Peer-to-peer resale platform Vinted is an outlier in the industry: it’s profitable and still growing — reporting a 330% jump in net profits to €76.7 million in 2024. To capitalize on that position, it’s introducing payments through Vinted Pay.
The company is building an in-house wallet and payout service for its members, in what it says is a bid to “create a more seamless, secure and user-friendly way to make payments through the app”, to replace the third-party wallets and payout services it’s relied on in the past. It’s a move that will also cut costs for Vinted, as the more of the payment process it handles, the less fees it has to pay to third-party payment providers. It’s currently testing an in-house wallet service with a small group of members in Lithuania, Finland, Greece, Slovakia and Croatia, a spokesperson confirmed.
While resale is an operationally heavy, low-margin business, payments is a high-margin, high-volume and infinitely scalable business that has borne some of the most valuable startups in the world, including Stripe, Block and Adyen. Typical gross margins for payment companies range from 60% to 90%, while resale platforms’ gross margins hover up to 30%.
“By developing our own, in-house capabilities and services, we aim to be faster and more responsive as we grow,” the spokesperson added, underlining that the Vinted Pay business is in its “early stages”, and that the company will continue to work with its existing payment service providers (PSPs), including Mangopay, Checkout.com and Adyen, across its 26 markets.
In a panel conversation at the Web Summit conference in Lisbon, Vinted senior brand director Andrew Smith told me that where margins are “razor thin” in the secondhand business, systematically moving into other categories beyond fashion has been part of the company’s vision from the get-go.
“It’s really all about achieving economies of scale through size and establishing network effects by having a large group of buyers and sellers,” Smith said. “We really do believe that the only way we can make secondhand first choice worldwide is by being a very large and dominant player.”
It comes as Vinted is gearing up to debut in the US. This week, it launched the first phase of an expansion into the market, testing customer appetite with a cross-border connection between buyers and sellers in London and New York. Resale is a seller’s market, and Vinted’s success is often attributed to the fact it foregoes seller fees — a tactic that both Ebay in the UK and Depop in the US have followed this summer, in a bid to acquire more customers.
Speaking on the panel, Smith said that Vinted understands its customers are economically motivated, first and foremost.
“Our community is primarily looking for economic value, and that’s what’s really driving their decisions,” Smith said, pointing out that the lack of fees results in more sellers on the platform, and therefore a much larger selection and better deals for buyers.
This is particularly relevant for aspirational consumers looking to purchase luxury items at a fraction of their retail price. While younger Gen Z and millennial consumers are leading the way on secondhand apparel shopping, this economic motivation spreads to higher ends of the market, too. In 2023, 47% of consumers earning an annual salary of over $100,000 purchased secondhand items, which is above the 43% average across income groups.
Vinted gained a foothold in the higher end of the fashion landscape when it acquired luxury resale platform Rebelle in 2022, which it followed up with the launch of a luxury fashion verification service in 2023. This year, it doubled down on the segment, launching an online wardrobe experience featuring brands such as The Row, Gucci and Prada, as well as a luxury fashion pop-up in London, House of Vinted.
“These two things together create a huge economic incentive for people to use the platform,” Smith added. “If you had to prioritize what motivates people, it’s economics; but what keeps people engaged and generates love for what they’re doing, is the feel-good factor of buying and selling secondhand. The truth is that our sustainable impact is a byproduct of the utilization of our platform.”
The resale to payments pipeline
Beyond its lack of seller fees, Vinted’s diversified revenue streams help it to stand out among competitors. In 2022, Vinted launched its logistics business subsidiary Vinted Go, to build its own low-cost shipping network for Vinted members in France and the Benelux region, expanding into Spain and Portugal this year. It’s also entering new categories like electronics, responding to customer demand. It makes sense, then, that Vinted wants to begin monetizing another core part of its platform infrastructure — payments.
Vinted is currently expanding its team of engineers and compliance experts to build out Vinted Pay in Europe. “Our goal is to build a global, revenue-generating, multi-service financial platform — essentially, creating Europe’s biggest fintech,” a job posting from the company reads.
As Smith highlighted, Vinted’s growth has been thanks to the flywheel created by attracting more sellers through lucrative conditions, thus increasing supply for buyers. Put simply, the hallmark of success for resale platforms is paying their sellers reliably and fast. It makes sense, then, for Vinted Pay to focus on improving seller payouts by bringing them in-house first.
At the same time, by building a proprietary wallet service, Vinted’s sellers will be able to store their earnings on the platform, use their balance to shop (which reduces the payment processing fees Vinted has to pay to third-party PSPs on each transaction), and it could also give sellers the ability to withdraw funds at a later date. All of these Vinted wallet features will close the loop between buyers and sellers by effectively recycling the money that flows through the platform, keeping it within the Vinted ecosystem. It also means that Vinted gets to keep a bigger proportion of revenue from each sale, as internal wallets cut down on the need to pay fees to process full payments through external third-party providers.
Building seller trust by minimizing fees has been a core part of Vinted’s strategy that’s helped accelerate its growth beyond those of competitors. By investing further in the seller side of the payment stack, experts say Vinted is doubling down on this competitive advantage by increasing its potential market even further.
“Vinted’s move with Vinted Pay reflects a broader reality across software platforms: owning the money layer is becoming a competitive necessity,” says Branden Jenkins, CEO of revenue management software business Maxio, who draws parallels with Spotify’s decision to process its payments in-house, too. “When companies bring payments and revenue operations closer to the core product, they unlock new pricing models, better customer experiences and healthier unit economics.”
