Listia

Listia was soft launched July 26, 2009[4] and publicly launched on August 6, 2009.[3][5] In 2010, the site passed the 1,000,000 auction mark and was named one of the top 100 websites of 2010 by PC Magazine.[6]

On January 31, 2012 Listia announced that they had over 1 million registered users, with listings in over 3,000 cities. They also launched their official Android app.[7]

On July 18, 2012 Listia launched their Rewards Store to allow users to get brand new electronics and other goods with their Listia credits from big online retailers. The company stated that “by creating a Rewards Store, we hope to incentivize more people to unlock all the idle value sitting in their closets and homes.” [8][9]

Listia originally received funding of $15,000 from startup funding firm, Y Combinator.[3] In October 2009 Listia received $400,000 in funding from Implistic Capital in an angel round with Adam Pearsall joining the board of directors.[10] In April 2011, Listia raised an additional $1.75M in funding from Andreessen-Horowitz, SV Angel and other investors.[11] They also announced the launch of their iPhone app to bring the marketplace to mobile devices. Led by General Catalyst Listia received $9M in Series A funding in October 2013, Neil Sequeira also joined the board of directors. The funding will be used to help develop their mobile apps and internationally in 2014.[12]

On Jan. 18, 2013 Listia Partnered with Best Buy to offer various items on Listia to its members. The users may use their virtual currency to purchase new merchandise which is fulfilled by Best Buy using the BBYOpen API.[13] The "Rewards Store" is also a tool to help control inflation on the site as the credits used to purchase merchandise from Listia's rewards store are removed from the economy instead of another user which would have the opportunity to spend them. Previously Listia used Amazon to supply their "Rewards Store" and currently still use it to fulfill Amazon gift cards.

Listia has also partnered with Walmart in 2014 to increase the types of merchandise available in the "Rewards Store" beyond electronics and gift cards.[14]

Listia has a monthly charity program[15] that donates up to $4,000 each month to two charities chosen by the company and community. In the past, Listia has raised money for charities such as the ASPCA and the American Red Cross, among others. Listia users can help raise money for the charities by purchasing stars with their credits each month.[16]

Listia has created a system called Listia Credits to help facilitate trading on the site. Users earn credits during sign-up and then continue to earn more as they place items in the marketplace. Purchasing credits is also an option, and is Listia's main business model. Users may also gain credits by leaving feedback, completing offers on the site, participating in promotions, and general courtesies.[17]

Closed Loop System

Listia credits are not classified as a true currency, but are a closed-loop stored value[18] system. Credits are usable only within the limited scope of the Listia marketplace and cannot be exchanged or redeemed for money at any time.[19] Credits also cannot be gifted or transmitted between users outside of a legitimate auction in the marketplace.

Inflation and Deflation

The number of credits a particular item will sell for has fluctuated over time due to various causes such as inflation and deflation during the early part of Listia's history. As the marketplace matured and liquidity increased, the fluctuation has decreased but prices still shift up and down based on current supply and demand trends. Looking at the history of one of the most popular items on Listia (Amazon gift cards) the scale of the price fluctuations can be seen.

In October/November 2009 a $5 Amazon gift card would sell for about 300-600 credits.[20][21] By August/September 2010 $5 Amazon gift cards were going for double the price, 1000 credits.[22][23] Looking at Amazon gift cards in May–October 2011 a $5 card sold for 2900 credits.[24] Current auctions for these gift cards top 1500 credits per dollar.[25][26]

Credits to Cash

Starting in 2015, Listia silently released the option to sell credits for cash to select users. In order to qualify, the user must have the Trusted Seller's Badge (15 consecutive positive seller feedback on auctions they hosted and maintained a minimum 95% seller rating for 20 days)[27] and have had accumulated 500,000 credits through their own auctions in the previous month. The user's payment is handled through PayPal. Since the option to sell,credit inflation has skyrocketed. As of now in March 2016, $1 = 7850 credits. Just last week it was 7500. <link>https://www.listia.com/credits/sell</link>.[28][29] As of January 2018 Listia announced it would use the rate of 27,500 credits = $1.[30]

XNK (cryptocurrency)

On February 28 Lisita added a new currency to their marketplace [31] which was developed by the team and advisors.[32] The currency uses the Ethereum blockchain and can be used in and outside of Listia. A total of 500 Million XNK was created, 6% reserved for existing Listia users, 30% sold via private presale, and two public capped presales, 32% retained by Listia, vested over 3 years, 32% allocated for distribution and incentivizing the network, released over 3 years.[33] The presale token sale occurred January 22, 2018 funding 15 million dollars with a n ICO price of 14 cents for 1 XNK.[30] As of October 2018 the price of XNK is 1.6 cents per XNK, a decline of 88.5% value.

Fraud

Listia uses a third party Sift Science which uses large-scale machine learning to automatically discover new fraud patterns. These patterns are found by checking particular page navigation sequences, IP ranges, email address patterns, graph connectivity structures, browser configurations, and various others. An example Sift Science gives is that a user who signs up and waits an hour before making a purchase is 7x more likely to generate a chargeback than a user who makes a purchase immediately after signup.[34]

Terms of Service

Listia has been known to update their terms of service (ToS) without notifying their users of the changes. Comparing the text from the ToS from August 9, 2009[35] to the current text displayed on the site using text-compare.com there are multiple instances of changes, some favorable to the company and others to the consumer. Per Douglas v. U.S. Dist. Court a company must notify their users when the site decides to update their Terms of Service otherwise the new contract cannot be enforced.[36]

Changes of significance benefiting Listia:

-the right to read private messages.

-hold a sellers credits in "pending" until items are delivered.

-only allowing a single account per computer.

-adding an exclusion where they are not liable to refund or help recover shipping expenses to a buyer.

-may remove credits from a members account.

-Listia's mediation is final and binding to all involved parties.

-removed credits having a cash value of 1/100th of one cent and the ability of a user to redeem credits for money with Listia.

-The credits are now a virtual token representing a contractual permission to access features and services on the site. Allowing them to charge fees to acquire or use credit. Listia may revoke the credit license at any time without notice for various reasons.

Changes of significance benefiting the consumer:

-ability to create four instead of two accounts per household.

-no longer have to possess the item you're posting on their site, thus allowing drop shipping options.

-no longer have to be the sole owner of an item, thus allowing digital material to be transferred if you have the right to do so.

Listia App

A 2017 update to the Listia app requires auction winners to take an extra step by agreeing to transfer credits. Without that extra step, auctions cannot proceed. This has led to frustrated sellers canceling sales due to non-payment and buyers getting their accounts suspended, some with millions of credits earned, purchased, or both. Listia has yet to address this problem.

Listia agreed to pay $190,546 in back wages and damages to 61 current and former employees after the Wage and Hour Division of the Department of Labor conducted an investigation. The company violated the Fair Labor Standards Act's overtime, minimum wage, and record-keeping provisions. Customer service employees were not paid overtime for hours worked beyond 40 in a week and in cases minimum wage. Listia also misclassified some employees as exempt from overtime pay and considered others as volunteers. The volunteers were not paid only given credits towards purchases on the company's website.[37]

• Official website