The furniture industry is by all accounts an environmental disaster. It consumes massive amounts of natural resources to produce, most especially wood, where it is the third-largest user after construction and paper. In addition to natural resources, the furniture industry uses a boatload of plastics, resins and potentially harmful chemicals in production.
It also throws off considerable CO2 from manufacturing and shipping. For example, the Furniture Industry Research Association (FIRA) found the carbon footprint for a typical sofa was 90 kilograms, or the amount a Boeing 737 or 747 produces in an hour of flying.
Then there is the waste it produces. Besides manufacturing waste, cast-off furniture is a big contributor to municipal waste management systems. According to the latest EPA estimates, some 12 million tons of furniture waste was produced in 2018 with the lion’s share going into landfills and almost none recycled.
Unlike other consumable products, such as clothing which can slip into a closet or drawer barely noticed, buying a new piece of furniture usually entails getting rid of an old one.
Back in 2018, when 12 million tons of furniture waste was produced, Americans spent some $128 billion buying new furniture. In 2021 they spent $180 billion, a 40% increase. If furniture waste was bad back then, it is worse today.
Given these factors, especially the furniture buying boom over the last year, there is a great circular market opportunity in used furniture, estimated to total $16.6 billion by 2025. But its potential is hampered by problems moving furniture from one home to another. The fashion resale market, estimated to reach $47 billion by 2025, has no such shipping constraints.
To date, the secondhand furniture market has been limited to local thrift shops and mostly local transactions facilitated by online sites like Craigslist and Facebook Marketplace. Other players, like Chairish and 1stDibs, have focused on the luxury, designer end of the market.
E-commerce Kaiyo bridges the gap, offering popular brands, like West Elm, CB2, Ethan Allen, Crate & Barrel, RH, Design Within Reach, Room & Board, Drexel Heritage, Herman Miller and more, with white-glove pickup and delivery efficiency.
Online furniture swap meet
What started as a furniture rental service in 2014 was relaunched in 2019 as an online furniture resale company after founder Alpay Koralturk saw the writing on the wall. He came at it from the finance side, having worked as a trading analyst with J.P. Morgan and on the finance team at Martha Stewart Omnimedia and Moda Operandi.
“It all started from a personal need,” Koralturk shared with me. “After my wife and I got married, we were set to buy secondhand pieces to furnish our home because we care deeply about sustainability and the environment. Living in New York City, we thought it would be easy to score some great secondhand furniture. What I figured would be a piece of cake turned into a difficult, frustrating experience. We ended up buying everything new.”
His personal experience engaged his entrepreneurial spirit and he found a great untapped opportunity inspired by the used car market.
“Cars and furniture are very comparable products. After homes, they’re the number two and number three biggest purchases people make,” he continues. “They are highly depreciating assets and they both have comparable lifetimes. But the used car industry is huge because of the number of times people keep transacting the same car. Yet only a tiny fraction of furniture is resold. And it’s a category where people actually pay to trash unwanted items. It’s a bizarre imbalance.”
Recognizing the possibilities, Koralturk knew there was a ready market for gently-used furniture, particularly among urban nomads who pick up sticks and move year after year. The market potential was further enhanced by the greatly reduced prices for used compared to new furniture and the sustainability angle.
Solving for logistics
But first, he had to work out the logistics so that people could tap some of the equity in their used furniture and move unwanted furniture out of the home easily. That was solved by giving sellers a free pickup service scheduled at their convenience after registering on the site and sending pictures.
Upon acceptance, the Kaiyo pickup crew arrives as scheduled and makes a final on-site inspection. They then make an instant offer for the furniture piece. If the seller accepts, the deal is done or the seller can wait until a sale is made and split the revenues based on the final sale price.
“The goal was to make it as simple a no-brainer as possible so people don’t have to resort to throwing out their piece or begging friends and family to take it away,” he says.
Once Kaiyo takes possession of a piece, it is professionally cleaned, then photographed with the same care given to new furniture and posted on the Kaiyo site.
Upon purchase, the furniture is delivered at speed, within two to three days versus the many weeks or even months required for new furniture. A modest delivery fee between $19 and $39 is charged for white-glove in-home delivery.
More to come
Currently, Kaiyo offers delivery in the greater New York, Philadelphia, Baltimore and Washington, DC metropolitan areas, but with a new round of $36 million Series B funding, led by Edison Partners, it will be expanding service in Los Angeles in a couple of months, followed by San Francisco and other areas of California.
“This is the next chapter in our evolution. It will help us take our great service to more and more people and realize our vision of making beautiful homes accessible and convenient for everyone. And it will help save our planet,” he says, adding that the company has made it a practice of planting one tree for every order made. But in celebration of this Earth Month, capped by Earth Day on April 22, they will be planting two trees.
“We want more people to participate in the circular furniture economy and we are opening a new category in the market that everyone can participate in,” Koralturk concludes.