Cellular App Letgo Raises $one hundred Million From Naspers To Take Over Classifieds In The U.S.
Can a cellular categorised app topple the behemoth that’s Craigslist? An firm referred to as letgo goals to seek out out. Its app, which lets customers purchase and promote gadgets regionally, has quietly grown to over 2 million downloads since its launch earlier this yr. And at present, the corporate is saying having raised $one hundred million in Collection A funding from South African media firm and tech investor Naspers Restricted, which additionally has stakes in a variety of sizable tech corporations, together with China’s Tencent, India’s Flipkart, Russia’s Mail.ru, and classifieds platform OLX.
In reality, the OLX connection comes into play right here, as letgo founder Alec Oxenford beforehand co-based OLX. Oxenford nonetheless serves as Chairman to OLX, which serves over 240 million customers in rising markets like India, Brazil and Poland. That have provides him a strong background within the on-line classifieds area.
However with letgo, each Oxenford and Naspers are on the lookout for entry into the U.S. market.
“Letgo is completely tailor-made for the standard American shopper,” Oxenford explains. “It’s a enjoyable, straightforward to make use of, and extremely visible cellular market that permits customers to publish, purchase, promote and talk with one another immediately and free of charge.”
Nonetheless, the app isn’t with out vital competitors stateside, the place websites like Craigslist and on-line marketplaces like eBay nonetheless dominate. However Oxenford thinks he can do higher, because of letgo’s give attention to cellular.
“There was a scarcity of innovation within the U.S. classifieds area, notably on the subject of cellular,” he says. “We expect letgo’s cellular first design, which is streamlined to make shopping for and promoting regionally simpler and quicker than ever, is a key benefit for our platform.”
From the buyer’s perspective, letgo could be very easy to make use of with its clear and trendy design, use of clear imagery, and built-in chat. After downloading and putting in the app, it solely takes a number of faucets to listing gadgets on the market or to speak with a vendor for those who’re fascinated by shopping for.
If something, the app reminds me of Fb’s Teams which, although a broader platform for creating on-line communities, immediately has a big variety of teams devoted to native promoting. Very similar to letgo, Fb Group members can shortly publish gadgets, view one another’s profiles, and kick off personal chat periods by means of Fb Messenger.
Letgo is principally the non-Fb model of what in any other case appears to be an identical purchasing setting. However one benefit letgo has over Fb is that Fb solely allows you to seek for gadgets throughout a single group, when you could belong to a number of native promoting teams. (I belong to a minimum of a dozen, for instance.) That may make searching down a selected merchandise difficult.
Plus, Fb chats between consumers are sellers are sometimes missed as a result of Fb pushes all these messages to customers’ “Different” inbox, which is the place messages from non-buddies reside (at the least till you reply). And since you’ll be able to’t get to your “Different” inbox from the Fb Messenger app, Fb loses its cellular benefit.
Maybe that explains letgo’s traction. Since its launch in February 2015, letgo customers have posted greater than 500,000 listings and exchanged almost three million messages. And whereas the precise transactions happen offline, Oxenford says that the entire gross merchandise worth of these offers is over $25 million. Shoppers are utilizing the app to purchase and promote a variety of things, together with issues like bicycles, furnishings, attire, and automobiles, for instance.
Provided that letgo isn’t taking a proportion of the gross sales as in different on-line cellular marketplaces, it’s unclear at this level how the corporate plans to generate income. For now, the app itself is a free obtain and free to make use of. The founder declined to element letgo’s enterprise mannequin or supply information associated to income era.
For now, that’s as a result of letgo is extra closely targeted on gaining traction within the U.S. market. Already, nearly all of its customers hail from the U.S. or Europe, however letgo plans to launch an aggressive advertising marketing campaign concentrating on U.S. shoppers within the months forward.
Even with out the advertising dollars, letgo has grown an honest-sized viewers, and it has turn out to be a prime 10 ranked free purchasing app in Google Play within the U.S., Sweden, Turkey, New Zealand, Norway, Italy and Spain.
Along with increasing its U.S. footprint, New York and Barcelona-based mostly letgo additionally plans to make use of the brand new capital to develop its group, which at this time numbers 39.
“Alec has distinguished himself as an skilled with a unprecedented monitor report in cellular e-commerce,” stated Martin Scheepbouwer, CEO of Naspers Classifieds, in a press release concerning the funding in letgo. “We’ve seen firsthand Alec’s means to execute on his imaginative and prescient as we labored collectively to construct OLX into the worldwide pressure it’s in the present day. In letgo, Alec has constructed a platform that’s completely tailor-made to the American shopper, and we’re excited to assist his group take it to the subsequent degree.”