Inside the Sneaker Resale Economy, From Flight Club to StockX

In 2016 Supreme sold a red clay brick stamped with its box logo for $30. It was a joke, and eBay listings reportedly climbed into the hundreds of dollars. That brick explains the sneaker resale market better than any spreadsheet. The retail price is a suggestion. The real price is whatever the second buyer will pay, and an entire industry now exists to set it.

Around 2021, widely reported estimates put the secondary sneaker market at about $10 billion, and StockX forecast it could reach close to $30 billion by 2030. That forecast is a company figure, so read it as a pitch as much as a measurement.

The consignment wall

Before the apps, there were shops. Flight Club opened in 2005 as one of the first consignment stores for sneakers, and it is often described as a museum, with its rarest pairs priced well into five figures.

Consignment is simple. A seller brings in a pair, the shop checks it, sets or agrees a price and puts it on the wall. When it sells, the shop keeps a commission and the seller gets the rest. The seller never has to meet the buyer. The buyer gets something close to a guarantee, because the store's reputation rides on every pair. Stadium Goods later built a similar business around reselling collectible models above their original retail.

The shops did something else. They made resale respectable. A wall of deadstock Jordans with price tags in the thousands turned the Air Jordan 1 and the Nike Dunk into assets with visible prices.

Detroit's stock market

StockX took that model online and gave it a trading screen. The company was founded in Detroit in 2015 and launched in February 2016. Its founders were Dan Gilbert, Josh Luber, Greg Schwartz and Chris Kaufman. Luber had run Campless, a site that tracked rare sneaker prices, which Gilbert acquired before Luber moved from Philadelphia to Detroit to lead the new company.

The pitch was a stock market for things. Buyers place bids, sellers place asks, and when they meet the trade happens at that price. The seller then ships the pair to a StockX facility, where staff inspect it before sending it on. Counterfeits go back to the seller and the buyer gets a refund. StockX has run authentication centers in Detroit, Tempe, Moonachie in New Jersey, West London and Eindhoven. Historically the fees came in two layers, a transaction fee that drops as sellers do more volume and a payment processing fee.

The model scaled quickly. StockX raised money at a $1 billion valuation in June 2019, and in April 2021 Reuters reported a $255 million round that valued the company at more than $3.8 billion. StockX said it sold $1.8 billion in merchandise in 2020. It moved into electronics that November and announced NFT trading in January 2022.

GOAT grew into the other giant. TechCrunch reported in February 2017 that it had raised a further $25 million to expand its mobile marketplace, and the two are generally described as the platforms that dominate the market. eBay answered with an authentication program of its own for sneakers, which CNN covered in 2021.

Bots, raffles and the war at the front door

Resale needs supply, and supply means beating everyone else to retail. That is where bots come in, custom programs that hit release pages faster than any human can. The best bots are themselves sold in limited quantities and resold on forums and Discord servers for well above their original price. Small boutiques struggle most, because they lack the resources to keep the bots out.

Nike's answer was the SNKRS app, launched in 2015. It uses variations on a raffle, including timed draws, and over time it leaned more and more on draws instead of first-come, first-served sales. The results have been mixed. Raffles feel fairer, but they also make every pair feel scarcer, which only feeds the second market.

None of this is new. In Japan in the mid-1990s, demand for the Nike Air Max 95 ran so hot that it was linked to muggings and a flood of fakes. Collaborations made the effect sharper. The pairs from Virgil Abloh's The Ten and the Uniqlo shirts that KAWS released in 2019 were resale stories before they were fashion stories, and the most coveted low-run releases can trade at many times their original price.

Who wins

Brands have a complicated relationship with the market. Resale prices are free marketing, the clearest public proof that a shoe is hot. They also send profit to people the brand never sees. Stores like Kith built their reputations on making retail an event so that buying first-hand still felt special.

The buyer's side has changed most. Twenty years ago you needed to know a guy. Today you need an app, a card and patience while a pair travels through an authentication center. The StockX Wikipedia entry and the page on sneaker collecting cover the history. For more, explore our sneaker releases and sneaker history hubs, or the rest of our culture section.

Flight Club's rarest pairs carry five-figure tags. The Supreme brick cost $30. The market treats both numbers with exactly the same seriousness.