OfferUp is a local mobile marketplace competing with businesses like eBay, Craigslist and Facebook Marketplace.
The firm received $130 million in financing in 2016, taking the complete financing of the business to over $221 million, and was the only closely-held business firm in Seattle at over $1 billion, rendering it the only unicorn status in the region.
OfferUp software, which is available for iOS, Android and web, enables the purchase and sale of used goods. The marketplace, optimized for smartphones, displays big pictures of products for purchase through an infinite scroll design that is visually attractive.
The feature is called “Hold Offers” and it lets buyers reserve things they want and then complete the purchase using a QR code when two people meet in person to exchange the item.
The company wants to differentiate itself from other eCommerce rivals like Craigslist, Facebook Marketplace and eBay, and the new advance payment system is a big part of that strategy. OfferUp says that it’s the first peer-to-peer (P2P) marketplace that lets customers use Apple Pay, Google Pay and Samsung Pay as part of its digital infrastructure.
OfferUp CEO Nick Huzar said that he wants to make buying and selling easier on the app by making it happen in-app instead of using other apps like Veno or PayPal.
“By bringing [payments] into the experience, we can actually help if things arise in the transaction,” Huzar said. “But if you take it off the platform, there’s not a whole lot we can do.”
Integrated payments are common on online marketplaces but not so much for P2P transactions, and OfferUp is trying hard to differentiate itself from competitors. The company has amassed $260 million in funding so far, and it uses word of mouth as an effective tool for growth.
The company is popular though, and its app has been downloaded 80 million times with an impressive 44 million users. Many users spend about the same amount of time on OfferUp as they do on social media sites — a sign that the company has a loyal fan base. It wants to continue to grow to new markets.
When a buyer uses the “Hold Offers” button, the item gets marked as sold, and then OfferUp takes payment information to make sure the money is there to pay for the item. When two people meet up, the buyer will offer a QR code for the seller to scan. OfferUp accounts can be linked with all sorts of payment options.