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Eco-friendly and Obama-approved

Eco-friendly and Obama-approved: a boutique store turned into China’s hippest new online marketplace

Two years ago, Bunny Yan opened up a boutique store in Shanghai selling accessories and home items. It focused on sustainably-produced goods – “impact products,” as Bunny calls them. The shop curated the work of a handful of local designers who produced upcycled and recycled bags, jewelry, and various home goods. It was nice and homey. It didn’t seem like the kind of company that, in 2015, would have its founders raking in hundreds of thousands of dollars in funding and meeting Barack Obama.

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“We opened the store to see if there was a market in China for impact products,” Bunny tells Tech in Asia. “The results were very positive.”​

Tapping into a trend

While running her brick and mortar shop, called The Squirrelz, Bunny made connections in the Shanghai design scene and sized up the potential market for socially-responsible goods in China.

“The vintage trend in Shanghai is very hot. The idea of having somebody else’s things is no longer taboo,” she says, noting that, until recently, there was not much of an appetite in China for previously owned or used goods. “We are really pushing the idea that we upcycle – it’s not that the things are collected from garbage cans.”

Chinese attitudes towards recycled and sustainably-sourced goods have become more accepting in the last few years, and Bunny believes she spotted a gap in the market. The folks at Chinaccelerator seemed to agree: her business was accepted into the startup acceleration program at the beginning of 2015, and it took off from there.

While in Chinaccelerator, The Squirrelz expanded its team, raised funds, and designed a website to bring Bunny’s upcycled, eco-friendly products out of her shop and online.

The Squirrelz drew the attention of the White House, which hosts the Challenge Cup by 1776, an international tournament that brings together startups from around the world. Bunny and The Squirrelz represented China at the event in May, where they made connections with other entrepreneurs, gained quite a bit of publicity, and met President Obama.

Curators gonna curate

The Squirrelz emerged from Chinaccelerator with a healthy amount of funding, an expanding team – now a dozen full-time employees – and a website in beta. The site, which officially went online earlier this month, resembles certain corners of online marketplaces like Etsy, with one notable difference: The Squirrelz curates its collection and does a lot of the leg work.

“We offer a service platform,” Bunny says. “We do all of the photos, the content, and the marketing. So the designer can just focus on making great products.”​

The website initially launched with ties to about 40 designers, with dozens more in the pipeline. In addition to presentation and curation, The Squirrelz also gives its designers data on their sales – how many are buying, where they’re shipping to, and more.

For these services, The Squirrelz takes a hefty 50 percent commission. But, Bunny says, the designers have welcomed the service with open arms. There is no fee to feature your goods on the site in the first place – you only pay a commission per sale – and many designers also feature their goods in other stores in addition to The Squirrelz.

“We worry about the business end and the marketing end,” says Bunny. “Most designers aren’t into that. They hate it.”

The company also does spot-checks to make sure designers are holding up their end of the sustainably-sourced bargain. When one producer, who made wallets from old car tires, seemed to have access to rubber that looked a bit too perfect, The Squirrelz checked in on him. Fortunately enough, the designer checked out, and the wallets were made from genuinely upcycled rubber – it just happened that this one designer had a particularly excellent source of old tires.

Selling the brand
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“It’s still just the more educated, trendier Chinese who don’t find upcycle/recycled things to be dirty,” Bunny says. “But the sheer numbers – how big China is – make it work.”​

“A lot of our products are made from defectives and overstock from factories,” says Bunny. “They were never circulated.”​

It takes a bit of effort to entice the local Chinese market, many of whom aren’t familiar with the concept of upcycled, recycled, or socially-conscious goods. But The Squirrelz’s sales are growing, as is its customer base. While they initially shipped mostly in Shanghai, recent weeks have seen orders come in from other cities in mainland China, as well as Hong Kong and Taiwan.

The company is currently in seed funding, but is eyeing a series A round when the time is right. They are also building a service to link factories with designers – a plan which would help factories get rid of their excess materials, and which would supply designers with a steady flow of fabrics and textiles to be upcycled into new products.

The Chinese ecommerce market is one of the world’s toughest: juggernauts like Alibaba’s Taobao and Tmall are so popular and powerful that any newcomers are immediately facing an uphill battle. But The Squirrelz aims to be different. By focusing on genuine upcycled, recycled and eco-friendly products, curating their own collection, and establishing relationships with local designers, Bunny and her team are seeking to create a space that’s essentially the opposite of the cheap, fast, and haphazard-quality models of many Chinese online retailers.

Bunny adds, “We want The Squirrelz to be a platform that you can trust.”

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