What started with a transaction in a parking lot with a Georgia Tech student has led to a successful exit within the luxury watch space.
Atlanta-based Crown & Caliber, an online marketplace that professionalized the sale of second-hand and pre-owned watches, was acquired earlier this month by HODINKEE.
Based in New York, HODINKEE serves as a media platform for the industry.
Hamilton Powell, Crown & Caliber founder and CEO (and 4th generation Atlantan), told Hypepotamus that the acquisition is an “exciting opportunity for every one of us [on the team].”
“We have always admired HODINKEE. They are the undisputed content leader in the watch space.”
All employees will remain in Atlanta as the team builds within the HODINKEE brand.
“The watch space continues to grow. A lot of people thought that the Apple Watch might kill the watch industry. Actually, there’s a lot of studies that show that wearing an Apple Watch gets people used to putting something on their wrist,” he added.
Innovating & Building In the Watch Space
Powell’s background was in private equity and finance, but he started recognizing opportunities within the estimated $5 billion luxury watch space.
“Back in 2013, I saw what was happening in the “re-commerce” space, and noticed that there were a lot of players popping up in different verticals to help people buy and sell used products,” said Powell. “There were companies in the cell phone space, the handbag space, and the shoe space, but one of the verticals that wasn’t being satisfied in the luxury space was the watch industry.”
Now, Crown & Caliber’s Atlanta team has bought and resold over 80,000 watches through the platform, anywhere in the $1,000 to $25,000 price range.
For Powell, the watch industry operates very differently than other luxury items. Unlike handbags or shoes, which may have a shelf life of a couple of years, “a watch is made to keep on ticking. So every year you get $5 billion in new products going on people’s wrists, it’s not going out the backdoor into a scrapyard. It just accumulates. There’s an estimated $125 billion worth of mechanical watches just in the US alone, either on people’s wrists or in the closets….yet there hadn’t been an articulate, safe, trusted way to transact with that inventory.”
Powell admits that getting Crown & Caliber off the ground was a bit “clunky,” mostly as the team worked to build trust in the online retail space. “Who on earth is going to mail in their watch to someone they don’t know?”
The Future of Circular Luxury
But now, Crown & Caliber has found a unique niche in the professional second-hand, or circular luxury, market.
“The industry is white-hot right now. It’s growing four times faster than the traditional luxury industry. I think there are a lot of things fueling that.”
First, Powell said, sustainability draws many to the circular luxury market. “You don’t need to mine more gold. You don’t need to go create new shoes or handbags…you can get a second use out of existing inventory out on the market.”
Powell said that the search for individualized and quality style has also attracted new customers. “In the second-hand market, you can have things that other people don’t.”
Then there was the COVID bump. “We saw growth during COVID, and that was due to the hard work of our team iterating during a very fluid time for us. There was a lot of discretionary income that wasn’t spent on vacation and travel that instead was spent on assets like watches,” which Powell said is traditionally seen as a “safe-haven asset.”