This Platform Uses AI to Guarantee Resale Value Before Consumers Ever Buy a Product

Resale can be a tricky game for consumers trying to clear out their closets quickly. Cue Croissant. No, not the pastry—the platform.

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The company, which officially launched its app Tuesday, uses artificial intelligence to facilitate a smoother resale process for consumers—and it starts before they ever click “Purchase” on an item.

John Howard, the company’s CEO and co-founder, said the inspiration for the company came from an interest in helping consumers find value in what they already have.

“A lot of the innovation taking place in e-commerce is about, how do we give people more debt, more easily? Buy now, pay later [is] the ultimate manifestation of that, and I just couldn’t get my head around why more work wasn’t being done on the asset side of the customer’s balance sheet. So [instead of] just giving people debt, how about we help people think about their stuff as genuine value, retaining assets that they have,” he said.

Croissant has more than 100 partnerships with brands and retailers like Anthropologie , REI , Patagonia , Bloomingdale’s , Nike , Lululemon and Free People . To use the AI-powered software, users download a browser plug-in, which works both on desktop and on mobile.

During their online shopping experiences, users with the Croissant extension see “Guaranteed Resale” prices popping up on their screen. That price represents the value Croissant’s algorithms believe the item will have on the resale market.

If a consumer does, ultimately, purchase the item, it gets added into their Croissant closet, which helps users track the value of assets they’ve purchased from eligible brands. If a consumer later decides they no longer want or need an item in their Croissant closet, they can sell it directly to Croissant at the Guaranteed Resale price, so long as the item remains in good condition.

Croissant then allows the user to send the item to one of its two facilities—one which it operates, and a second operated by a third-party logistics partner—for manual inspection. Once the warehouse receives and inspects the item, the consumer receives an immediate payout for it.

From there, Croissant’s team or its third-party partner lists the item en masse on a variety of resale sites— Poshmark , Mercari and more—until the company finds a buyer. Howard said, on average, it takes 30 days for a product to sell.

“We’re not creating listings one by one, like you or I would if we were trying to sell something on [a resale platform]. We’ve got a whole system where we can import a CSV file of all the items that we have available for resale and have those populate automatically. In essence, what we’re doing is helping give an economy of scale for the average seller,” he said.

He also noted that consumers retain nearly the full value of what Croissant would sell the item for. To determine the value Croissant will offer on its Guaranteed Buyback, the company uses AI-powered technology it developed in house.

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It leverages third-party data, like observed transactions on existing secondhand sites, list prices for items on resale sites, material used to make the garment and more to determine what an item is likely to sell for.

Over 26,000 people have used the platform—with the company expected that number to increase by 10 times in the next few months. With that in mind, Howard said Croissant’s next big step will be to start using its own data to train the model, in addition to the third-party information.

“We’re starting to see real momentum with people buying and selling in our ecosystem; we are not just reliant on third-party data anymore, but we’re actually able to start feeding in our own observed data. Where did things sell for when we bought it back from people who went on to sell it? What was the actual achieved price? And what can we learn from that data?” he said. “I think there’s an opportunity to make it even more robust and dynamic, and largely that’ll be based on using our own data as we continue to scale.”

Croissant earns its keep based on commissions from the retailers and brands it’s partnered with.

Howard said brands have shown excitement about the product because it has helped to increase their average order values (AOVs) by, on average, 45 percent. In an e-commerce environment where order size and loyalty are key, Croissant may be helping to attract consumers.

“[Brands and retailers] are willing to share some of those economic backdrops in the form of, basically, a commission or transaction fee. That’s our high-margin revenue stream that we’re really playing for, while the resale side of things, economically for us, is really just a break-even supporting operation for the business,” he explained.

Howard said, at the moment, Croissant doesn’t charge brands an onboarding fee.

In the future, Howard sees the Guaranteed Buyback tool helping to decrease return rates and bring in repeat customers. That’s because the company has plans to partner with one of the brands on the platform—though Howard declined to disclose the other company—to give consumers gift cards in return for their resale items. He also said the platform can get creative to help brands and retailers meet their resale goals, even if it’s a capability the company hasn’t historically offered.

For Howard and his team of 26 full-time employees, the major goal for the next few months remains to onboard as many brands as possible.

“There’s no retailer out there that is not in need of either more upfront revenue, greater re-engagement from their past purchasers or reduced returns,” he said. “[We want to] get that message out there, and get every retailer signed up in one capacity or another for Guaranteed Buyback.”

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