Working Capital Turns ThredUp’s Resale Engine Into a Flywheel for Growth

In an economy where consumers are stretching dollars and seeking new ways to supplement income, consignment has become a sweet spot. ThredUp, the online resale marketplace, is leaning into that trend.

For sellers, consignments represent an additional stream of income; for buyers, they provide value at a time of inflationary pressures. For ThredUp itself, strategy is powered in no small part by how it manages working capital.

“We’ve seen a real opportunity over the last 12 to 18 months to use our working capital as a tool for growth,” Sean Sobers, CFO of ThredUp, told PYMNTS CEO Karen Webster. Because the majority of the firm’s business is done on consignment, he continued, “We’re not hanging up a bunch of dollars on the balance sheet related to inventory purchases. We’re able to take that working capital and reinvest it into the business and reinvest it specifically for growth.”

Managing capital in a volatile consumer spending environment requires context requires balance, Sobers said. “You don’t want to be too aggressive and you’re burning cash and you don’t want to be too conservative because then you’re just losing growth by not investing into the future.” He described it as aiming for the “Goldilocks strategy.”

Growth Corporates See Opportunity

PYMNTS Intelligence’s annual study with Visa on working capital efficiency found that growth corporates — middle-market firms with revenue between $50 million and $1 billion — are among the most aggressive adopters of working capital solutions. As Webster said, “What we found is that retail firms in this sector … are among the highest adopters of working capital solutions, with adoption rates nearing 90%. The interesting part is how they’re deploying capital, which is not to cover gaps, but to really invest for product innovation and strategic growth.”

Sobers said that reflects ThredUp’s posture. “We’ve focused on product improvement and product enhancements — things like AI [artificial intelligence] integration into our core experience with our customer.” Alongside that, investments have gone toward new customer acquisition and speeding the process of bringing fresh goods online. “You put those all together, and we can’t think of a better way to use our working capital,” he said. “At the end of the day, you take these three things that generate more revenue and then in turn it generates more cash. And we’ve got to keep this flywheel going.”

Read more: 2025/2026 Growth Corporates Working Capital Index

That flywheel depends not just on internal reinvestment but also on how financial partners support the business. “What we want out of our partners and our banks in particular is nimbleness,” Sobers said, “from the time a transaction happens to settlement. For me … I would love to see single-day settlement.”

ThredUp is also rediscovering simple but effective tools. “We’ve come back to one in the last 12 months, which was having a relationship with our bank in a way where we could do purchasing cards or credit cards … and use them to an extent where we want to try to get every vendor on that platform so we can pay them,” Sobers said. That structure lets ThredUp float cash for up to 45 days, while also generating rewards. “We’ve started to see that be pretty successful from a cash perspective,” he told Webster.

AI Insights Drive Forecasting

ThredUp’s business is built on data, with AI-driven, actionable insights. With more than a decade of transaction data, the company can model when items are listed, how quickly they sell, and what payouts will follow. Generative AI has expanded those capabilities.

“If we bring items on, we want to make sure we sell them, we sell them quickly with the lowest discount as possible, and that’ll drive our forecast on how much cash we’re going to bring in, and in turn how much cash we are going to have to lay out,” he added.

External forces are shaping the resale market, too. Sobers pointed to tariffs and the closure of the de minimis loophole: “We do think it’s good for the business, at least in the near term. … The gap from new to secondhand is getting greater.”

Sobers is optimistic about what’s next: “We’re able to accelerate the growth, to generate more cash as we go forward. And I would love to look back a year from now talking about that,” he said. “AI has been a bit of a game changer to help get customers and have customers transact.”

Liquidity also extends to the sellers who supply the platform’s inventory. “We want to get the best sellers to come back. And so we want to get them a great experience from the get-go,” Sobers explained. “What gives us that opportunity is we can pay people quickly, we can pay them efficiently, we can get it into their ThredUp account, and they can decide what they do with [the funds].”

That speed creates loyalty and drives the marketplace. Many sellers turn into buyers, while buyers eventually become sellers, reinforcing the ecosystem, what Webster and Sobers both agreed creates a “virtuous circle” of commerce.

PYMNTS CEO Karen Webster is one of the world’s leading experts in payments innovation and the digital economy, advising multinational companies and sitting on boards of emerging AI, healthtech and real-time payments firms. She founded PYMNTS.com in 2009, a top media platform covering innovation in payments, commerce and the digital economy. Webster is also the author of the NEXT newsletter and a co-founder of Market Platform Dynamics, specializing in driving and monetizing innovation across industries. 

Sean Sobers has served as chief financial officer of ThredUp since October 2019.