Playing to families, OfferUp takes on Craigslist with mobile marketplace

Craigslist and eBay (s EBAY) are really getting hit from all sides. Convinced that they can create better peer-to-peer marketplaces, startups like Grabio, Listia, Hipswap, ShopSavvy and more are lining up to beat the aging Internet giants at their own game.
And now Seattle-based OfferUp, expected to launch Wednesday, is the latest company to enter the increasingly crowded space. Despite the competition, the company’s founder and CEO Nick Huzar said he believes OfferUp can carve out a niche for itself with a mobile app targeting families that makes it dead-simple to buy and sell gently used goods in a secure way.
“We want to revolutionize e-commerce by not only making it as simple as taking a photo, but by making it a safe experience for the people using OfferUp,” he said.
Huzar said he came up with the idea after his wife told him their first child was on the way. “I immediately went into ‘dad mode,’ and had a roomful of stuff to sell,” he said. But he found that using first generation marketplaces took too long and raised safety and security concerns.
Average family has about $7k worth of unused stuff
Inspired to dig deeper, he said he learned that his family wasn’t the only one with roomfuls of unwanted stuff lying around. According to a 2011 study from research firm NPD, the average American family has about $7,000 worth of unused stuff.  A 2010 report from the Department of Energy found that one-quarter of families with a two-car garage can’t park in it because of all their belongings.
So, Huzar, who previously founded Konnects, a SaaS-model social media platform for traditional media companies, rallied a team of five, including his former CTO at Konnects, and started building OfferUp last year.
The mobile app lets users take photos of items they want to sell (from strollers and toys to clothing and furniture), include a price, brief description and their willingness to negotiate and then post the item to a variety of platforms. The app can list items on Craigslist, Facebook and Twitter (they’re looking to add Pinterest soon, Huzar said) but the transaction takes place on OfferUp.  Through the app, buyers can search for items in their area and can then see the items’ general location (although no finer than neighborhood level to protect sellers’ privacy). Right now, the app is only on iOS but Huzar said an Android version is in the works for later this year.
Security feature protects users’ identity
One of the app’s more interesting and unique features is its “TruYou” identity validation program. Through the program, both buyers and sellers provide information, such as their driver’s licenses, which OfferUp then cross-references against public records. Once the company verifies the identity of those documents, the user earns TruYou member status to give potential buyers or sellers added confidence in transacting with them. Another security feature is the ability to send private messages within the app so that buyers and sellers can remain anonymous until both parties are ready to share personal information (including email addresses).
The company said it doesn’t plan to charge for the TruYou program but will eventually allow users to make payments in-app and take a small cut of the transaction value. As it grows, OfferUp said it will explore other revenue options.
Huzar acknowledged that OfferUp isn’t alone in providing a Craigslist-like mobile marketplace, but argued that the company is different because of its focus on families, security and simplicity. Since the site is so young, it doesn’t have engagement or user numbers to share, but it said that a pilot program in the Seattle area earlier this year saw impressive organic growth.
Given the speed with which families with children can acquire and then outgrow stuff, I think the family angle is a smart one to take, especially when paired with the security features. But considering the number of different companies tackling the secondary market space, it will be interesting to see if it can cut through the crowd of recent competitors, as well as the old options. While Craigslist and eBay may be more cumbersome, they still have name recognition. (And, then there’s always the old-fashioned garage sale.)
Huzar said he’s been bootstrapping the company since last June but is about to close a round of funding that includes investors from the Seattle area and Silicon Valley.