Craigslist Competitor OfferUp Is Seattle MVP With Latest Fundingby
Mobile marketplace now valued at more than $1 billion
OfferUp to focus on supporting ‘massive growth,’ hiring
OfferUp, a secondhand mobile marketplace, raised $119 million in a funding round to become Seattle’s sole privately held tech company valued at more than $1 billion.
Private-equity firm Warburg Pincus led the fundraising round, OfferUp said in a statement Thursday. GGV Capital and Altimeter Capital joined Andreessen Horowitz, T. Rowe Price and other investors that have brought the company’s total fundraising to more than $210 million.
The startup, based in Bellevue, Washington, connects mobile-centric buyers and sellers for everything from roller blades and wedding dresses to cars. Listings require a photo. While the company has yet to turn a profit, Chief Executive Officer Nick Huzar said he’s experimenting with monetization models, including having sellers pay a small fee to boost the placement of their listing and a mobile-payment option available in Seattle which charges a fee to process the transaction. He said the company’s valuation has topped $1 billion.
“We’re focused on supporting the massive growth we have and creating the best experience we can,” Huzar said in an interview. “Valuation is really not that important to us as a business. However, we’re pretty happy to have raised it.”
OfferUp has about 105 employees and plans to expand the workforce, Huzar said. Peter Wilson, the former engineering head at Google in Kirkland, Washington, joined OfferUp as vice president of engineering, the company said in a blog post in June.
“When you think about it, people literally have billions of dollars of value sitting unused and unmonetized in their closets,” Warburg Pincus managing director Justin Sadrian said in an interview. “If you’ve ever gone through the process as either a seller or buyer or poster on Craigslist, it ain’t the easiest, most-user-friendly process but people do it because it’s a liquid marketplace. And then along comes the mobile device -- it’s with you at all times, it’s got both a camera and messaging built into it.”
Sadrian said he would like to see OfferUp expand its user base in the U.S. “Their capability is exportable and there’s an opportunity globally down the road but it’s not something they need to focus on tomorrow.”
OfferUp was founded in 2011 by Huzar and Arean van Veelen. There are currently 175 private companies worldwide valued at $1 billion or more, known as “unicorns,” according to CB Insights. The research firm confirmed there were no unicorns in the Seattle area, which means OfferUp is now the highest-valued private company in town.
The OfferUp app, which is ranked No. 38 overall among free offerings in the Apple iTunes store, is on track to have more than $14 billion worth of transactions in 2016, Huzar said. OfferUp has been downloaded more than 23 million times, according to its website.
The funding round was first reported by the Wall Street Journal.