20 Things You Didn’t Know About Faire
Faire is an American company that has experienced rapid success in its growth and development and if you haven’t yet heard of it, you’re not alone. It’s a wholesale marketplace that assists mom and pop stores in growing their brands. It’s one of the best-kept secrets in the business world, but this is likely to change as the success of Faire has a lot of people talking about it. We were interested in learning more about this relatively obscure company that has risen in popularity within its specialty niche, and we made some fascinating discoveries that are well-worth sharing. If you’re a small to medium-sized business owner then you might find that Faire is a company that could be of assistance for you in your business endeavors. Here are 20 things that you probably didn’t know about Faire.
1. It was formerly called Indigo Fair
When Faire was founded it was first established under the business name Indigo Fair. Max Rhodes is a co-founder of the company and Max first got the idea to establish a go-to service for product makers and retailers. Indigo Fair started as a platform for connecting product makers and retailers to help artisans and others to get their products produced and marketed. The name changed from Indigo Fair simply to Faire in 2019.
2. Faire has become a phenomenon among artisans
Once the word got out about Faire’s unique platform the company has been inundated with applications and requests from artisans and those who make their own products. The Faire team can only accept roughly five percent of the applications that come in each week. Hundreds are coming in in a steady stream. The executives of the company hope to increase the percentage of applications accepted as Fair continues to expand and grow.
3. Faire is “social and curated”
Faire does a lot of networking and they curate an environment for retailers by choosing the best quality products to offer them to sell. Makers who have become a part of the Faire network have been vetted by the company to ensure that the products they offer meet with strict quality standards. Once this has been accomplished, the process is simple. They are linked with retailers and then the makers send information to the retailers and they print out a label and start shipping their products to the retailers, who will, in turn, sell them.
4. There are benefits for retailers who sign up with Faire
Retailers who sign up with Faire are granted access to unique items that may not be available anywhere else. While some of the products are fairly generic and easy to find elsewhere, many handcrafted items are one of a kind and this adds value. When retailers are interested in changing things up and offering their customers some new and unusual or novel products, Faire has a great selection to choose from. Retailers have immediate access to wholesale products from the makers.
5. Faire is convenient for retailers and makers
One of the best benefits of going through Faire for both retailers and makers is that they make it easier to market the products. Often, artisans and makers travel to trade shows and retailers do the same in search of new products. Faire compartmentalizes the process by signing with makers and advertising the available products in an online format, so there is no longer a need to spend budget dollars on attending costly trade shows. Retailers and makers can more conveniently connect through Faire. In essence, Faire streamlines the process of marketing between these two groups.
6. Faire empowers wholesale marketers
There are scores of marketers who have interesting and great products available for sale but marketing can be expensive. Faire empowers wholesale marketers by giving them a place to place the goods that they have for sale into the hands of the consumers. The platform saves a lot of money in marketing costs and this is just one of the reasons why the company has become so popular with makers and wholesalers.
7. Faire has taken to social media
Faire is leveraging the use of social media to get its message out to makers and wholesalers. The marketing camapaign includes using Facebook to spread messages out to those who are listed as being shop owners or product designers. This is an excellent form of marketing and it has reached millions with the message in a short time.
8. Faire recently received venture capital funding
In December of 2018, Faire received the boost that it needed to continue the development and expansion of the business operation. The amount raised was $100 million which was the largest infusion of capital that the company had managed to secure at that point in its development. This brought the total amount of funding to $116 million, thanks to previous fundraising ventures.
9. Faire is on a mission to reinvent wholesale methodologies
The purpose behind Faire, according to Max Rhodes, a principal founder is to change the way that the wholesale process occurs. There is a serious need to streamline the process for both retailers and makers. Previous models were clumsy, time-consuming, and costly. Faire’s platform addresses all three of these identified issues.
10. By December of 2018, Faire grew exponentially
As of December of 2018, Faire had established a network and community of 15,000 stores. These stores are retailers who have signed on to Faire’s platform to connect with makers and to purchase the products that they produce. 2,000 makers also subscribed to the networking service.
11. Investor interest in Faire has grown
After realizing the potential of Faire’s new and innovative business platform, venture capital companies became interested in making investments in teh startup. Sequoia Capital is one of them. The most recent round of funding brought in a round of funding that as of December of 2018, brought the valuation of Faire to $535 million. This was a pivotal time in the development of the business.
12. Faire does most of the work for its subscribers
The only thing that makers need to do is to provide product images, descriptions, and pricing. Faire staff does all the rest to ensure that the goods are represented for retailers to review and consider. The online application is simple to complete, but only a small percentage of applications are approved. Boutique buyers can browse through the products that are available in neat categories that make them easy to find.
13. Faire uses AI technology
Faire has entered the marketplace with the most up to date and advanced technology powering the platform. They use predictive software that features Faire’s own in-house AI-powered image recognition software. This is used on the home website as well as on Instagram. This technology draws from a database of hundreds of thousands of products to show retailers subsets that match the store with precision.This is a big timesaver for retailers in search of products. The system operates from a prediction algorithm that continues to get smarter with each new set of data included. It automatically generates lists of new items that are closely related to the type of products that the retailer has indicated an interest in.
14. Faire charges a commission
Faire makes its revenue from the makers who display their products on the site. For the first order, artisans pay a commission of 25% and the cost lowers to just 15% for the second and all of the other orders sold to the same shop. Brand owners may receive immediate payment for the orders placed. There is a bank transfer fee of three percent when this option is selected. This means that the total amount for selling comes to a whopping 28% commission unless the same retailer continues to order. It’s a high commission rate and this is one of the drawbacks for makers.
15. Faire hit a few snags along with the way
Although Faire has become a highly successful company in the marketing sector, the journey has been fraught with pitfalls. There were a few major issues in the operation initially. Just two years ago many of the products that Faire sold were returned. This was dwarfed by the even larger problem of retailers that had never paid Faire for its services. There was a time Rhodes explained, that Faire lost money on every order that it received and as the growth of the company continued, the losses increased.
16. Faire had to change the rules
There were a lot of holes that needed to be repaired. While Faire had a great concept that would be beneficial for makers and retailers, the company was taking big losses on most transactions. The new startup identified the problems then made changes in the marketplace to address the trouble. They ended up changing some of the marketplace rules and then set credit limits for retailers. There was also a re-ranking of makers and their products to make it more user-friendly for retailers when paying their invoices. The changes were successful and it helped Faire to establish sound business practices and to have more control over the billing and collections part of the company. The changes were so effective that defaults for payments decreased by nearly 90 percent and return rates lowered by 75 percent.
17. 2019 brought Faire to unicorn status
By the end of 2018, Faire had more than halfway reached the elite unicorn status. This is the term when a company reaches the billion-dollar valuation mark. Within just two years of commencing operations, Faire had joined the upper echelon with more than one billion dollars in valuation.
18. Faire’s statistics are impressive
CEO and co-founder Max Rhodes shared some interesting statistics about the company. Faire has undergone yet another growth spurt. As of late in 2019, the business had facilitated the sale of approximately fifteen million products. The daily sales average is a million dollars and this is an increase from the previous 2018 figures of a million a month. That’s about an increase of thirty-fold. Currently, there are 7,000 brands represented to 50,000 stores and it seems that Faire is expanding monthly.
19. Faire is a privately held business
Faire is a company that would no doubt make an excellent stock to invest in, but the company has not chosen to go the route of public trading. There has not yet been a discussion or news release about going public just yet. Most companies file for an IPO when there is a serious need to raise funds. Faire hasn’t had any problem raising capital and there are plenty of venture companies interested in continuing to invest in them as needed. There is no reason for them to take the risk of decreasing the valuation of the company as this can easily happen when a company goes public. For now, and the foreseeable future, Faire is a privately owned company and this isn’t likely to change anytime soon.
20. Faire has opened its doors to Canada
We learned that Faire has expanded its services to include Canadian retailers. One of the founding members is a native of Canada. This gives Faire the status of an international operation, although Canada is a part of the North American continent. The headquarters is based in San Francisco, California, but an office has also opened in Ontario, Canada to help manage the business to Canadian retailers. Faire is on the move and it is continuing to grow at a rapid pace. It has only been in existence since 2016 and has only been profitable for less than two years, but it’s reached unicorn status already. Now that Faire has opened up to Canada, there are high expectations for another huge surge in growth and expansion.
