I first met Manish Chandra, Poshmark Co-founder and CEO, in 2004. We were both charter members of The Indus Entrepreneurs (TIE), a pioneering community organization for Indian-American technology entrepreneurs. We hit it off, as we were both technologists who were fascinated by business and wanted to create industry-defining companies. Our interaction grew through sounding board conversations about Manish’s first start-up, social shopping discovery service Kaboodle (aka Pinterest of 2004), and deepened into a company building collaboration in 2010, the year before he founded Poshmark.
In 2010, Manish had identified that the iPhone and Instagram would serve as consumer behavior accelerators for mobile and social commerce. Fashion was a multi-trillion dollar industry that had not leveraged technology and the sharing economy was becoming a mainstream phenomenon. We met for breakfast at Hobees in Cupertino, as part of our ongoing brainstorming, where I remember the moment, 6 months before founding Poshmark, when Manish told me that he was going to give up his laptop and just work on his iPhone.
Mayfield’s founding investment in Lyft, and some of my other investments in consumer and marketplace breakout companies such as Makemytrip.com and Matrimony.com in India had equipped me with a playbook of success.
Together, we realized that we could build a unique partnership as founder and founding investor. One of the hallmarks of Manish is his high degree of self awareness and EQ. He realized that in aiming to serve a fashion consumer, primarily women, he needed to complement his technical co-founders – Gautam and Chetan – with a fashion industry expert and business leader. We introduced him to Tracy Sun, who turned out to be a great fit, and the founding team was complete. We led their Series A in February 2011, their stealth name GoshPosh evolved into Poshmark, and the industry’s first mobile-enabled social marketplace was created.
Taken from Poshmark’s (then GoshPosh’s) original Series A fundraising deck.
We have participated in every single round of their financing since the founding through our early-stage funds as well as our growth-stage Select funds, and Poshmark’s IPO today marks the latest milestone in our decade long journey together. Here are some lessons learned along the way.
Founding investors need to be just as bold as founders
Partnering with an entrepreneur at the idea stage when there is no product, an incomplete team, and no customers is not for the faint of heart. Founding investors realize that overnight successes take a long time and need to be guided by core beliefs that enable them to stay the course. Some key ones that drove our successful partnership with Manish and the team include:
- Embrace the unconventional, the different, the unusual: As a former engineer and proven entrepreneur and technology executive, Manish was definitely an unusual founder to start a women-focused social marketplace.
- Be loyal to a fault: The Poshmark journey had its share of challenges. Raising rounds of venture financing from the primarily male investor community was not always easy, and I recall how we persuaded one of our limited partners to lead a small $2 million investment during a tough phase. One of Poshmark’s innovations was around providing frictionless postage which got them into conflict with the USPS and we supported them. They have always maintained the balance between growth and profitability which was not easy. Manish has discussed a juncture in which they paused growth (generally not a popular move with investors) to build out the platform, but we realized that it was the right move for the company at that time.
- All of us are better than any one of us: We believe in providing mentor capital and access to our networks, not just venture capital to entrepreneurs. One great example of this during the Poshmark journey was connecting Manish to the right talent partner during his independent board member search which resulted in Serena Williams and Jenny Ming joining the board.
Tales from Poshmark illustrate five rules of the road
Over my career as a VC, there are five rules of the road that I believe are critical to company building, which I shared with entrepreneurs at Stanford’s ETL Series. The tales of Poshmark richly illustrate these learnings:
1. Mission and values are critical. Their founding mission to put people at the heart of commerce, enabling everyone to thrive and their values, especially that of leading with love, were built into their culture and DNA;
2. Their singular focus on style (starting with resale and expanding to retail) enabled them to buck the trend of startups who die of indigestion, not starvation;
3. Their ability to deliver sellers an integrated, frictionless platform and buyers a vast, curated marketplace anchored on rich social interaction, made their offering a painkiller, not a vitamin;
4. They innovated across the value chain by building an asset-light, two-sided marketplace that charged one price for bundled services including logistics which enabled selling as a superpower;
5. Their focus on people in the community and within the company has been foundational and enduring.
The team’s commitment to community is aptly expressed in Manish’s letter in the S1; a couple of excerpts below:
“Of course we had high hopes for the business, but we never imagined the kind of impact that Poshmark would have on millions of people’s lives. Every day, we hear from Poshers who proudly share their stories. I think of Kristin and Korinne, a single mother and her daughter who combined their selling forces to make enough money to send Korinne to the college of her dreams. Alex, who was diagnosed with a rare autoimmune disorder and started selling on Poshmark to pay off her medical bills. Tina, a domestic violence survivor who sold clothes from her closet to provide her enough financial independence and confidence to leave her difficult circumstances. And Danee, who no longer has to worry about paying for essentials like groceries and more thanks to her Poshmark business.
It is an honor and privilege to empower the millions of people who make Poshmark what it is—a community that embraces individuality, provides support, fuels circularity, and encourages dream chasing. What makes Poshmark so special is that people can pursue their own ambitions and define their own success. The result is a dynamic market, alive with the energy of people coming together. Something truly magical.”
Today’s IPO marks the latest milestone in our journey and the realization of the Poshmark founders’ vision to transform the way style is sold with the power of mobile and social. It’s been an honor to work with Manish, Tracy, Gautam, Chetan and the entire Poshmark team as they built the company and grew their community of seller stylists, empowering everyone to earn money from the unused items in their closets. Today, the promise of Poshmark’s social and sustainable commerce is even more impactful as we all seek genuine social connection in a digital-first world.
As a conscious VC, I am excited to continue onwards and upwards to serving our community and making the world a better place!