Mint Condition - October 9, 2023
Mascot launches, newest player in burgeoning tech-driven inventory and sales management space
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Leading Off
During a time in the hobby where prices are continuing to be weak as compared to prior years and startups, within collectables and generally, are having difficulty securing new funding, it is an interesting time to see a new company launch, announce fresh partnerships, and look to establish itself in the hobby. But that’s what Mascot and Ezra Levine are up to.
Fresh off a stint leading Collectable, Levine is at the helm of a recently launched collectibles company, Mascot. Mascot helps collectors sync their inventory to its platform through integrations with grading companies and vaults, then efficiently list cards concurrently on multiple platforms, like eBay and MySlabs. The company hopes to save users time on both the frontend (consolidating, organizing) and backend (selling, shipping) of managing their collections. The service is free to users and Mascot is currently developing a premium version that would be available for purchase, presumably with greater capabilities like dynamic pricing.
What is my take on Mascot, the problem it is trying to solve for, the solution it introduced, and the competitive landscape?
Let’s get into it…
Mint Condition’s Take:
(1) Not attempting to develop own marketplace is a plus
Rather than focus a key part of its strategy on trying to establish its own scaled, liquid marketplace, Mascot is focusing on feeding inventory into other marketplaces where users can sell their cards. While an internal, proprietary secondary marketplace is highly lucrative, it is also extremely difficult and takes immense time and energy to promote enough buying and selling to make it worth customers’ time to utilize it, as Levine is familiar with given this was a dynamic that Collectable experienced. As a starting point for a new company, bypassing marketplace creation is a good use of resource allocation. It should be on Mascot’s roadmap for later. Over time, the company will gain learnings from customers’ experiences with its partnered marketplaces, like eBay and MySlabs, to inform what users value in their selling experience, helping it develop a customized offering.
(2) Tougher startup funding environment, but Mascot not planning to raise
Overall across the venture landscape, it is a difficult time for startups trying to raise money. The overhang from huge fundraising in 2021 at inflated company valuations combined with higher interest rates today and the *still* looming potential recession has made it a complex time to try raising money for a new venture. Within collectables is no different. Per Levine, Mascot is well-funded, supported by highly successful and affluent entrepreneurs, and has no current plans or need to raise funding.
(3) Who is the target market?
With recent announcements, it is clear to see how Mascot is looking to acquire customers. Partnerships with CGC, through which the company is now a multi-sales channel partner, and The Philly Card Show, through which vendors and dealers can upload inventory for show attendees to browse on Mascot’s site, show that Mascot is looking to attract inventory from (1) collectors who grade their cards and (2) vendors / dealers looking to make their business operations more efficient. Specifically going after graded cards is a unique approach, whereas other slices of the market, like raw cards, are being targeted by competitors, like CardDealerPro (CollX). But targeting dealer adoption is a strategy that Mascot, CardDealerPro, and MAGPIE (among others) are all trying to accomplish, each with different technology, levels of automation, and go-to-market approaches.
(4) Who wins? Can there be multiple winners?
It’s too early to say who wins given the early stage nature of each of these companies and the potential for new entrants. But I believe the successful companies in this vertical will do so through superior (1) technology, (2) user experience, (3) uniqueness and breadth of partnerships, and (4) monetization strategy. (a) Develop tech that makes for (b) an easy, sleek, time-saving customer experience, (c) forge partnerships across the hobby to bring inventory and users to the platform, and (d) find the right way to monetize what you build in (a) and (b) is the recipe for success here.
One other point on potential new entrants…there are now a few companies in the industry targeting somewhat similar problems. There is a chance that will catch the eye of a larger hobby participant, like Fanatics or PSA, who looks to develop its own solution or, later down the road, acquire one of these startups if early success is seen and the problem they are trying to solve proves to resonate across the hobby.
As always, I would love to hear your thoughts. You can reach me at jbmintcondition@gmail.com or on Twitter @jbmintcondition
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