So the business scaled very fast by middle of 2013 through 10 to 15x It felt like everything was breaking. We had hundreds of boxes thrown around in our offices. Sometimes the service would crash. USPS had just right at the doorsteps and said that we might want to sort of take your CU into jail because you're violating all these USPS roles and said, you know, I'm going to cut down our growth by 80%. I'm going to cut down my marketing spend by 80%. It's a difficult decision.
This is James Currier with NFX, where a seed stage venture capital firm started by a group of entrepreneurs. The NFX podcast aims to discover for founder community, what it takes to build iconic companies. Today, we're here at the Posh Park headquarters in Redwood City, California with Manish Chandra. The co founder and CEO of Poshmark. He's one of the most successful online marketplaces of all time, and truly the most amazing story you've never heard.
This is a company that has more people making money on it than Airbnb, Lyft, Uber, and Etsy combined. So a quick background, When each Chandra founded Poshmark in 2011 with Tracy's son, in my Beller, it's the most brilliantly conceived and executed social commerce platform in the Western It's the social commerce company by which all others will be measured. The companies raised a 160,000,000 of venture capital so far, and they've recently welcomed a new board member in Serena Williams.
Who's extremely active in fashion, technology, and now in venture capital. Manish and I have known each other now for 15 years, and we've been working together for 8 on Poshmark. Today, Manish is gonna take us inside Poshmark and share for founders what it took to get here. It's fundraising, developing as marketplace dynamics, network effects, and the personal growth that goes along with it. I believe we're going to be hearing a lot about poshmark over the next 10 years. Why?
It's clear to me that the network effects are just beginning to kick in. So we're really just at the beginning of the poshmark story. So let's get started. So we believe that behind every iconic founder is a fascinating story about their childhood. What was childhood like for you? Yeah. I grew up, in small towns in India. And my father was a judge, so we would get transferred every 2 to 3 years. The theory in India was that if you transfer judges, they wouldn't be corrupt.
And so that was sort of, one of the reasons you were transferred. So I had to be very quick to sort of settle into a new school, a new sort of society And that was part of my growing up, you know, in in being this very flexible, adaptable sort of process. I was, send to spend my summers with my grandfather. And my grandfather owned a large sort of wholesale pharmaceutical store in the middle of a place called Chomni Chok, which is a hustling bustling marketplace in Beller.
And, it started to go there when I was eight, And in those days, there was just sort of level of freedom. So even at 8 or 9, I was free to roam around the entire bazaar. And, now that I think about it, I don't think anybody would allow their kid to just walk around on their company. And, don't know how it affected me, but just seeing people talking, haggling, hustling, I think definitely gave me an appreciation of the power of the world of commerce.
So all these movements, sometimes people would lose a year or 2. I somehow ended up gaining a year or 2. I I finished high school at 15 and was admitted to, a school called IIT Kanpur, and, I wanted to go to their computer science program. I think there was definitely a meme all of us were applying to United States and and colleges. And for me, I was very much influenced by, an author called II Morgan, which was, you know, all about objectivism and freedom.
So my whole sort of thing was would it be not place where people are highly objective, very free, not driven by by norms. And what brought you to Silicon Valley? So my 1st 15 years were spent in enterprise software. I worked for, I would say, progressively smaller companies So when I was at Intel, there were 10,000 folks, then slowly realized that the database was not their core business. So I wanted to look for a real database me. So I chose surveys, which was a very small company at that time.
So I joined them in over 80, ninety people by the time I left 5 years later, we'd gone through a public offering, and they were 6 1000. And then you went on to join Versada. Why? I felt like, I wanted to be part of a startup again. That service had become big. So I ended up joining an 8% company. I was the head of products at that time. So that company started to scale, and we took that company public in 2000. And that the peak when I left them, we were over 600 people.
Was this when you started to think about starting your own company? So 0304, we were rebodeling our home. And as we were remodeling our home, the shopping was really, really hard. And it's it's sort of very hard to imagine today with, you know, mobile shopping and all kinds of sophisticated things that exist, what the world was like, but it was really, really hard.
And so I started to see the need for this product, which was collaborative shopping kind of a product, getting everyone on the same page. And, I kept rejecting it, saying, you know, who am I to do I'm an enterprise software guy. I have no idea of consumers, no idea of advertising, no idea of what the experience should be like, for almost like 6, 9 months, it kept saying, no, no, no, no, no, no, and then the desire or sort of, the idea would go go away everything Beller like a nail.
So your first consumer startup was called caboodle, and it was a social bookmarking app for commerce. But how did you make that jump into consumer? Around that time is when I started to sort of put together a group, which was, how could I connect to the best minds? And so consumer. And that's when we first started to meet and connect around what was us saved. And, you know, Reed Hoffman was there in that group, David Morgan, some of the really Pete who are coming together.
And I got to visually start to learn from some of the best thinkers. And one of the things I remember from those times is how to rethink and rewire my brain. Enterprise software is a lot about productivity, shortening the cycles, you know, messaging versus consumer software is a lot more about how you feel and how it makes you feel and how you sort of engage with them. It's also about productivity. It's also about other things, but ultimately, the emotion part.
And that took some time for me to transform through that journey. I'll tell you the number of people who from enterprise software who have tried to do consumers Tens of thousands of people and the number who've succeeded is so low. It's so hard to make that transition. You really have to have a flexible mind and even a flexible heart, if you will. Right? You have to have such levels of empathy in order to make that switch over because you've been successful in your other markets.
You've been successful at your other jobs. By doing things a certain way. And so your synaptic patterns get built around that, and to adopt whole new synaptic patterns, which are alien, is so hard to do. I mean, that's a true, amazing accomplishment to make that transition. But there's gotta be something you're doing behind the scenes that enables all this. What should founders understand about what you were doing that made all these great moves work?
Kabuto in many ways, was the predecessor to Pinterest in terms of, we coined the term social shopping, but there were many sort of things around simplification that we missed in that journey. So if it's successful, but it could have been way bigger at my thinking there.
We were trying to do a lot of biz dev and partnership and distributions, which don't work when you're trying to perfect the consumer Pete was stuff that we could tap into from a network effect perspective that we didn't enhance in in caboodle days. Yeah. When you're running at startup, so easy to follow every opportunity. But we do a lot of work with our founders, right, pushing them to simplify and simplify to focus on the 1 or the 2 things where they get the most leverage.
But the things that I loved and learned from Kaboodle was the power of community. We Beller a very passionate community Morgan few million users who were very connected, very passionate users. The second was just understanding people's connect to their products, and how sort of they think about it, including fashion and lifestyle. And third was the power of simplicity.
How simplifying and progressively simplifying leads to scale and seeing where we had gaps and seeing where we could, imagine And then the last piece was my insight and sort of looking at caboodle and looking at where we could take it is, the analogy I sort of give is the power of a coffee cup and power of Starbucks, which is how big something can become is as much in your imagination. If you think of a coffee cup and you look at a coffee cup, somebody can just look at a coffee cup and drink it.
Somebody can imagine a coffee cup into a coffee cart and create a small coffee cart. Somebody takes it into a coffee shop. Somebody takes it into a string of coffee shops, but there was someone who looked at a coffee cup and imagine a whole Starbucks. So I think the power of reimagining what something can become was also clear to me as I stepped out of Kabula and at all the things which we're taking. And recently Pinterest went public. Congrats to Beller.
And sort of an idea where Ben was able to remap that where my imagination ended at Kabuto, he was able to reimagine to make something very different. And so when I committed to a Boschmar journey, it was to serve 100 of 1,000,000 of Pete give them the power to be an entrepreneur, but do it through a very social platform, which had very fair playing field, easy and ultimately create the largest fashion and lifestyle platform that would be bigger than any other fashion lifestyle platform.
That's sort of the journey we are when did the light turn on for you? What did it happen in a moment when you came up with the idea for poshmark? Because I gotta say, you know, in 2011, you and I and Tracy's son are sitting on the floor of my office, my home office in Palo Alto, and we're editing your deck, and you haven't raised any money Pete. And we're talking through what's kind of work.
You described a product to me and a business plan to me that it's the most invariant business plan I've seen in my career. It must have come to you at a moment. It must have come to you over several weeks. Well, how did this, you and Tracy talked about it? How did it come to you? I remember, seeing iPhone 4 in August on in a vacation. My friend was using it.
And that, phone was so powerful at that point in time, both in its ability to capture pictures and transmit pictures and view them simultaneously. It felt like it would be transformative. And then right around August or September, I saw this little app. I think, it was called Instagram. And the combination of all of these things re clicked and and sort of the idea of poshmark was reborn in my mind very, very clearly at that point in time.
Tracy that night happened to be at Mayfield, I've waited for her, in SF, and then the 3 of us Pete. And, I kinda described the idea to her, and she was like, okay, this finally makes sense. And so that's how we started the journey. In that whole process. The difference I think was, between my previous journeys was I was much sure about my thought process. I was much more willing to bet all on a single direction and the simplicity didn't scare you. It actually delighted me.
So it was very simple process. And we said we're gonna only do it on an Iphone, only in mobile, which was very contrarian. Yes. It was. Yes. It was. And, we were going to keep everything very simple. We're gonna charge a flat commission. We're gonna have a flat shipping system. We're gonna take care of all of the daily things and the discovery model would be entirely social. Now these are a bunch of bets, mobile, social simplicity, etcetera.
They were very contrary, and each of them were somewhat contrary into what the norm was at that point in time. But you felt very certain about it. And and, you know, Navin Chadda, who's been with you through this whole journey of of Pashmark, once he wrote the business plan, he's he's just been stalwart in his Beller. Naveen, you Yeah. Conwal, and, and Jeff Klaviyu, we're all sort of there.
But I remember many of them just trusted me, and then you were helping me in terms of thinking about the network piece. In fact, if I remember the first name we came up with, of how to position the product was fashion, shopping network. And in fact, in some ways, the the whole sort of power of this social commerce as we think of our selves today was really this world of network commerce.
And, and I remember brainstorming and coming up with those vocabularies and words with you and Stan, and those have largely still been there. It's it's sometimes counterintuitive as product Pete, right?
But we found with the most successful companies that when you really think about the language, the descriptors of what you're building, and you articulate this to the whole team who's building the product, it it's very powerful because it can literally change the way your team builds, which is what you're saying is happening. In three months, we had a basic prototype out that we were starting to test in the market. And, through that 1st year, we had 100, 150 users total, right?
The goal was to get most of them active. And our marketplace, even it's a 2 sided marketplace, there's a high rate of participation, both sides, because of fashion. That was very unique. And and ended up causing a lot of problems later on in terms of just understanding what we were doing from a data Pete factor. But that time is exciting because we could activate a person called buyer and sellers and sellers were buyers.
That's where through that process of discovery, we came upon this notion of posh party which is our virtual live parties, which have been a whole engine of growth for us. That was sort of the phase of, I would say, market discovery market fit and just seeing if people will actually use these things. And, a lot of things we did was actually through physical events. We would get together with the users, teach them how to take photographs, and it was early.
So we would actually hand out iPad videos, which is, people may not even know what it is today, but it was like an iPhone, but without the phone. I touch I touch. I touch. I think that's the word. And they they used it. And they started to post photos because nobody, many people didn't have a phone at that time. And so Instagram hadn't taught everybody to take amazing photos. They were trying to. It was it was very early.
Then the 2nd phase was really we we felt like we were starting to see something really interesting. And one of the things to me in the early stages of consumer product, and, and we don't remember talking about it in 'six, 'seven' on this topic is really that the best way to understand a consumer product is engagement and return rate of your users, not growth. And that was incredible when we launched.
We only had a 1000 or so users but the average engagement time was 20, 22 minutes a day, which is today, 26, 27 minutes a day, 6 to 8 engagements a day. Today, it's like 23 to 27 minutes a day. And so that was to being very, very powerful. People were still buying a little bit, selling a little bit, We didn't have surge. It was all social, and the parties were working. People would hang out for the whole party, but there was no distribution angels.
There was nothing really at cost of distribution was insanely expensive. They were really crude ad networks that were available. Unbelievable. Was hard because I mean, we were only getting from them from the web to the down. It was hard. Very, very hard. We didn't have an Android product. We didn't have a men's product. We were just women, iPhone, no web, either we decided to just start to throw some physical events.
So we took this virtual posh party that we have into physical events, and that turned out to be a surprisingly interesting growth engine for So we threw probably in the first half of twenty Beller. I would call it a form of growth hacking and, but also helped us continue to scale the community because we had this high touch Flint for different folks. And then they were right there in the room. And you could ask some questions. What do you like about this? What do you like about that?
And it also encourages the whole team to come to the posh parties and see the enthusiasm of the consumers and realize that this is a wonderful company to be with. There's a wonderful product to work on. It's a wonderful community to be part of. And get everybody energized and excited. It's, kills about 18 birds with one stone. Right? It did. It did. It's been the 3rd phase was in 2013. And that was what I call scaling and understanding the power of scaling and managing it.
And I remember still have this vivid memory a conversation. It was, like, January 16 2013. I was lying on a Saturday morning in my bed and talking to you on the phone. I was, I think, in between some soccer games, I think you found time to talk to me. And we were talking about how fast should the business scale. And he was saying, Manish, make sure that it's not super fast. And that time I was like, gung ho, let's go. And so the business scale very from 2012 2017, we grew 10 to 15x.
There's really interesting distribution engines that have come around, etcetera. To the point that by middle of 2013, it felt like everything was breaking. We had hundreds of boxes thrown around in our offices, parties were not scaring. They were crashing. Sometimes the service would crash. USPS had just arrived at the doorsteps and said that we might want to sort of take your CEO into jail because you're violating all these USPS roles.
All of our payment providers had said that you need to find another payment provider. We can't really report your payment method, even though it was so secure. And in the middle of all of these things, we were trying to figure out what should we do around financing and So I mean You mean the fundraising. Fundraising and sort of the next level of sort of, because we're spending money fast. You're spending money fast and we were and the unit economics of the business Pete due reiterating.
Not that the engagement of the users was really high, and the community was very fast, but just the whole sort of system was not yet there. So it was So I took a step back and went back to Naveen over at Mayfield and and Mendelwood invested and said, you know, guys, I'm going to cut down our growth by 80%. I'm going to cut down my marketing spend by 80%.
And part of it is I don't want to just basically get into a place where we are effectively continue to spend money like crazy and not grow and, and, and effectively go into a bad situation. A difficult decision. It was a very difficult decision in particular because there was about 8 other VC backed companies in the online fashion space at the time. And the competition in TechCrunch and every place else was everywhere.
There was so much pressure at the board level and from everything else for you to just take the mark and win and grow at that moment. And you looked at those metrics and you realized that it wasn't gonna work. It was not gonna work. System wasn't there. It was not the right thing to do for our community either because we were not servicing them correctly. So we cut down our marketing spend by 90% So at a time when you're growing fast, you have competition biting at your heels.
Everyone around you is pushing you to hit the accelerator more. You push the brakes. And this moment right here, this is critical because you're betting everything on a few key strategic moves. What were they? So the thing we had to do at that time was rebuild our partnership with the USPS, which led to the creation of Boschbos, which is Countries for sort of fashion and lifestyle shipping label, which has been a fantastic sort of partnership, which allows So, isn't it? We do F or something?
What are the first Yeah. So label p, it's basically you can put as much stuff in any kind of box and ship it across the country. It goes priority post up to £5 and it's a flat rate. And you worked with the US postal service to develop that, define it, Pete it passed, get it approved, and launch it into the system All the way to the postmaster general and All the way to the postmasters, particularly to support the shipping for poshmark.
And that's why you shipping for poshmark, and our vision was that anybody who sort of has to ship something shouldn't have to worry about how to ship it, how much it'll cost them to ship it, the thing about fashion is that people may spend a week or 2 deciding, won't they decide they want to wait it tomorrow? So we wanted fast shipping We have 5 plus million nodes across the country shipping. So it's a highly distributed network to each other.
Today, we have 5,000,000 people who are selling and shipping their fashion on Poshmark, using the Poshmark label. So I, as a user, decide to sell something, you'll let me print out a label, which I can then stick on any box with this with this posh label for the USPS And just ship it. And just ship it. It just goes. And so five million people doing that today in the eyes. It's super simple. So anybody can get started, you know, on that process.
Know, you know, I wanna point this out because as founders think about what they're doing is hard, come on, man. You got the US postal generals change the whole rules to support your business. So for the founders who are listening, like, think about how deep you need to go to build the kind of company you wanna build and you need to do something like that or beyond. Okay. So big bet number 1 was on shipping. What was the second bet you made?
We also want to take away every non essential pain from our seller community. So the second thing was payments. So we were end of 13 and every single payment processor in the country, every single one of them, and they're all today chasing us for our business had rejected us. Then something happened at the beginning of 14, which was, I would say, lucky for us, is Baintree, which was an independent company, got acquired by PayPal.
And while PayPal Omri Braintree individually couldn't support our business model, combine magically they could. And so we got this lucky break of this thing, and we had actually signed up with signed up with a payment process who had agreed to support us And at the last minute, asked us for a 3 month escrow, which we are our balance sheet couldn't handle that. So we had to walk away from them, and that led to creation of Bosch pay, which is our unique payment processing team.
The third thing we try to fight, and we only just recently succeeded, is we wanted to create automatic collection of sales tax and remittance for our sellers. We went to the governments and asked them that we wanna collect sales tax for you. Right. And give it to you. And give it to you. They wouldn't allow us to do that. So for a year, we kind of kept collecting sales tax with the hope that one day they'll allow us and we'll remedy them. They didn't.
In fact, they forced us to remedy back to our sellers to the buyers. I'm I'm happy to say that just about a 2 months back, we finally launched Bosch remit, which collects sales tax on behalf every single state government city and local government in the country that wants tax to be collected on behalf of our sellers and limits it back to them. Partially. It just recently launched. It took 7 years to get there. And so now at this point, if you think about it, your shipping is simple.
Your payment is simple. All of the government integration is simple. So you can focus on 2 things that sellers love to do, which is how to merchandise their product and make it easy to have the commerce with their customers. And that's the magic, sort of what we've created, but it takes a long time. So going back to your advice from a, from a founder's perspective is really, you have to stick to the customer experience.
If you're not focused on the customer experience, in this case, both the seller and the shopper and simplifying the world and simplifying the world and simplifying the world for them, I think somebody else is gonna come and take it over. In any area that we have laps, there is probably somebody else who's doing it for them. And that is sort of something which is our core pursuit is to make it easy on both sides.
Getting the government to change, getting the postal service to change, getting the payment provided. These are some of the hardest people to get to change, and you've you've had to go through it all in order to make poshmark what it is. And that's, that's sometimes what it takes. That's incredible. So talk to me about the social aspects that you built into the system at first. Right? This is a very unique platform because it's social commerce.
In many ways, it's it's a unique place because fashion is such a large sector of the economy, maybe as big as real state, you know, for the Airbnb and poshmark for me appear to be sort of the leading companies for building these marketplaces. It's also unique because of the level of passion, and that that people have for it, the frequency and the passion that that the the buyers and sellers have is very unique. It gives you an opportunity to build a social commerce product unlike any other.
So it's good fertile soil for sure. You didn't make that up. You you saw that and you dove into that fertile soil. How did you till and then, and then plant that fertile soil? What were the features that you feel like really started to get the social part of the commerce? So social was very core to what we Beller, and it is to mean when we think of community and social, you can't make it a feature. It has to be embedded in the very soul of your product.
And I think every product and every, platform is at the end of the day of community, whether you consciously inculcated or you unconsciously inculcated. We're part of a community. That's how we connect it as as a venture community, but I would say for us, the first insight was how do people connect around in particular, how women connect around fashion. And, one of the things, for example, in poshmark, we don't have is public ratings of sellers.
Which is very contrarian to almost any other marketplace in the world. Reason we didn't do it is because when you leave a rating on an item that's in a closet, it's almost like you're personally rating the style of that person. And so a 3 star rating Flint 3 star on the transaction. It's 3 star that reflects by personal style. Imagine how you feel as if that happened. So it was built with that empathy. Second thing was we took what there was no private communication.
Between the buyer and sellers. Like everything. Everything is social, which was a big risk for both the seller and buyer. What if somebody got into a big Flint. They they do. I mean, occasionally, but the openness of the conversation actually inculcated good behavior. And transparent behavior and a level of sort of transparency on the dispute and the conversation.
And in fact, many people have told us the reason they like it our platform is because they don't get strange direct messages, you know, in the in the system. And then the third thing which is there, on the platform is that there are so many ways to connect Pete, and everything happens to the people discovery and the connection of the Pete.
So so when you think about sort of social communications, no public rating, and and a lot of sort of social discovery, and initially you connect and you follow people, those were sort of the foundations of it, but the magical glue was the following notion, which is as you are listing the products, as you are shopping the products, you can also curate them. So there is this button called the share button.
And what happens with that is you can share your own items to your followers you can also share somebody else's items to the followers. Now if you think about that, that was one of the most controversial features that, you know, we Beller, and I was sort of very much pro it and in various point I might have to defend that feature. Even today, people tune into it, but this is such a powerful thing because it's this one button which really allows products to be propagated in different things.
Into parties, into styling, into your followers. And now for a seller curating that allows them to show their style. Mhmm. Right? I don't know this, but I like this. Exactly. So their followers get a greater sense in their style. And it allows the followers to discover new sellers. And so beyond sort of curation of items, it also is a way for sellers to connect their followers to other sellers.
So we're probably the only marketplace where sellers actively spend anywhere from a fort to half their time promoting other sellers, which is very strange. Right? It's very strange. And it's very unique to you guys, and it's another rule that you've broken that, that fits with all the other rules you've broken. And This balance between following people, but then looking for things to buy is a very delicate one, right, because it's generally about people.
But if you don't focus on the items, then the conversion rate goes down, and you want the growth of the company to go up. So maybe you need to focus more on the products and not less on the people. But maintaining that balance, that flying that plane, as I say, between the commerce part of it and the social part of it, I think has been one of the more remarkable things you guys have done, and I don't know that many other people who've even tried it, let alone anybody who's accomplished it.
This idea that you could get them to to share other people's closets, other people's items to to sell where it doesn't benefit them at all other than socially. But it does benefit them socially because there's such a amount of of value placed in the community on your reputation, right, and how who you're connected to. But without the ratings. And that's the critical thing. Yeah. So ultimately for us, the the balance between what I call love and money is so critical.
One of our core values is lead with love and money follows. When you lead with money, nothing happens. And my personal sort of belief is that when you look at a decision you have to make, when you look at an experience you wanna create, there's three places from which you can come and make that decision. 1 is a place of fear. I'm afraid of competition. I'm afraid somebody's gonna kill me. The other is a place of greed. Let me have more of it, more of it. And third is sort of this place of love.
A lot of times when you sort of intentionally feeling afraid or feeling scared or feeling depressed. If you can center yourself and make that decisional place of love, you always win. And I find that to be very true about product decisions that we make around that evolution because there are times you feel oh my god, the sky is falling. You know, the business is not growing or this is not happening or that's not happening. There's a place of fear.
Then there's times where some things are going really good. And the idea is How do we raise price? How do we maximize that? Right? But neither of those are good places to be. Because when you create a virtuous cycle, you serve your customers and you come from a place of love, then you create a perpetual wheel and a perpetual relationship that is beautiful and winning.
So if you look at one of the core principles for us is There is nothing that we do, which is really making money Morgan from sellers. We all make money together. We make money when we serve a and our goal is to empower our seller community, serve their customers Beller, but they serve their customers better. Customers come back and build a deeper relationship to the Beller.
And ultimately, as they sort of scale their businesses, we scale our business in our platform, and it becomes a very symbiotic sort of partnership. Yeah. But, Binesh, how do you come from a place of love when most people are operating from fear and greed? You're surrounded by good Pete. They've grown up with fear. They've grown up with greed, or they've learned greed. How do you how do you do that personally? And that as as a leader?
I think, one of the things that, you know, if you think about it, we all have tremendous, what I call, existential angst, right, and it comes at different points in time. Meaning, meaning. Meaning it to be. Am I valuable? Am I valuable? Am I good? Am I loved? Am I worthy enough? You know, how do I compare myself to other people? So What's my existence mean? What does my existence mean?
So there's many principles we've tried to do at different points in time, then that's been very magical to our culture. And, you know, you continue to have to work at it. So it's not that you can get rid of initial gangs. It's part of our life. But what can we do to help alleviate it? How can we make the playing field Beller? How can we make it sort of it's more transparent. It starts from how we compensate people. It starts for how we inculcate growth.
So if you think about every one who joined us in 11, 12, in the early years is still here. They're still all grown. And we've certainly added, I think we were 20, 30, 40 people down, and we are four hundred people down. So we certainly added more people here. We're four hundred people down. Yeah. But continue to grow every person through that journey. So we have folks who joined us, who are maybe doing something completely different.
Maybe they were, working in the front offices of a retail outlet who are running a team of maybe sixty people today in the company or someone who may have never been in a company more than 10, 20 people who's now in a senior leadership position.
So inculcating growth internally and the same time for our seller community, providing them with ways of growth, we've had people who came in and maybe sold a few items from their closet and now run 2 different fashion brand lines on Poshmark with thousands of other sellers carry their brand on poshmark and they're scaling to 7 figure businesses. So it's both continuing to grow internally because growth in my mind to happiness.
And then the second thing is how do you sort of remove some of the common angst that happens as much as you can. Right? What I hear you saying is you you've gotta identify and then demonstrate abundance to the people in Very beautifully said. As always, you have the better way of expressing what I'm saying to you. It just it's it's it's a Pete, but you're actually doing it, Manish. That's the thing. You're doing it with with how you're running Morgan and what you're doing for your team.
The fact that everyone from the beginning still here after 8 years. Think about that. That's amazing. Well done. When you think of some of the the harder times, I mean, you know, look, you guys are just getting going. You've got another 10, 20 years of of growth as as as a company and as you as the CEO, you can go forever with this. You can go into home and fashion, you know, home products. You can go into men's and babies, and you've done all that.
And, and you're now becoming this this platform for buying all sorts of things, from people, you know, social platform that we all hoped we would see 10 years ago is now coming true. We're just getting going, but what are some of the things that you had to get over to get here? What are what are some of those moments when it sort of the worst.
And you're gonna have to get through some of those moments maybe in the future, right, when you wanna go from, you know, four hundred people to 4000 from 4000 to 40 you know, you're gonna have to get through some hard times again. How did you get through some of the hard times? What were some of the hard times and how did you get through them? Well, I'll give you one time frame, which was I think I mean, 2014 was an interesting year because we didn't have much money in the bank at that time.
We were operating this company trying to grow because this was the time where we had tall growth and we were growing again. And, we recruited some amazing leaders who are still here. You know, John McDonald joined us in late 13, early 14, He's a chief operating officer today, Barker, who's a chief data officer joined us. They joined us because of the strength of conviction. I was very transparent for them, you know, where we were much money was left. Yeah. And what's there?
The growth rate was at this time. It wasn't. It wasn't there, and they all, you know, are still here to help us grow and then, you know, work through There Pete amazing times in 14 to learn the level of learnings we had. What we discovered is how much love our community had, even when we'd cut down all of marketing, the business was still growing because of the intense engagement our community has in around the platform. But, fall of 15 where we've grown very, very fast.
And, we had, at that point, been rejected by 200 different investors. If you name an investor, we would probably pitch to them and gotten rejected by them, right? It was a crazy time. We were, I remember sitting with Tracy at this, coffee house in San Francisco as one other investor who felt compelled because really loved us, but they wanna give us money to call us and tell us that, you know, sorry, I can't give you the money. And I was like, I don't even wanna take this call.
I know what he's gonna And and it was it was a really difficult time. But, you know, one of the things that happened in that time frame was, you know, for me, our mindset is, you know, continuously learning So everything that's bad, we learned from it. 1 of the investors had asked us to provide them with data in a very specific form. And so as as I was looking at that data, we were giving them, and I don't know why this I was, like, frustrated.
You know, there's another kind of data that these guys want and grumpy because, you know, it was, like, getting painfully end of our, investment rounds. And, and that that data was being cut and and and put together, I looked at those numbers. And what was funny was this entire spreadsheet of maybe 1000 cells had the same number or close to the same number. I said, what?
It was a and what it told me was how robust the cohorts of the platform world because we've never looked at that from a different perspective, which allowed us to make judicious business decisions in the future and turn sort of the exact economics of the business around. And so one of the So there was an investor who was gonna say no to you. Who did say no to us?
Did say no to you, but in the process showed you a way of looking at your data, which gave you an insight and you learned from that, you didn't just take their rejection and say, oh, they're idiots. You said there's something to learn here. Wait a minute. And that has helped you in the years after. Growth. And so what I what I find is that in general, when people are giving you feed it's very hard to accept it at the moment, but there's wisdom in it. Even in the worst critic, there's wisdom.
So even when my community today is up in arm, when investors are criticizing you, your your team is criticizing you about something. If you can, and it's very hard at that moment to take that feedback. But over time, if you can absorb that feedback, There is some wisdom in it. There's some ways to process any Beller. And if you, all of you grow, and I believe a business, if the leaders are not growing, then the business can't grow.
So a business doesn't not grow because of competition, doesn't grow because of investment. Doesn't, it stops growing when the leaders start growing. And so part of it was that there were Beller. There were sort of axioms in the business that had to be challenged. And that data challenged that Acxiom. And It broke something. Like, it broke the ice and broke broke a broken assumption. Yeah. That, oh my god. The system is sensitive to this data Flint, and it wasn't.
And that allows you to fine tune the system. Once you do, it unlocks a whole new sort of engine of growth. And many times you need a leader who believes in it on either on a distribution side, on a particular area, Right? So so, I mean, this is such a Pete example of where these decisions are unclear. You've got a very complicated business. You don't have the the team necessarily in place where they're just getting in place, you know, the capital is only a certain amount of capital.
You know, you guys had the the decision to move more toward new products, Right? Because it had all been used up until that, and now it's a lot more used, a lot more new than it was back then. The integrations with the fashion providers and and the partnerships with them was all still to be done on the women's side, and that could be a very viable way to go. And I'll be honest, that's kind of what I wanted you to do. I wanted you to Pete more into new and more into the and lock down the women's.
And then maybe year, 2 years from now, let's go after other categories then, but you're like, no, let's do it now. And Hans wanted to do it now, and there was all these different disagreements. And in the end, once you did it, it was hard. After you made the decision to go broad, the broadness kinda hard. Things weren't really taking off. And so it kinda looked for a year, like, well, maybe that wasn't the best decision. It took 2 years to actually fully make it work.
Right. And so I think this is just such a great lesson for all founders that there's all these decisions that we make that we don't know at the time. There's lots of good arguments on both sides. And in the end, you have to have a guiding light. You had that guiding light, which is I want to be the platform, and I want to do it with love.
And that ended up being right for you, because you and your team, Tracy, and, and Lynn were, have been navigating this thing from that perspective, and therefore, it worked for you. And had it been another team, it might not have worked. I I think there's another dimension, James, which, you know, you were sort of very, very important in that mentorship process is what are the decisions you make around your team during these phases of mass upheaval.
You remember that conversation, I think it was in 16 or 17 when we were talking about senior leadership in the company and how to evolve it. I think one of the pieces that I feel very proud of is that we've been able to add tremendous number of senior leaders in the business. And at the same time, continue to grow our original set of leaders into bigger and bigger roles. And this bridging, I remember it was one of your pieces of wisdom was that creates a strength that is really powerful.
When you have people who've been with you for a long time, married with people who are bringing in needed for the next phase of growth, and and bringing it together. And that to me, I think, is very unique about our company. You don't see that a lot in Silicon Valley where each generation of leaders kind of churn and, you know, the wisdom is, let's get the best people and these people don't scale and that Pete.
And what I found is that, you know, nobody interviewed me every year to say am I the right CEO for the next job. Right. I was just given that job. Right? So Yeah. You gave yourself a job. Yeah. So I I'd like fine. You know? And so why should people who are working this team not be given that opportunity? And that's sort of the ability to give them the right level of support, not just by me, but people that they needed to has allowed them to scale.
And what happens today is that we have both a true north which come from people who've been around for a long time and evolution and innovation and and and now our time, people become the true north because, you know, for example, somebody who joined 3 years back is there.
And that period of 16, 17, 18 was in tremendous year, we have lost 3 years of, you know, growth in senior leadership, growth in core leadership, for example, Ian who joined us in the early days as a community manager now manages a team of 150, 170 people that spans the world And so, so that's sort of seeing seeing her grow and take on that leadership role at different scales and stages has been a very interesting journey because as much as we
are growing as leaders, you know, if you can have the other leaders grow, and I really credit you for sort of that core nugget of wisdom about this bridging approach of of 1st generation leadership, 2nd generation, 3rd generation. If you can preserve the best elements, of course, some leaders will not work out and some folks in in and all of that. But broadly, if you can keep it along, it creates a much stronger business, much stronger projects.
If the new responsibilities Pete them in places where it it serves them, and serves their transformation, their growth. And we've seen that even in our community, we've seen people who have been with the community since the very beginning scale up. Some people for a couple of years left and then rejoin. And you've seen that in the company as well.
For example, Maria, who's heading up our Canadian team left the company for a couple We recruited her to now head up Canada and open up Boschmar Canada for us. So so it's just this ability to sort of create this ecosystem which can come together, take the business to the next level. Maybe there's different parts to the journey kind of go there and then come together and take it to the next level, has been fun to watch and Pete.
And that gives me, again, hope that the culture we've created both in the community and in the company can continue scale because scale and evolve, of course, and because it has to evolve naturally. But each of those things are very powerful because they are required for something to be healthy and viable Morgan long period of time. Totally. And, you know, you guys have a network effect now that would just will not quit, and we've seen how powerful those are.
And now you have a culture that will not quit. And, we've seen how powerful those are as well. The DNA of that, those two things combined tell me that this company is gonna be here for a long long time long after you're retired, which is gonna be another 2030 years, hopefully. So, now two two things I wanted to get at before before we end here, is there anything that we should talk about as lessons for founders around your fundraising journey? Very important.
I think, one of the things that I have found about the fundraising journey is that the market feedback on your business broadly is very accurate. Early days different, you know, when you're doing it on the belief. And if you don't take that market feedback, seriously and process it and factor it into your business, you will keep running against that wall. And whether that feedback is on growth, that's unit Economics profitability. Processing here is important.
How you act on it is, of course, up to you. And so I would say the 1st set of point in 14 when we went out, we got this feedback. We didn't take it seriously. We thought, you know, these guys just don't understand our business. In 15, we did. And there's a big difference, except at the feedback, we processed it then. And from that point onwards, every time I have a meeting with someone, whether it is a customer. Of course, you know, you take your customer's feedback seriously. Perfect.
And so why not your investors feedback and on the sale of your stock, right, And so it's very, very important. Yeah. And and there's specific suggestion on how to fix it maybe off, but their feedback on what how they see your business is gonna be important at every stage. And how you choose to act on it is yours, but if you don't act on it and you reject it, then you would not be able to build the business next level, which requires the next level of capital fundraise, etcetera.
And so so that has been sort of a journey that has been interesting at different stages on on fundraising. The second thing is the ability to simplify and simplify and simplify your message in terms of what you're trying to do and be able to describe it, is is is there. And third thing is as the business James, And then business has real revenue and and and real sort of, economics that are happening. At that point in time, the business is gonna be valued more from a you know, metrics.
Metrics perspective and and all of that, and you better have sort of an understanding of that. So those are different phases of the journey. Know, at the beginning, it's on belief and personality and on, you know, changes the technology. And then it's about, you know, the the core metrics and then and then later on, it's about the size of those core metrics. Right? And and those are 3 different audiences from a from a fundraising perspective, and they they have different languages.
And if 20 investors are giving you one feedback, particularly venture investors, and you're not processing it fully. And then you're missing something. Feedback would be around TAM, right, and you might be like, it's in a big business. Feedback could be around unit economic, could be around your cost of sales. They have real feedback. And a lot of times I find founders sort of disbelieving it and taking it very personally. And of course, I took it personally.
All of us will take it personally, but being able to process that and figure out how you sort of act on it so you can come back is very important. And come back in a simple way. I think I think your point about simplicity is so key. I think as founders, we we want our souls to be seen and validated. We want the investors to validate how complex our lives and our businesses are and how smart we are to have overcome what we've overcome so far and how far we've come.
And really, they just want it to be incredibly simple, because they're looking at another 6 deals that day, and they're like, what are you doing? Why? You know? And so it's it's, it's sort of a little heart wrenching to make it more simple and more simple, but that's what's required to actually communicate. And you find that's through the the customers as well. So having seeing those venture people as and those investors as customers, simplifying for their benefit is is part of the journey?
The other dimension, I think, in in the in the growth journey is being able to track and grow the team that you have. And I think making the room for people around you and and growing them is really, really important at each area of growth and financing, there will be people who will come and join your team who are gonna lead and it takes time to make room for them, right, at each stage. To onboard them properly. Onboard them properly.
Figuring out to work with them, the right partnership, how sort of bring it along and and at each stage because you're attracting, and then you find that founders who are able to do that incredibly well, you know, like Scott Cook or even Mark Zuckerberg and and many others, just have different scale of businesses that you end up building, right, because at the end of the day, it's all about not just the community you're creating, not just the team,
but the community of leaders that you're creating around you. So identify, attract, and then onboard Onboard. Integrate. Flint. Integrate. Yeah. And getting the best of that Flint. And And sometimes the talent comes through network. Sometimes you have to get people who are great professionals at it. You know, so executive recruiting is something that Flint people say, oh, it doesn't work, and I find it to be an incredible tool to get best access to the best talent out there.
And that money Pete 100100x ROI. Across the board. And that's super, you know, important. And the third thing is I feel like at each stage of the business, you have to change how you operate. And, last year, middle of last year, I was going going through this sort of 6 month process in the first half of twenty eighteen, but I felt like I was just writing from one meeting to the other and and just, you know, sort of, like, feeling very stressed and tired and exhausted.
And prior to that, I never felt that. Like, it was just sort of like I was like, what's going on? And so I sat back and scratched my head and said, you know, how do I sort of re vector how I operate? Because clearly I'm creating all of this stress. People are stressed. Everyone sort of energized, and we should be really energized. And so I created something called CEO time. Instead of going to meetings, now meetings come to me.
And what I did was each see your time is given to a functional leader who needs to engage with me and their usually they're repeated every week or every other week. They create the agenda. They prepare for that meeting. And in those 2 hours, they can either ask put a decision, educate me, brainstorm, inform me, or sort of change something, and their teams, and they invite the right cross functional teams for that. And those 2 hours, I'm 100% focused on them in their business.
So whether it is around data or product or HR or what have you, and you make a lot of decisions in that process. And it has completely streamlined my calendar. And then these executives are sort of rework it. I've stopped. You know, I can sit here and talk to you for an hour instead of running to 10 meetings because the calendar is completely restructured, and that has been a meaningful shift And I couldn't talk about it because I wanted to practice for at least a year.
Now it's been a year, and it's working reasonably well. I mean, there's stuff you have to fix. That's been very powerful for I wanna ask one more question, which is what's next for poshmark? So for us, we're very excited about 3 things. One is, including more of the world in, in our community. So we are planning to launch Boschmark Canada very soon and, super excited about it. So right now, it only operates in the United States. And only in United States today. So it's very exciting.
I think by the time probably the podcast goes live, we'll be in Canada. Second is we believe that our social commerce platform can serve beyond fashion. And so we intend to go into adjusting categories and sort of open up there. So the 1st broad category beyond fashion that we want to open up is home and home decor. Is, you know, in many ways, my consumer journey, 15 years started there. So I'm excited about that.
And third thing is coming up with new ways in people can engage with each other and interact with each other on platform. You know, things like video, things like styling, you know, different kinds of communication. So we expect to, to sort of evolve and, and, and energize around that. And so, which is, you know, again, the same think Morgan people, more ways in which they can transact and sort of sell and buy, and then just more love between them.
Wow. This reinvention, this constant reinvention, Venetia, changing, you know, the the places you lived every 2 or 3 years as a kid, And now you're changing how you run your business every 2 or 3 years. It's the same thing. It's it's an amazing superpower you have. That's amazing. That's a great way to end. Thank you, Manish. It's a really pleasure. Thank you. So that was Manish Chandra from Poshmark. Down Redwood City, California. This is the NFX podcast.
You can learn more about network effects, growth, fundraising, and building iconic companies at nfx.com. Follow us on Twitter atnfxgildnfxguild.