 million, but a majority of those funds are being used to pay out Flight Club’s shareholders, according to people familiar with the deal. Flight Club has never raised any money from outside investors and is profitable.”
“The company went on to raise $30 million from Matrix Partners and Accel Partners over two investment rounds as the app took off. Last summer, former Twitter Chief Operating Officer Adam Bain joined GOAT’s board.”