Exclusive: Sneaker Rental Platform Kyx Relaunches as Resale Site, Months After Abruptly Ceasing Operations

Just ten months ago, subscription sneaker rental platform Kyx World was moving forward on its growth plans.

Toward the end of October, the nascent company and alternative to the likes of StockX, Goat and eBay had just secured its third round of seed funding led by previous investors SeventySix Capital and launched a redesigned website.

The undisclosed amount of financing came just months after nabbing $3 million in a second seed funding round last February, which valued the company at $16 million.

But, one month later, Kyx World co-founders Brian Mupo and Steve Dorfman told employees that the company was out of money and that they would be let go. Social media activity on Twitter stopped in November and operations completely ceased by the end of December, leaving its customers wondering what happened.

Mupo and Dorfman had launched the company in June 2021 with the promise to provide sneaker lovers an affordable alternative to access limited-release footwear at a lower price point typically not found on secondary marketplaces.

At the time of its launch, the company offered three levels of access on its platform, charging subscribers $59 to $299 per month for access to over 300 styles from brands like Nike, Yeezy and New Balance, ranging in price from $100 to $1,500 on the resale market. Once the subscriber was ready to swap out the pair, they would send them back and Kyx World would clean them via its 10-step process and place them back on the site for the next person.

The concept quickly drew interest from major fashion companies and athletes, including Jeff Staple’s RAD Equities, Rachel Zoe Ventures, NBA All-Star DeMar DeRozan and Super Bowl champion Emmanuel Sanders, which all signed on as investors.

“The idea was a big deal at the time in the sneaker community,” Leland Grossman, the marketing advisor for the company told FN. “There was this sort of beautiful altruistic element of kids being able to wear shoes that they wouldn’t normally get to wear. That was really appealing. We were sort of hacking the business model, and investors like Jeff [Staple] really respected it.”

Grossman, who was onboard since the launch of the platform in 2021, told FN that while he isn’t certain what exactly happened with the founders nor the money, he is sure that the business didn’t fail due to lack of interest in its rental concept. “At one point we had over 2,500 active paying subscribers,” he said. “So, when we closed, our lead investor group felt there was a second life tied to the used sneaker business.”

Fast forward several months and Kyx Sneakers, as the company is now known, is ready for its comeback – reemerging from the ashes with a new logo, tagline and business model.

Under this new operation, the company’s two original cofounders are no longer involved. Instead, Grossman is back as marketing advisor and entrepreneur Jason McElveen joined as president. The team also brought back much of the old Kyx crew, including head cleaner Joe Banks, who notably used to work with Jason Markk. Original investors like RAD Equities, Rachel Zoe Ventures and Scott Keeney/DJ Skee have also come back to support the new venture.

“We acquired the name and assets of Kyx in February and have been working on building the new platform ever since,” McElveen told FN. “We soft launched in June and we’re now ready to shout from the rooftops that Kyx is back.”

The new small-but-mighty team now operates under the tagline “Meant to Be Worn” with the mission to be “the most trusted source to buy used sneakers” – transitioning its business model from rental to buying and selling pre-worn sneakers.

According to McElveen, Kyx’s relaunch features an offering of over 2,000 used sneakers retailing between $50 and $2,000. Styles on-hand include the Off-White Jordan 1 and Patta New Balance collab, along with plenty of other offerings from Adidas, Nike, Jordan and New Balance. The addition of smaller emerging brands is also in the works.

The executive noted that all of Kyx’s inventory is maintained in-house and can be shipped same-day, eliminating long wait times that come with purchasing from some online resale and peer-to-peer platforms. Each shoe is also thoroughly cleaned, and even a Kyx-branded air freshener is placed in the box, before being shipped.

“With Kyx, we’re not just selling sneakers; we’re building trust and reshaping the way enthusiasts and casual shoppers alike shop for their next favorite pair,” McElveen said.

He added that the company is promoting trust and transparency with consumers through a few ways. The first is through the use of 360-degree detailed product photos. “We noticed a lot of used sneaker sites were not using the actual photos of the pre-worn shoes, creating buyer confusion and a lack of trust,” McElveen noted. “Consumers should know that the condition of the sneakers you see on our site is what you can expect to receive in the mail.”

The second way is the launch and implementation of a new sneaker rating system designed to assess the shoe’s condition across five components, emphasizing those most visible. More specifically, Kyx looks at the condition of the shoe’s upper, midsole, outsole, tongue and laces and rates each component on a scale of one to ten. “Our rating system takes inspiration from how sports trading cards are graded and translated that methodology to sneakers,” McElveen said. “We have an extensive checklist that we go through for each shoe and try to rate them as objectively as possible.”

Lastly, Kyx guarantees authenticity through a multi-level process that uses artificial intelligence (AI) and human expertise. While McElveen didn’t go into specifics about the process, he did mention that if the shoe still seems suspicious, even after a it went through authentication, the company will get a second opinion before the sneaker is placed on the site.

Aside from selling used sneakers, Kyx is also now piloting a way for consumers to sell their shoes directly to the company. “We tried to make this selling option as simple as possible for customers,” the executive noted. “It’s all done through a form that includes submission of photos and we will then offer payment or store credit for sneakers that we are interested in acquiring.”

Looking ahead, McElveen is staying the course. “We want to give ourselves time to grow naturally, refine our processes and get the word out to consumers that we’re back,” he said. “Actually, a lot of our first customers were previous Kyx subscribers, which is very exciting. But, in the meantime, our main goal is to operate as a responsible business, and we’ll see what the future holds.”