Resale platform ThredUp has launched its new peer-to-peer marketplace (first announced in May) in closed beta, allowing sellers to list their items directly on the ThredUp marketplace for the first time in the company’s 15-year history. With the launch, ThredUp plans to leverage its experience in resale and proprietary technology to address common pain points in peer-to-peer resale, like that conducted on platforms such as Ebay and Poshmark.
“We’re 15 years into this and we’ve stayed pretty true to our core business model of the managed marketplace, but we have observed that there are a lot of sellers out there who want to do the work themselves and want to maximize their earnings,” said Alon Rotem, Chief Strategy Officer at ThredUp on the Retail Remix podcast earlier this year. “As we’re looking at ways to fortify and make our supply chain more resilient, it’s really about offering more choice. With a managed model and a peer-to-peer model customers really don’t have to go anywhere else — they can come to us.”
CEO James Reinhart announced the beta launch of the peer-to-peer offering on ThredUp’s Q3 earnings call Nov. 3. He referred to direct selling as a “third vector of growth” for the company, which has seen several successive quarters of accelerating revenue and buyer growth.
Q3 2025 was no different, with quarterly revenue hitting a record high of $82.2 million (a 34% increase year-over-year) and October representing the best month for new-customer acquisition in the company’s history. Active buyers for the full quarter reached 1.57 million, representing 26% growth YoY, with new-buyer growth of 54% YoY.
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These gains have been driven by a number of recent changes at the company including offloading its underperforming European business unit, technology advancements in both the seller and buyer experience and a ramp up of its premium inventory, which has increased average selling prices.
ThredUp Aims to Fix Peer-to-Peer Resale
Now Reinhart thinks the time is right to tackled the peer-to-peer resale sector: “We have been working on the launch of direct selling on ThredUp for more than a year, but I personally have been working on this strategy for many years,” said Reinhart on the Q3 earnings call. “I felt strongly there was an opportunity to serve this market as resale became more mainstream, mobile technology matured and our operations hit a level of scale and margin where we could build a superior, differentiated customer experience. That time is now.”
Reinhart highlighted the many problems that still exist with peer-to-peer reselling, namely the arduous listing process, correctly pricing items and managing post-purchase experiences like returns. “The result is that most casual sellers participate for a while, they mix-and-match across peer-to-peer platforms, but they never love the experience,” said Reinhart. “While public data is hard to find, our longitudinal research suggested that the majority of items listed on current peer-to-peer platforms never actually sell. The fact is that this is a big market, and we believe it’s mostly broken.”
To fix it, ThredUp plans to focus on what Reinhart called “casual sellers,” that is those who don’t regularly sale items on resale platforms. Sellers will be independently verified and will not pay fees to list items, with ThredUp providing the listing, merchandising and photography tools needed to sell an item based on the infrastructure it has built up and refined for its managed marketplace. That infrastructure also will be of help in addressing pain points for buyers, namely returns and trust, both of which ThredUp is already equipped to handle.
Additionally, sellers will be able to easily choose whether they want to sell directly or use the managed marketplace, and can even do both at the same time — the former will be more work for the seller but will mean a higher share of the sale.
“We will bring a new wave of merchandise to buyers but in an organized and thoughtful way, backed by the generative AI products we launched over the past year,” said Reinhart. “And we will be methodical in our rollout, opting for quality and long-term defensibility over quantity. We believe the supply and demand we can unlock in this effort will further accelerate our flywheel for years to come and that this launch couldn’t be more timely given the economic uncertainty present for many American households.”
A One-Stop Resale Shop
“What’s special here is that even though it’s a peer-to-peer model, it’s going to be really closely integrated with our managed marketplace, so it’s going to still feel like shopping on ThredUp,” said Rotem on Retail Remix. “The peer-to-peer sellers are going to get all of the advantages from the investments we’ve made in artificial intelligence, whether that’s the pricing algorithms or the ease of listing an item or even potentially leveraging our AI model photography — we are going to put all of those tools in the hands of our peer-to-peer sellers.”
And all for free — ThredUp will only make a commission when an item sells.
Buyers will be able to view both types of items (peer-to-peer or managed) together or separately within the ThredUp app, so they can browse items however they like, “very much like if you think about Amazon, the ability to shop 1P or 3P consistently,” Reinhart explained on the earnings call. “This is a very well-established convention in commerce these days. Consumers will be able to flex in and out of it however they like.”
To learn more about ThredUp and the tailwinds driving its current growth, check out this episode of Retail Remix, here or anywhere you get your podcasts:
