The Online Watch Market – Claudio de Giovanni from Verado
Deciphering the world of online watch marketplaces.
After a look at Chrono24, Montredo and WatchBox, we continue our series focusing on understanding the online watch market – certainly one of the most important trends in the watch world today. Today, we’re talking to a newbie in the world of online watch marketplaces. The name of the company is Verado and its Founder & CEO is Claudio de Giovanni. What makes Verado unique? It claims to be “the facilitator of fair transactions between real people” – something that will be explained in the following interview.
Can you give us a quick history of Verado?
As is often the case with great ideas, Verado was borne out of a bad personal experience: I was trying to buy a Chopard necklace for my girlfriend — second-hand — but couldn’t see consistency on pricing or get any transparency into quality. And there was no indication of how an item’s authenticity was being verified. The same was true when buying a Rolex watch for myself. I was in the dark. I could have easily parted with thousands of pounds, not knowing what I was buying, from who, or whether I was getting a good deal.
I quickly found that this experience was commonplace. There was too much space in the secondary luxury market for potential fraud and pricing bias. This needed to change. At the same time, a direct access point to authenticity and unquestionable quality was needed. These are things people want — expect, in fact — when investing so much income into something.
I come from a background in tech and online marketplaces, so the answer was very clear to me: use technology to provide an absolute view of the market, formulate the most accurate listing prices for items, and verify every single one with only the best manufacturer-certified inspectors and online verification processes.
Verado started out in 2016 — at that time under the name Watchr — and with the backing of some amazing investors and an incredible, talented team, we’re now growing faster than ever before.
What brought you to Verado?
The basics are that I just love fixing things — and there’s so much that needs fixing in the secondary luxury goods market. The fact that this market is already so huge, and will keep growing as it becomes digitised, means that it’s an incredibly meaningful area to be involved in. I wanted to lead the change that was needed.
My experience in tech, prior to Verado, gave me the ability to design and develop our model to be as competitive as it is now. Building and scaling online platforms fascinates me, and I’ve worked with companies like Rocket Internet and YCombinator, which put me on the front line of nurturing disruptive businesses from scratch.
Who is behind Verado? (investors and management team)
Our management team is made up of myself (Founder & CEO), Mirko de Giovanni (Operations) and Joe Hill (Engineering). In total, we’re a team of seven. We’ve secured GBP 300,000 in Angel Investments so far, and we’re backed by investors including Chris Fung (ex-CEO of Crussh Foods), Vishal Mehta (Director of White Hope Holdings and Dimexon.com), Petrone Group and a prominent enterprise in the diamond industry.
What is your business model?
It’s great that you asked this because we want people to know exactly where their money is going — we have to be absolutely transparent to be the market leader. Our selling commission is calculated using a variety of factors to do with an item’s characteristics and quality. This works out at between 0% and 5% of the final purchase price.
On the buying side, we charge up to 10% of the final purchase price to cover the cost of professionally authenticating each purchase. Sellers can still make up to 20% more when using Verado instead of selling to a dealer, so our model is working.
What differentiates Verado? What do you bring to your clients?
The key differentiator of our position in the secondary market is that we’re not a merchant, an eCommerce site or a dealer — we’re the facilitator of fair transactions between real people. Our model blends specialist industry knowledge with best-in-class technology to provide stronger guarantees of quality, authenticity and value. Our promise to our customers is that whether they’re seeking or selling luxury, we’ll protect them throughout the transaction.
What are your key challenges?
Building trust is a journey, and it’s essential to what we do. When we develop anything new on the platform or improve what’s there, it really is at the heart of our decision-making process.
The second challenge is getting quality supply. We’ve got systems in place that help us do this, but as a company that’s founded on the concept of guarantees, it demands our non-stop dedication.
Finally is hiring. We’re a tech business at our heart, so we need people who are passionate and talented in that area, but we also need people who understand and care about the customers we serve and the items they’re trading. It’s a very exclusive mix, but we can’t afford to not invest in this level of expertise.
What are your plans for the next three years?
Our main aim is to establish universal brand awareness of Verado as the UK leader in second-hand luxury products. We’re also looking to expand into Europe, Hong Kong and Dubai.
What are the key trends and perspective for the watch market?
The most important thing for me is that buyers feel comfortable purchasing second-hand luxury products. People want to see more quantified evidence to back up their trust.
Secondly, the primary market is shrinking whilst the secondary market gradually increases in value — consider that all new stock that enters the market immediately becomes pre-owned and has the potential to change hands many times.
Thirdly, big brands are now looking to monetise the secondary market. Case in point: the acquisition of Watchfinder by Richemont. This will only lead to further growth.
How do you analyse the market?
Our proprietary technology uses an algorithm to track hundreds of thousands of data points from across the web on past and current pricing trends. By cross-referencing these with our own internal database of historical transactions, we get a deep view of the market. This then allows us to formulate the most competitive listing price for all items. It’s at the same time fair for buyers and lucrative for sellers.
The potential of the secondary market is huge. Up until now, brands had not been doing a great deal about the secondary market but are beginning to want a piece of the action. How do you envision working with them?
Well, this is a huge opportunity. Firstly, we want to create a global platform that can provide efficiency, certainty and safety within these secondary transactions. Eventually, we’ll become a platform that uses blockchain to create a digital ledger of every single movement made by an item, from buyer to seller, back to another buyer and so on.
For brands, our data has huge value. Right now, they’ve got little visibility into the secondary transactions that are taking place, because they don’t control them. There’s exciting potential for us to form relationships with these brands in the future, giving them a slice of the pie they’re missing out on currently.
What is your main advice for collectors?
Don’t be afraid of buying and selling online — this is an amazing opportunity for you! With Verado, you get the best price, more supply to choose from, multi-layered product authentication (as a result of technology being used alongside actual inspectors) and the peace of mind that you can return items with no questions asked. It’s equal parts secure, lucrative and gratifying.
People may think that offline transactions are more secure, or somehow that in-store service is of a better quality, but you can see from our reviews that the collectors who do take the jump to digital and use Verado are always satisfied. I think it comes as a surprise for many, to begin with, but they’ll likely never go back to using a high street dealer again.
What will be your next personal watch acquisition?
The Patek Philippe Nautilus. These are in limited supply and highly sought after. The design is fascinating but unpretentious, and I love the sapphire crystal caseback that lets you see the movement — it’s very much on par with Verado’s transparency obsession.
Thanks for the article!