JT Ho:

Welcome to The Future Fountain, a podcast series dedicated to conversations about the tech ecosystem - brought to you by Orrick and NYU Future Labs. I’m your host JT Ho, a partner with Orrick, where I work with high growth tech companies and investors in the areas of corporate governance, securities law compliance, executive compensation and ESG.

I am really excited to be speaking with Andy Ruben. Andy is the founder and executive chairman of Trove, which is leading the resale revolution with scalable branded recommerce solutions that extend the life of millions of products, creating more inclusive, less wasteful business models. Andy, welcome to the podcast.

Andy Ruben:

Thank you for having me.

JT:

Andy, can you share with us a little about the career journey that brought you to Trove?

Andy:

Yeah. I spent most of my career in brands in retail, including Walmart, for over a decade. And some of the experiences I got to have at Walmart, including starting sustainability, where my eyes were open to a range of just the way the world works, including the amount of production that we have for the goods in our lives.

And the genesis for leaving Walmart and Starting Trove was really the need for a model that wouldn't, you know, where brands could grow but not dependent on direct connection to new production. And I realized that that would have to be figured out in tandem with brands that couldn't be figured out on a whiteboard or in a white paper. We had to go do it. So we started Trove ten years ago. About six years ago, we decided that the way in of toward our mission, which is getting more use out of every item we produce, was with brands. And we launched the first brand partner, Patagonia. And from that first brand partner launched doing branded, reselling towards buying back and reselling their own items.

There are now 150 brands with dedicated resale programs out in the world. So, it's been it's been fun so far, and there's a heck of a lot more to go get done.

JT:

Can you tell a little bit more about Trove's business model and specifically how sustainability factors into your business strategy?

Andy:

Yeah, absolutely. So just Trove, in terms of what we do, Trove powers. Some of the best brands out there, the resale so their ability to go find and take back the items they previously sold, take them back via mail, digitally, in stores, to process those items, release those items on their own websites or in their own stores and sell them a second, third, fourth time.

So true powers brands, like I mentioned, Patagonia, REI Nordstrom, Lululemon, Levi's, our whole list on running, Allbirds. Really premium brands who make things that have additional life in them. And so, in terms of sustainability, what that allows is it allows a model for these premium brands to make a portion of their revenue from existing items.

So, Patagonia makes revenue from selling that same jacket that they sold the first time, a second and third time. That means Patagonia is avoiding the production, the procurement, and the distribution of that jacket, and that is one of the most needed changes in our current model, is how brands have growth trajectories that, you know, how brands are able to grow without growing emissions. And that's largely production.

JT:

Why do you think brands are attracted to Trove? What is unique about Trove?

Andy:

We're the very first in the space to actually focus on brands. I think it's easy to say that now, but there's some elements that really still ring true. So, the reason brands do this in general: yes, sustainability, but also for core business, when brands are able to buy back their items from their most loyal customers, they drive additional store trips, they drive additional loyalty where they're able to sell those items to customers. They provide access to the brand at a price point that many people can't afford. I can now access Canada Goose. I might not be able to access it new, but this is my way into the brand. It's kind of like buying a pre-certified Lexus. And so what attracts brands to working with Trove is a set of capabilities where we really put the ownership of the brand in the brand's hands, and Trove is the back end provider with all the technology that's necessary for brands to scale this, make money doing it, and do it in brand. And that includes everything from when you walk into an Arc'teryx store, the technology that helps someone, you know, when you walk in with an Arc'teryx backpack, decide how to price and give you a gift card for that all the way to pathing, deciding where that items show up, how to price it, what condition it's in, and how to list it.

So, it's really that we are serving a need that brands have that just doesn't make sense for them to build themselves. It makes a lot of sense for them to use a partner like Trove.

JT:

What advice would you have for founders who are innovating within the retail and ecommerce industry?

Andy:

Yeah. I mean, this advice is, I think is especially timely right now given a market where a lot of people are keeping things kind of very few priorities, and they tend to be very core. That, as you know, first piece of advice on brands in retail is to really focus on big problems that are in the top list for brands, especially now, because brands have some big challenges with inventory and cost containment.

And I think there's less appetite for whole new revenue generation and a lot more concern around efficiency and costs. I don't think that's novel advice, but I think it's very timely advice. And Trove is no different than anyone else right now. We have repositioned how we approach brands to make sure that we're coming in with an offer that's going to save brands money, day one.

And it's great to talk about the future and how big it's going to be. And it's going to be huge. But the starting point for brands today is how they can make the current business work better. And that's going to give them the ability to continue to innovate and take on the bigger opportunities down the road.

JT:

What are the biggest challenges that you're facing right now?

Andy:

Probably the biggest challenge that we're dealing with is if you get to a stage where, you know, you start where you've got a few brand partners: for us, it was Patagonia, Eileen Fischer and REI. Our initial three brand partners. And you build something with them that's valuable, but then you start to expand that to dozens of brands, and there's a point that you've got to really scale something to be able to affect brands in many markets around the world.

At first we were doing, you know, end to end. And as we continue to scale, we look for where we really want to occupy. Where can we really add value? And how can we work with others so that we don't have to do the entire thing? We can really scale by working with others and doing the thing we're going to ultimately be able to do really well.

JT:

Are you optimistic about the way we are all reimagining how we shop for clothing and other consumer goods?

Andy:

Long-term optimistic, yes, but a big caveat on that: right now, talking to younger customers, especially Gen Z, makes me optimistic because of the approach and way of thinking about brands and sustainability as a kind of holistic concept. Where it's hard to be optimistic is when I look at the current model, and again, that current model is based on increasing production, and that model needs to change, and it's not easy to take a model that people make a lot of money on and works really well right now for a lot of people and see how that is exactly going to change.

So, I think the only question is what the path of that is going to be. The model ultimately doesn’t work and won't work over the next 20 years. The question is just how we get there. And I think it's really hard to know right now if that's going to be incremental change at an accelerating pace or they're going to be larger changes, like the disruption of many brands we like today, and, you know, we might not be able to innovate fast enough. So I think that's the only unknown. So no, I'm not optimistic right now about the current model, but I am optimistic that we will figure out ways of solving it, just like we have for past decades.

JT:

Well thank you Andy. This was an insightful discussion. And thank you to our listeners for joining us for The Future Fountain.

Andy:

Thank you for having me.