Julie Wainwright is used to blazing new trails, having helped put luxury resale on the map with The RealReal Inc.
But now she’s laid out a data- and technology-reliant road map to take the company further — into profitability.
Last month The RealReal set its marker and said its adjusted earnings before interest, taxes, depreciation and amortization would be positive for 2024.
But on Tuesday, Wainwright, who leads the resale firm as founder, chief executive officer and chairperson, went beyond that in an investor presentation and laid out the company’s “Vision 2025” financial targets.
For 2025, The RealReal is projecting gross merchandise value of more than $5 billion, total revenue of more than $1.5 billion and adjusted EBITDA of more than $100 million.
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To get there, Wainwright plans to keep driving growth, grabbing a bigger share of what she sees as a gigantic addressable market, and keep tightening up expenses.
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There’s a way to go still.
Last year The RealReal’s revenues increased 55.9 percent to $467.7 million, while losses before interest, taxes, depreciation and amortization tallied $126.9 million. (Net losses widened to $236.1 million).
Speaking to investors at the company’s Phoenix authentication center, Wainwright said The RealReal started in 2010 with her thoughts about building a consumer business Amazon couldn’t replicate.
The a-ha moment came when she went to a boutique with a friend who gleefully snatched up high-end bags that were there under consignment.
As she built the business, there were plenty more revelations, including just how bad fashion is for the planet, how resale can help alleviate that pressure and the power of retail to amplify the company’s brand.
But Wainwright at the meeting leaned heavily on another key lesson from the company’s early days — and it’s one that might well define The RealReal’s future.
“What I didn’t know is the power of technology and how it would change our operations,” the CEO said.
Now she is looking at technology as a key differentiator.
“We have a phenomenal moat around our business,” Wainwright said. “A lot of it is data and technology.”
The Real Real uses data and machine learning and vision technology to help it identify the products it takes in, recognize fakes and sort them efficiently.
And what’s more, it has a decade of practice.
“No one else has a data set like this,” said Chris Brossman, vice president of machine learning and data, at the meeting.
In the last year alone it has built up a database of more than 80,000 items, with more than 1 million total images of luxury goods.
Brossman said competitors would struggle to replicate the companies’ vast store of data and expertise and that The RealReal submitted some of its technology for patents last week, widening the moat that much more.
Wainwright said competitors are going to be testing the company as it goes after more and more of the resale market, which is still being established, but is said to be a potentially $200 billion market in the U.S.
“It’s still a baby market,” she said. “I expect many people to try to come into this space. No one can replicate what we have…without spending five- or six-times [what The RealReal has spent]. We’re so ahead, we’re really the ones to beat and people know it.”
Asked about just what the company will need to hit its ambitious targets, calling for at least 30 percent revenue growth, Wainwright pointed to talent and “our ability to attract and retain great people — it’s really as simple as that.”
The RealReal team has the “Vision 2025” — now they just have to get there.
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