Client Name

Fleek Commerce Inc

Faculty Advisor

Ms. Zahra Riaz Nakhoda

SBS Thought Leadership Areas

Entrepreneurship and Innovation

SBS Thought Leadership Area Justification

Our thought leadership area is entrepreneurship and innovation, and this project sits at the heart of both. Entrepreneurship is not just about starting something new. It is about making decisions under uncertainty, and doing that well requires knowing where value actually comes from in a business. That is precisely what this project set out to uncover for Fleek.

We found that 87% of Fleek's customers generate only 24% of its revenue, while retailers, who make up just 9.5% of the customer base, produce the largest pool of profit. The working assumption at the start of the project was the complete opposite. Overturning that assumption through data rather than intuition is what we see as innovation in its most practical form: it directly changes how a business allocates its attention and resources.

Our work shows that innovation does not always mean building something new. Sometimes it means helping an existing business see itself clearly for the first time, measuring profitability at the customer level, identifying which relationships are worth investing in, and replacing gut feel with a framework grounded in real evidence. That is the kind of thinking we believe drives sustainable entrepreneurship.

Aligned SDGs

GOAL 6: Clean Water and Sanitation

Aligned SDGs Justification

SDG 11: Sustainable Cities and Communities

The platform serves a large urban reseller base operating within cities, many of whom run small local thrift businesses or sell online from home. By helping Fleek identify which of these buyers are most valuable and how to retain them, our work supports the viability of small urban commerce built around second-hand goods. The US retention finding is particularly relevant here: a 28% repeat rate in a high-income urban market represents a missed opportunity that, if addressed, could deepen Fleek's role in urban resale communities across North America.

NDA

No

Abstract

This Experiential Learning Project looks at who are the real value creators within a booming B2B space, by analyzing 15 months’ worth of transactions from Fleek Commerce Inc, a Y Combinator-backed platform, which connects vintage clothing wholesalers from Pakistan and beyond with resellers and retailers in Europe, North America and Australia. It takes the debate away from the retail purchases and into sustainability- which is re-purchasing of resellers, where is the profit margin and where is the next pound of acquisition spend going.

With an export of 102,675-line items, 96,455 orders and 48,295 unique customers, we built the customer base from the ground up from the export data and not from our own assumptions. Three results are noteworthy. There is a significant concentration of revenue as the top 20% of customers contribute about eighty-three per cent of gross merchandise value. The three types of customers are like three different businesses: resellers are many but small, wholesalers are few but very large and retailers fall somewhere in between and have the greatest absolute size of margin. Retention is structurally strong in most markets, but is clearly weak in the U.S. where the rate is twenty eight per cent, which is significantly lower than France's seventy two per cent.

Validation was an important aspect of the work. All data has been validated by Mr Hamid Malka who carefully validated all numbers such as the concentration ratio, a blended contribution margin of 28.5 per cent, and a retention figure of 12.6 per cent. All of these have been derived from first principles and are presented here along with the method used, its data lineage and, if the figure is based upon assumptions rather than observation, a sensitivity range. The report ends with four prioritized recommendations and a discussion of the limitations of making recommendations based on a data set that captures revenue and all costs associated with it.

Document Type

Restricted Access

Document Name for Citation

Experiential Learning Project

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