The RealReal (REAL) The 38th Annual Roth Conference summary

Market overview and business model

• Operates in a luxury resale market with a total addressable market exceeding $200 billion, growing 2-3x faster than primary luxury sales due to strong demographic and secular tailwinds.

• Growth is primarily driven by unlocking supply, with 50% of new items selling within 30 days and an average order value above $600.

• High-value transactions are common, with buyers frequently purchasing items worth $20,000-$50,000, supported by robust authentication and trust.

Recent performance and growth drivers

• Gross merchandise value (GMV) grew 22% in Q4, with Q1 guidance at a midpoint of 21%, attributed to improved supply unlocking strategies.

• Enhanced sales team profile and compensation, targeted marketing investments, and new store openings have driven growth in both consignors and buyers.

• Sales reps, marketing, and stores form a three-legged approach to supply, with each channel optimized for efficiency and impact.

Sales force and productivity tools

• Employs about 400 luxury managers nationwide who build relationships and identify high-demand items directly from consignors.

• Productivity is boosted by AI-powered tools like Smart Sales for lead targeting and a piloted price estimation tool for consignors.

• Incentive structures and real-time trend monitoring allow rapid adjustment of supply to meet demand.