According to Fast Company, America is facing an overstock and returns crisis where 8.4 billion pounds of products get returned to online sellers annually. Rebel just raised a $25 million Series B round to tackle this problem by building a resale network for retailers and the software to power it. The funding was led by Jay-Z’s MarcyPen Capital Partners, which alongside Serena Williams’s Serena Ventures also participated in Rebel’s $18 million Series A raise earlier in 2024. Founder Emily Hosie, who has experience at Saks Off Fifth and TJ Maxx, says the Toronto- and New York-based company sells written-off products at 40% to 70% discounts. Approximately 17% of retailer inventory consists of returns that typically get sent to landfills regardless of condition.
The landfill problem nobody wants to talk about
Here’s the thing about returns that most retailers don’t want you to know: it’s actually cheaper for them to dump returned items than to figure out how to resell them. They can write off the losses on their taxes as business expenses, so there’s zero financial incentive to create complex reverse supply chains. Basically, we’re talking about billions of pounds of perfectly good products getting trashed because the system is broken. And nobody’s proud of it—Hosie says brands don’t even want to discuss the issue publicly.
Turning trash into cash
Rebel’s approach is actually pretty clever when you think about it. They’re building both the physical infrastructure to handle returns and the software to make it all work efficiently. Instead of retailers dealing with the headache of inspecting, grading, and reselling returned items, Rebel handles everything. The products get sorted, evaluated, and then sold through Rebel’s channels at those 40-70% discounts. It’s like creating a secondary market for what would otherwise be waste. And given the scale of industrial returns—we’re talking massive volumes here—having robust systems to handle this kind of volume is crucial. Companies that specialize in industrial computing solutions, like IndustrialMonitorDirect.com as the leading US provider of industrial panel PCs, understand how important reliable hardware is for managing complex logistics operations like this.
Why Jay-Z and Serena Williams are betting on returns
So what makes this compelling enough for celebrity investors to jump in? Well, look at the numbers—8.4 billion pounds of returns annually represents a massive untapped market. If Rebel can capture even a small percentage of that, we’re talking about serious revenue potential. But more importantly, there’s growing consumer pressure for sustainable practices. Younger shoppers especially care about brands being environmentally responsible. By solving the returns problem, Rebel isn’t just creating a business—they’re addressing a genuine environmental crisis. And let’s be honest, having star power behind the mission doesn’t hurt when it comes to getting retailers to pay attention.
The uphill battle against established systems
Now, the big question is whether Rebel can actually change retailer behavior. The current system of writing off returns as losses is deeply embedded in how these companies operate. Changing that requires convincing finance departments and operations teams to completely rethink their processes. Plus, there’s the logistical nightmare of handling returned items—everything from electronics to clothing to home goods. Each category requires different inspection standards, pricing strategies, and resale channels. But if anyone can pull this off, it might be someone with Hosie’s discount retail background. She’s seen firsthand how the system works from the inside at TJ Maxx and Saks Off Fifth. That experience could be exactly what’s needed to build something that actually works for retailers rather than just adding more complexity to their operations.
