Wallapop has positioned itself as one of the Spanish undertakings par excellence. With a valuation of 400 million euros in early 2017, slightly below its last records, the company has fully conquered the second hand market. By replacing classified ads and making second-hand buy-sells locally and with added user experience, Wallapop has always been on everyone’s lips.
However, their entire history has been very glamorous until they have encountered some questions. With several millionaire rounds behind them, for amounts that nobody has been able to define, this resource was the only one that generated movements in the accounts of the company. The question since they were born and began to grow has been the same: how does Wallapop monetize? If their users contact through the app, but the money of the transaction circulates outside the application, they did not see a penny at any time.
A first approximation was the sponsored ads: users who, paying a small amount of money, had the possibility to put their ads above the rest and make them more outstanding. Since its release a few months ago, less than 3% of these are pay. But they needed more, much more.
With these poor results to date, Wallapop releases Wallapay. Which, as its name indicates, works as an optional payment gateway to manage purchases within the application. In other words, instead of having to go with the money in hand when you are going to collect the product, the payment is made through the mobile with an associated card. A code system very similar to what BlaBlaCar has been using so far. Before summer, the objective of the platform will be to operate as intermediaries in the shipping of the products, eliminating any possible friction and adding a new revenue path.
The interesting thing of all this is that, through this payment model, Wallapop secures a small commission for the management. Wallapop’s own numbers say they will start earning revenue, which they expect to turn into profits throughout 2018. For transactions under 40 euros, the Spanish startup will take an average of 99 euro cents, 1.99 per transaction That do not exceed 80 and so on.
However, as with transactions carried out by PayPal on other platforms, there may be the possibility of canceling payments once the product has been delivered by the user. Games in bad condition that once used stopped working, last minute crashes … In this context, Wallapop is going to have to open a new front of attention to the user that was not his business before, because when money is at stake , everything changes.