After less than two years in the role, John Koryl has stepped down as CEO of The RealReal, the prominent online luxury consignment platform. The company announced this leadership change on Monday, naming Rati Sahi Levesque as the new chief executive officer, effective immediately. Levesque, a co-founder of The RealReal since its inception in 2011, has been instrumental in shaping the company’s trajectory, holding various leadership positions in areas such as sales, merchandising, and marketing.
Levesque’s appointment comes during a critical time for The RealReal, as the company is working to stabilize its operations and improve financial performance after facing significant challenges in the luxury resale market. Under her leadership alongside former CFO Robert Julian as interim co-CEOs, the company began implementing major changes aimed at achieving profitability. These reforms included revisions to the commission structure that now favour higher-value items, like jewelry and iconic bags from brands such as Hermès.
The move to hire Koryl in early 2023 was intended to bolster these efforts, as he brought experience from Neiman Marcus to help navigate the company’s financial struggles. His tenure included efforts to refine customer service offerings and further adapt the commission structures. Notably, The RealReal achieved EBITDA profitability for the first time since its IPO in 2019 during the fourth quarter of 2023, a milestone that reflects the effectiveness of these strategic changes.
For fiscal 2024, The RealReal forecasts adjusted EBITDA between $4.5 million to $7.5 million, a dramatic turnaround from the adjusted EBITDA losses of $55 million in 2023 and $112 million in 2022. However, this journey toward profitability has not been without its downsides. The company’s gross merchandise value (GMV) fell by 5% year-over-year in 2023, dropping to $1.7 billion. Looking ahead, The RealReal expects to reach a GMV of about $1.8 billion for 2024.
The board’s confidence in Levesque is palpable. Karen Katz, chairperson of the board, expressed strong support for the new leadership, emphasizing that Rati and her team are positioned to advance the business effectively. Koryl’s departure was framed positively, with the board wishing him the best as he focuses on family matters.
Despite the favorable financial developments, challenges remain. Many consignors have expressed dissatisfaction with the platform, feeling that reselling luxury items is not as financially rewarding as it once was. This sentiment threatens to impact the inventory and variety of items available on the platform, which is crucial for a resale business reliant on consignors willing to list their items for sale.
Levesque’s rich experience within The RealReal makes her an ideal candidate to address these issues head-on. As the first employee of the company, she has witnessed the evolution of the current landscape of luxury resale. Her understanding of the business, coupled with her previous leadership roles, uniquely positions her to better align offerings with the interests and needs of consignors while staying committed to increasing profitability.
The RealReal’s trajectory highlights a critical phase in the luxury resale market. As consumers continue to seek sustainable and cost-effective shopping options, platforms like The RealReal must navigate the fine line between profitability and attractiveness to sellers.
In conclusion, Rati Sahi Levesque’s ascension to the CEO role showcases a deep-rooted commitment to reinvigoration and understanding of the luxury resale landscape. Her leadership will likely influence the company’s ability to foster relationships with both buyers and sellers, ensuring that The RealReal remains a significant player in the luxury commerce space. The ongoing evolution within the company will be closely watched by industry experts and consumers alike as it unfolds in the upcoming fiscal year.
