Interview with John Atcheson

John Atcheson
Co-founder & CEO
Stuffstr

We plan to be operational in at least 3 countries by 2020 end

US firm Stuffstr works on reducing waste by increasing the reuse of unused stuff. It aims to fundamentally change the way purchasing is done and even think about the things we buy, resulting in a dramatically more sustainable world. It lets consumers capture the value of used items, including apparel, footwear and accessories, regardless of their condition. The company partners with retailers to buy back everything that has been fully used, and gives those items a happy, productive second life. Co-founder and chief executive officer John Atcheson speaks about circular economy, consumer attitudes to closing the loop and collaborations.

How did you come up with Stuffstr? What was the initial seed capital you began with?

In the early 2010s, I helped launch Getaround, the pioneering peer-to-peer car sharing company based in San Francisco. For me, Getaround was about finding a way to use the 92 per cent idle time of the average car, which sits around doing nothing for 22 hours a day. Once Getaround began to grow, I began looking at all the other things we buy and was astounded by how much waste is being created. Eighty per cent of items are used less than once a month, and nearly 70 per cent end up in landfill, despite most of them being perfectly usable. It is almost an epidemic of waste. So I began thinking of how it might be possible to systemically change the flow of goods post sale. From the start, Stuffstr wasn't as much a company as a mission to solve a fundamental societal problem.

Once I began to bring Stuffstr together, I was able to convince Steve Gutmann, a colleague from Getaround, to join me, and we together raised $50,000 to get the company off the ground.

Who are the founders and key investors in Stuffstr?

Steve Gutmann and I co-founded the company and worked together over the early years to get the company started. Ultimately, as often happens with start-ups, Steve had to leave to take a steady job with a more predictable paycheck, and I carried on.

The initial investors in Stuffstr were all individuals who believed in what we were doing. More recently, we raised a more traditional seed funding round led by UK-based venture firm Mustard Seed, with Adidas, the London Co-Investment Fund, and a few high-net worth individuals as co-investors.

Did it take a lot of convincing retailers initially with the model Stuffstr is based on?

Once we landed on the instant buy-back model, conversations with retailers accelerated very quickly. We were fortunate we had known and respected the team at UK retailer John Lewis & Partners for some time, and they very quickly told us they would pay us to bring the model to the United Kingdom and pilot it first with them. Did it take a lot of convincing retailers initially with the model Stuffstr is based on?

Which were the initial apparel brands and retailers that partnered with you? Can you give a brief about the pilot tests and the response you received?

Stuffstr spent most of 2018 embedded at the head office of John Lewis & Partners in London, building out and executing its initial pilot. The pilot focused exclusively on fashion items, including apparel, footwear and accessories, and proved to be very successful. In addition to exceptionally high customer satisfaction (every customer who tried the service loved it), we found that the average participant sold back almost instantly nearly 20 per cent of everything they had purchased in the previous five years. This represented a dramatic shift in consumer behaviour (statistically, only around 2 per cent of retail purchases are ever resold through any resale marketplace) and attracted a great deal of attention from other retailers.

How many brands are you working with now? Is any major collaboration being planned?

We have a very big launch coming up this fall with a large global clothing brand and have in total 18 brands and retailers interested in engaging with us. Those 18 brands collectively sell over 2.7 billion items per year, and so our primary focus now is on how to process and resell high volumes of items.

What is the price and carbon and water footprint of recycling clothes versus using virgin resources to make new clothes?

The way we see it, every day the use of an item is extended is a day a new item does not need to be produced. Most people do not realise that the carbon dioxide embedded in household items they buy each year can exceed the carbon dioxide emitted by their car. So theoretically, if we can double the lifetime use of items (not a high bar given that 80 per cent of items are used less than once per month), it is the same as removing half the cars from the road.

In what way do you connect consumers with retailers who are ready to buy back old stuff?

The connection is very immediate. Stuffstr is embedded directly into the apps and websites of our retail partners, so the customer can seamlessly pull up their purchase history and see an instant buy-back price offered on every item. Once a minimum value threshold is reached, the customer can simply press a button and have the items collected the same day for free and receive payment in the form of an e-gift card as soon as the items are received.

What are the challenges you face in your day-to-day operations?

We have a tremendous advantage over traditional re-commerce players in that we know everything about the items we are receiving before they arrive (product details, original purchase dates, etc.). Nonetheless, we still have to process and re-circulate each and every item. Anytime logistics are involved, the devil is in the details. So we partner with experienced players to the maximum extent possible.

Are only the bigger brands tying up with you? What is your plan to reach more retailers-big or small-and form partnership with them?

Ultimately, our goal is to work with everyone, and to create a universal platform for re-circulating every single item. To do that, we need to work with both big and small retailers. Fortunately, small retailers are increasingly moving their point of sale systems to cloud-based solutions like Shopify, Lightspeed and Square. It is very easy for us to integrate with these systems, and we can cover multiple retailers with a single integration. This greatly accelerates our ability to expand.

Which are your markets where the re-cycled stuff is sent? How does the supply chain work?

We have big plans for the items that cannot be resold. In the short term, the options for these items are limited to the current channels for recycling. In the case of clothing, this could involve shredding items to serve as insulation or as stuffing for upholstery. In the longer term, though, we see Stuffstr as a platform for fostering innovation in the area of material reprocessing. For example, there is tremendous innovation going on right now in the chemical recycling of fabrics. Companies such as Worn Again can take blended garments and turn the cotton into new fabric while converting the polyester into reusable plastic beads. Stuffstr can aid the development of these businesses by providing a steady flow of specific materials, because we know the material content of every item.

How are consumers reacting to closing the loop and circular economy?

In general, we have found that consumers want to lessen the impact of their consumption; they want to be part of the solution. But they are dramatically more likely to do that if there is no additional cost or effort involved. Ideally, they act because it is actually cheaper and easier to do the right thing. This is where I believe circular economy-beyond traditional sustainability initiatives-holds so much promise. Circular economy represents a tremendous economic opportunity based on the principle of resource efficiency. Every day around the world, literally billions of dollars are wasted on perfectly usable items and materials being thrown into landfill. If we can capture that value by keeping all materials continually in play, everybody wins.

At Stuffstr, we have placed tremendous focus on making it easier, faster and more monetarily attractive for people to re-circulate their things than letting them pile up and ultimately go to landfill. Capturing the wasted value of these items-estimated at over $400 billion per year in the United States alone-is what enables us to benefit both consumers and retail partners with money left to run our business.

What is the amount of clothing, footwear and accessories collected so far?

Our pilot results give us a clear idea of what to expect when we launch this fall. It is a significant number. Maybe check back with us several months from now!

How does Stuffstr work? Do you have an app? Which countries are you available in?

We are currently targeting only the United Kingdom but have plans to expand to other countries in 2020. Our primary distribution is through integration into the apps and websites of our retail partners.

What are the plans going ahead? What are the major targets and goals set for 2020?

By the end of 2020, we expect to be operational in at least three countries, and to be a significant player in the re-commerce space in at least two of those countries. (HO)

Published on: 23/09/2019

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.