Faire’s Challenge to Amazon

Happy December! With holiday shopping in full effect, we're checking in on the state of retail.

With all the changes in recent years with respect to the way we shop, pay, and receive goods, there's been a lot of noise about retail's imminent death. Even before the pandemic-related closures business owners faced during the pandemic, several pre-existing conditions threatened the health of their businesses. D2C e-commerce brands sold mattresses, toothbrushes, makeup, and shoes, swapping in-store product testing for online reviews. Amazon made getting anything you can think of a one-click experience. Convenience and online branding seemed to make brick and mortar obsolete.

But there's strong evidence that retail is here to stay. Digitally-native brands are adjusting their business models to serve the public in-store. Moreover, despite the sheer vastness of Amazon's product lines and all the unique sellers, a lack of brand identity and personal connection remain for the end consumer. It turns out that this weakness of Amazon is a strength for up-and-comer retail wholesale marketplace Faire.

The company, founded by former Square employees, helps shop owners find and buy wholesale items to stock their shelves. Rather than throw the entire brick-and-mortar business model out alongside iPhone Xs, #metoo canceled celebrities, and other antiquities from the 2010s, Faire and others are trying to modernize how these retailers operate. So out with the trade shows and stacks of pending purchase orders, in with the sleek, digital retail marketplace. 

The company raised a $400MM Round G this month, raising its total valuation to $12.4BN. It plans to spend some of that money helping new shop owners buy initial inventory for their shops; Their Open With Faire program offers a $20K credit for the merchandise. Competitors include Bulletin, Abound, and Tundra, but those companies have only raised a collective $111MM compared to Faire's $1.1BN. 

While Small Business Saturday and supporting Black businesses are popular hashtags, people's values and actions don't always align. Is uniqueness or convenience at the top of your shopping list?