Whatnot Raises $150M, Becomes a Unicorn - Livestream Shopping

Whatnot Secures $150 Million in Series C Funding

Whatnot, a livestreaming marketplace designed for collectors, has successfully completed a $150 million Series C funding round. This marks the platform’s third fundraising event within the year 2021 alone.

The recent investment establishes Whatnot’s valuation at $1.5 billion, officially designating it as a member of the rapidly expanding "unicorn" category.

Understanding the Whatnot Platform

The Whatnot application capitalizes on a growing trend observed on platforms such as Instagram within the United States – and already well-established in China – known as live shopping.

Verified sellers are able to initiate live video auctions for their merchandise at any given time. Purchases can range from known items to surprise offerings, exemplified by the “card break” format where users acquire portions of unopened collectible card boxes and witness the reveal live.

Investment Details

This funding round saw participation from existing investors a16z and Y Combinator’s Continuity Fund. Joining them was CapitalG, formerly known as Google Capital following the Google/Alphabet restructuring.

The company has also attracted several prominent individuals as angel investors, including Andre Iguodala (Golden State Warriors), Zion Williamson (New Orleans Pelicans), and Logan Paul (YouTube).

Initial reports regarding this funding round surfaced last week through The Information.

From Resale to Livestreaming

Whatnot initially functioned as a conventional resale platform, concentrating on the authentication of a single collectible type: Funko Pops.

As the pandemic led to widespread lockdowns, the company strategically shifted its focus to live shopping, experiencing substantial growth as a consequence.

Expanding Product Categories

The platform has rapidly broadened its scope beyond Funko Pops to encompass a diverse array of collectibles, including Pokémon cards, pins, vintage apparel, and sneakers.

According to Whatnot co-founder Grant Lafontaine, sports cards currently represent the largest category, followed by Pokémon and Funko Pops.

Whatnot prioritizes onboarding sellers who are well-regarded and trusted within their respective communities. All streamers undergo a vetting process before going live, minimizing the risk of fraudulent activity.

Key Insights from Lafontaine

• The company identifies “thousands” of potential categories for future expansion, with Non-Fungible Tokens (NFTs) being a current focus. Streamers will be able to showcase NFTs during livestreams, with interactive metadata displays.
• Currently, there are “a couple thousand active livestream sellers” utilizing the platform.
• The platform’s Gross Merchandise Volume (GMV) has increased 30-fold since the Series A funding round earlier this year. Whatnot retains an 8% commission on each transaction.
• A “pre-bidding” feature is being implemented, allowing users to place bids on desired items prior to a livestream event.
• A complete overhaul of both the iOS and Android applications is underway, aiming to enhance the user experience for both buyers and sellers. The update is expected to be released within the next few weeks.

Competitive Landscape

With a total of $225 million in funding raised, primarily within the last year, Whatnot is operating in an increasingly competitive market.

Rivals such as Popshop are also securing substantial funding, and Loupe, based in Miami, recently raised $12 million and is planning a physical retail location focused on live sports card sales.

Established tech giants are also entering the arena, with YouTube experimenting with live shopping and Amazon engaging influencers for live sessions. The livestream shopping space is one to watch closely.