The vintage and pre-owned luxury watch market is thriving like never. It has transformed dramatically over the past few years with the arrival of strategic investors. One of the world’s leading second-hand watch e-commerce platforms, WatchBox, recently secured USD 165 million in funding to support its expansion. MONOCHROME reached out to Justin Reis, CEO of WatchBox, to discuss the development of the company and its plans for the future.
Xavier Markl, MONOCHROME – The second-hand or pre-owned luxury market is growing fast. So did WatchBox. What has been the road so far?
Justin Reis, CEO of WatchBox – Since WatchBox launched, we’ve welcomed physical expansion, a shifting mindset amongst collectors, the embrace of the pre-owned category by the industry, a global pandemic, and unprecedented demand for high-end, collectable watches. This “road” is an expressway!
We launched WatchBox in November 2017, and in addition to our headquarters in Philadelphia, we established a presence in Hong Kong with the opening of our Collector’s Lounge in Central. Less than a year later, Patrik Hoffmann joined our team to lead WatchBox’s expansion into Switzerland and across Europe. In late 2019, we celebrated the opening of a Collector’s Lounge in Singapore and established a joint venture with Ahmed Seddiqi & Sons to launch WatchBox Middle East. With each new market, we get closer to our community, allowing us to deliver the highest quality service, tailor our inventory to meet consumer interests, and further the knowledge and passion for watch collecting.
What makes WatchBox’s proposition unique?
Having an established global footprint in the world’s major watch markets, combined with the incredible knowledge, passion, and commitment from our team to meet and exceed the needs of our clients worldwide, stand out as our greatest differentiators. We’ve structured our business to become lifelong partners with our clients and share in their collecting journey, and this is built upon a foundation of trust, education, and a shared passion for watches.
Our inventory is a perfect complement to this passion. WatchBox is home to the greatest collection of watches – from special pieces by independent brands and watchmakers to an extensive selection from the top brands – all of which is owned and in peak condition. As an inventory-based operation, WatchBox authenticates and invests in every piece that we sell, and our global quality standard ensures that each watch will be as close to “mint” condition as possible without compromising value at the time of sale.
What makes the WatchBox proposition most unique is this intersection, bringing knowledge and access to the most collectable watches in the world to our global community, without friction and with a shared love for collecting.
You have just secured USD 165 million in funding. How will WatchBox continue to develop its activities?
We will be investing heavily in media and technology as we continue to scale our platform, which will be in parallel to physical expansion into new markets across the U.S. and internationally. Throughout 2022, WatchBox will develop a presence in New York, Los Angeles, Miami, Houston, and Dallas, plus Zurich, Tokyo, and Riyadh.
What is your ambition?
Our ambition is to continue to develop the WatchBox community – a global and diverse group of enthusiasts and collectors connected by a shared fascination – while bringing together the world’s most collectable watches and sharing in experiences of discovery, education, and absolute enjoyment.
What are the growth drivers for the secondary market?
- The demand for high-end watches by the most recognised and established brands exceeds market supply, leading people who never previously considered purchasing a pre-owned timepiece to enter the category.
- The secondary market affords access to timepieces not readily available on the primary market, from the in-demand and recently discontinued Patek Philippe 5711 to so many pieces in the modern Rolex catalogue and the extraordinary collections by leading independent watchmakers.
- The (still) new culture of pricing transparency in the secondary watch market provides collectors with the confidence and trust to invest in more expensive items, knowing that there will be a market for them should they wish to trade or sell these items in the future.
- PLUS, the rise of resale and the circular economy.
What would your advice be for novice collectors?
So many people will simply tell you to “buy what you love,” and I want to take this a step further. Have the confidence to collect eclectically, buying watches you truly like, and trading pieces that no longer bring you enjoyment or that serve as steppingstones to something else. Focus on making your watch purchases meaningful, learning about what drew you to any given piece, enjoying the process of discovery, the rituals around wearing your watches, and the dynamic community of collectors and enthusiasts.
A trusting relationship with the seller or dealer is among the most important factors in collecting, whether you are a novice or experienced collector. This extends from a guarantee of authenticity to a watch being in the condition described when it arrives at your doorstep, a warranty to cover issues related to mechanical defects, transparency into market value, and a commitment to help you find the right watch for you. Trust is the foundation for so much enjoyment – for both the collector and a company like WatchBox. Our team is truly obsessed with watches, and we love sharing in our clients’ collecting journeys.
Prices on the secondary market have risen sharply? Can we expect a correction at some stage?
The secondary watch market is stronger than ever, and while we anticipate some pricing stabilisation for extraordinary outliers, the overall macro trends are intact. This current strength gives consumers the confidence to purchase and invest in more expensive items, knowing that there will be a market for them should they wish to trade or sell these watches in the future.
The market for luxury collectables has been transformed throughout the pandemic era, opening watch collecting – which was once considered a niche hobby – to a much broader audience and accelerating changes taking place over the last decade thanks to social media and the internet. The market is getting bigger and bigger. And while watch collecting remains a hobby of pure passion for so many in our community, the energy and media attention has attracted many newcomers to the space, both new and emerging collectors, as well as those with an appetite for alternative investments. The demand is expected to continue exceeding supply on the primary market, which in turn perpetuates the current dynamic.
A few weeks ago, you acquired a majority stake in independent watchmaker De Bethune. Can we expect other such investments from WatchBox?
The opportunity to invest in great watchmakers will always be on our radar, especially in the realm of independent brands and brilliant watchmakers who have yet to benefit from the infrastructure of larger companies. We are incredibly proud to support Denis Flageollet and Pierre Jacques as they drive De Bethune’s next chapter of extraordinary watchmaking.
For more information, please visit www.watchbox.com.