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StockX CEO on NFT opportunities, potential IPO plans

The CEO of StockX, Scott Cutler, joins Yahoo Finance to discuss StockX's expansion into Melbourne, Australia, NFT space, and the collectibles market.

Video transcript

JULIE HYMAN: The collectable economy has really taken off in our post-pandemic world and during the pandemic as well, of course. Let's talk to someone now who was in early on in that game, particularly in sneakers, but has expanded way beyond that. That is Scott Cutler, the CEO of StockX. And I know you just did an expansion into Australia.

But I want to talk about a different kind of expansion first, Scott, if I may, and just jump right into it with cards, which have been such a hot area. I believe that's an area you guys have gotten into on StockX as well. Where are you seeing the demand right now? Are you seeing it for cards? Is it hottest for sneakers? What does the flow look like on StockX at the moment?

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SCOTT CUTLER: StockX is a platform that represents well what's happening with millennial and Gen Z consumers. And it's not only about the highly coveted limited release items and now of multiple categories, but it's also the idea that many of these items could trade like assets, this view that there are other alternative asset classes. For us, that has always included sneakers. And now, as we've launched into other areas, for example, in collectibles, in electronics, trading cards in our collectibles category, again, represents this convergence of high demand consumer products, but also products that have real investment value for this generation of consumers.

BRIAN SOZZI: Scott, Macy's and Walmart earnings out this morning, both calling attention to a comeback in apparel sales, a comeback in personal care products. How fast is your business growing right now?

SCOTT CUTLER: We're coming off of a quarter where we're seeing just record growth off of a year of record growth. We saw during the pandemic and explosion of the business both new buyers, new sellers around the world. Our business is driven by a couple of factors. One, the growth of our business internationally and the growth of our business in other product categories. And so we have been one of the fastest growing consumer e-commerce companies anywhere in the world, but it's largely driven by this focus on a global customer and expansion into other categories.

I think what's happening in other e-commerce companies now is they're experiencing the lap effect of last year. We saw tremendous growth last year, but we continued that growth because we built a real solid foundation of new buyers and sellers over the course of the last year.

MYLES UDLAND: Scott, I want to ask you about-- like, let's call them the tried and true collectible market that you guys are a part of. And something that interests me, in addition to sneakers, is also watches. The prices on watches have been bananas, to say the least, in the secondary market here. How do you see, like, an established category-- wine, watches-- are playing out when you've got, you know, whatever's happening in NFTs coming up? Certainly, you know, what you guys have seen in your Supreme line has been quite interesting over the last couple of years as well. Like, how do you see the established categories fitting in with what I think some in collectibles see as a new paradigm? Or maybe it is just a passing phase.

SCOTT CUTLER: Well, on our platform uniquely, the products that trade in our catalog, you can see the reference price, the last trading price for those products. And so, we should always represent exactly what the current demand for those products are. You're right in saying that there are certain categories maybe more well-established in our apparel business. And watches and handbags has been growing tremendously. And you can see that absolutely reflected in the real-time trading of those products.

For us, as we look at other categories to expand into, we come back to what is the focus of that next generation consumer, the millennials and the Gen Z consumer? And we're, again, focused on those items typically that are limited in their release and then have tradable value thereafter. And what you're seeing for many brands-- and that includes some of the biggest luxury houses in Europe, as well as consumer brands, are leveraging drop models, release models, collaborations, to create inspiration for consumers to get those products. And then, they become very highly sought after and trade really well in the aftermarket.

JULIE HYMAN: Scott, Myles just alluded to NFTs. You guys there yet? I don't think you have NFTs on the platform yet, right?

SCOTT CUTLER: So as we look at the future of our business, we've always been a business, the original tagline was, "the stock market of things." And we do believe that. And when you look at our customer-- for example, we recently launched in Australia. One in four Australian adults want to buy a limited release sneaker. 40% of them are doing it for the investment value.

And so, as we think of these as alternative assets and investments, we think there's a great opportunity for the representation of these in the digital world, whether that be an NFT or a token or a fractional opportunity. Most of the items that trade on our platform today are trading as assets, but they involve a physical distribution of those assets. And we think there's a huge opportunity in this emerging area of digital goods and digital transactions.

JULIE HYMAN: We look forward to hearing more about that. And finally, the question that I usually ask you, Scott. You guys in your most recent funding round gave you a valuation of about $3.8 billion. From the outside, it doesn't seem like you're having any trouble raising in the private market. But as always, I'm curious what your plans are, if any, to enter the public market.

SCOTT CUTLER: So we look to the future, and that future involves execution on global expansion, vertical expansion, and product expansion in the business. So we've raised over the last couple of quarters a significant amount of capital to fund those growth and those ambitions. And that's where we're going to be focused.

BRIAN SOZZI: Scott, what's the most coveted sneaker on the platform right now?

SCOTT CUTLER: If you look at the last two quarters, not necessarily the highest coveted, but maybe the most velocity was the Jordan 11 Jubilee that was released in Q4 of last year. That's been a tremendously popular sneaker.

JULIE HYMAN: All right, Scott, it's great to see you. Thanks for being with us. Scott Cutler, the CEO of StockX, we will, of course, stay in touch.