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Yerdle: Competing With Amazon And eBay With The Price Tag Of $0

Feb 12 2014, 6:15am CST | by

Yerdle: Competing With Amazon And eBay With The Price Tag Of $0
 
 

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Yerdle: Competing With Amazon And eBay With The Price Tag Of $0

If you’re like most people, you’ve got a lot junk you don’t use piling up in your garage. And San Francisco-based startup Yerdle wants to help you get rid of it.

Yerdle is today launching its marketplace of free stuff that people don’t want nationwide. Using a credit system, Yerdle’s marketplace allows users to bid on or “buy” bread makers, bikes and electronic gadgets that people have long forgotten. Credits are acquired by sharing your own stuff on the marketplace. New users start out with 250 free credits. (With 250 credits, the most expensive thing I could find was a Linksys Wireless Router.)

The national launch includes shipping anywhere in the country for $2-$4 as well as an update to the app–which includes a curated front page of interesting stuff for sale and an “add to shopping cart” and “checkout” buttons that are meant to replicate internet shopping experiences.

Founded by a former Walmart executive and an environmentalist, Yerdle has been working on its marketplace for a little more than a year now just in San Francisco and has gotten nearly 30,000 users signed up since its launch on Black Friday 2012. The company has learned along the way that getting the marketplace experience to be more like buying anything else on the internet works best. Its credit system, for example, didn’t start until October of last year and that’s when members started using Yerdle more.

“When we launched credits, we saw a huge spike in activity,” Adam Werbach, cofounder and head of product at Yerdle, says. ”People could understand all of a sudden the social and emotional components of the exchange. … It needs to approximate shopping.”

Will this kind of marketplace work outside of Silicon Valley’s cloistered “shared economy” mentality? Werbach is pretty sure that his company’s model appeals to underlying behaviors found in everybody. Informal sharing is a normal part of daily life for most people; Yerdle is just bringing it into the world of internet shopping.

Other so-called “shared economy” startups like Uber (car sharing) and Airbnb (house sharing) have been getting a lot of traction in the past year. Google Ventures invested $258 million in Uber last summer and Airbnb’s valuation numbers have been spinning into the $2 billion region.

An advantage Yerdle may have over Uber and Airbnb is that it’s unlikely to get locked up in same kind of regulatory battles that they have been facing. A disadvantage for Yerdle is the lack of a clear business model. Werbach says eventually the company will start selling its credits for cash instead of requiring users to slowly acquire them through the sharing of their personal belongings. But giving Yerdle members the ability to simply buy credits would seem to put at risk its mission of a marketplace of free stuff–if it’s cheaper than ordering from Amazon, why not just buy enough credits for that DVD set of the Wire you found on Yerdle?

Ultimately, Werbach says, ”the mission is to reduce the acquisition of new things by 25 percent. We’re doing that by building a new kind of internet retail. You basically currently have two—eBay and Amazon. We think we have the capacity to be the third. The big thing to win at is price, and you can’t beat free as a price. You can buy that Lego set or get it for free on Yerdle.”

Of course, it’s unlikely you’ll want to trade in your Amazon Prime membership for Yerdle anytime soon. Yerdle currently has nowhere near the selection of goods that Amazon or eBay has and likely won’t for a long time.

Source: Forbes

 

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<a href="/latest_stories/all/all/31" rel="author">Forbes</a>
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