Before becoming a global obsession worth billions, sneakers were the symbol of youthful expression and defiance of authority. Now, the sneakerhead culture is gaining a stronger foothold in Asia, and it is up to entrepreneurs like Richard Xia who are driving this culture towards a more vibrant, tech-driven and secure ecosystem.
Richard Xia is the Founder of Novelship — one of Asia’s largest platforms to trade authentic, limited edition sneakers, apparel, and collectibles. He currently employs over 60 team members, with presence in six markets — Malaysia, Singapore, Indonesia, Australia, New Zealand, and Taiwan — bringing in a monthly revenue north of RM9.3 million.
In recent years, the ideas of entrepreneurship and the startup grind have been gaining exponential prominence in Southeast Asia. In fact, considering the endorsements and praise given to entrepreneurs, running a startup is considered the “cool” thing to do today.
Getting to know Richard Xia:
What is your background, and how did you come to be doing what you’re doing?
I started Novelship with my long-time friend and schoolmate of more than 16 years, Chris Xue. Prior to Novelship, we have had two failed ventures together – from launching a mobile cafe to e-commerce software. The idea to start Novelship came from our mutual interests in sneakers and streetwear. As avid sneakerheads, we saw an enormous market opportunity across the APAC region, and wanted to solve our own problems with buying and selling sneakers and streetwear, namely availability and authenticity of the products in the region.
What have been the most useful skills you have learnt and applied in your journey?
One of the most useful skills I’ve had to learn is perseverance. Being an entrepreneur, everyday’s a grind and you need perseverance to continue doing the same tasks over and over again. Another skill I found helpful is focusing on making my milestones achievable. I’d split up my long term vision into annual goals and break it into quarterly, monthly, weekly, and daily goals. This helps me to keep things in check, celebrating wins and having visibility of where we stand as a business.
What’s the best piece of advice you ever received?
The best piece of advice I’ve ever received is from my startup mentor back in NUS. It’s “Never make any assumptions, and always do as much research as possible.” As a platform, we need to ensure that the features on Novelship are of high quality and effective for our users. For example, all the upcoming features that we are releasing this year such as storage option and instant delivery, were finalised after many rounds of research. We had to survey our users, and take the statistics into consideration. Every decision that we make at Novelship is based on intensive research.
Who inspires you?
It’d have to be Elon Musk and his journey as an entrepreneur. Despite the challenges and setbacks he faced, he overcame them and achieved so much. He taught me to believe in what I am persevering for. If I work hard enough and have a good strategy, anything is possible.
What have you learnt recently that blew you away?
Recently, I came to know of Augmented Reality (AR) technology for shoes. With a camera-equipped device such as your smartphone, you are able to project a pair of sneakers on your feet. I feel that the technology is not used enough in today’s market but it will definitely be revolutionary for the sneakers and streetwear industry. At Novelship, we aim to always provide the best for our users and will consider incorporating such technologies into our platform for the convenience of our users.
What is a major mindset change, belief shift or ‘ah ha’ moment that you’ve experienced in relation to your business?
The importance of data analysis. In the early days of our launch, our platform wasn’t created just for sneakers. We were also selling snacks and toys on our Carousell page. One day, we realised (through our analysis) that streetwear and sneakers made up 50-60% of our sales volume despite spending the same amount of time with other products. We saw lots of positive response in regards to this, hence we decided to just cut other categories out and focus on sneakers and streetwear.
About Novelship and the Industry:
What is your industry? What might people outside of your industry not know about it? Where is it going?
What excites me the most about sneaker reselling/culture is how much the market is worth and how much you can make by taking advantage of it. We’re in the limited edition sneakers space and due to its limited nature, most people out there assume that it is very niche or that it is a recent fashion fad. However, the sneaker scene has been around for the past 30/40 years, and is very much well established in the underground scene. With Novelship, we aim to offer greater accessibility and opportunity for anyone to trade/acquire sneakers and streetwear.
When it comes to the term “luxury sneakers”, what defines them as that? The brand perhaps? Or is it just a matter of price?
Generally speaking, luxury sneakers are most often sneakers released from existing high-fashion brands like Alexander McQueen, Balenciaga, Common Projects, and Gucci. In most cases a limited edition Air Jordan 1 would not really qualify as a luxury sneaker, however there have been exceptions. For example in 2020 Dior partnered with Air Jordan and released the “Dior x Air Jordan 1 High” which retailed for $3,000 USD and routinely sells for over $10,000 USD today.
Collaborations like this are sure to continue as luxury brands also blur the lines between “high” and “street” fashion moving forward.
How would you describe the luxury sneakers scene in Malaysia? Is it thriving? Is it growing rapidly?
Primarily we deal in limited edition sneakers from traditionally “street” brands such as Nike, Air Jordan, and adidas Yeezy. That being said, traditional luxury design houses are all moving towards releasing their own take on these sneakers, and in cases like Y3 by adidas, some of these traditional street brands are creating their own luxury lines to take advantage of the growth in this segment.
We know from experience that Malaysia has a thriving limited edition sneaker/streetwear scene, just attend Sneakerlah in KL and you’ll see nearly thirty-thousand attendees over the course of the weekend. As consumers become increasingly brand focused, it’s natural that the luxury sneaker scene will also see rapid growth.
How is the scene here compared to neighbouring countries like Singapore? Is there a difference in demand and design preference?
Buyer preferences across Singapore and Malaysia tend to be pretty similar, with Singaporeans spending a bit more on average when it comes to buying sneakers. However, as mentioned above, the passion for sneakers in Malaysia is present, one of the largest events in the region, Sneakerlah, is hosted every single year and attracts tens of thousands of enthusiasts from across the region to KL.
Overall, the two markets are quite interconnected, with a lot of Malaysian sellers flipping their items cross-border into Singapore to take advantage of higher buyer prices and move their items more quickly than they might be able to locally. As Malaysia grows and matures I’m sure we’ll see a larger percentage of our buyer volume coming from the country.
Can you tell us about the growth of Novelship, specifically where the Malaysian luxury sneakers market is concerned? Would you say it mirrors the growth of the luxury sneakers market here?
Our growth in Malaysia has been exceedingly fast-paced since entering the market in mid-2019. There is definitely a growing demand for the items we are selling on Novelship, and it isn’t just limited to luxury sneakers, it includes sneakers from famous brands such as Air Jordan, adidas Yeezy, and Fear of God to name a few.
The global market for sneakers is growing rapidly as a whole, and our own growth in Malaysia definitely reflects this.
What’s the rough percentage of sneaker sales on Novelship out of the total, which also includes other streetwear?
Sneaker sales still make up the vast majority of our sales in any given time period, we’re looking at around 80% to 90% of our transactions coming from this vertical.
Moving forward a major goal of ours is to diversify our offerings and move into limited edition apparel and collectibles from brands like Supreme, Palace, Bearbrick, and more.
Help us understand, is buying and reselling luxury sneakers counted as “scalping”? Where does one draw the line between it being “scalping” and “just a business”?
As technology has progressed, the many ways of acquiring limited edition items has become far more complex. In the past, large resellers would work directly with retail employees to reserve stock at a slightly elevated price and then flip their inventory throughout the local community.
Nowadays, a lot of inventory is released online and bought-up using bots, essentially simple programs developed by users that monitor websites like Nike SNKRS and quickly buy-up inventory as soon as it is released, and because they are buying at retail prices they earn higher profit margins on average.
Generally, the community is quite divided in terms of their opinions here, a lot of collectors hate resellers, and a lot of resellers are also collectors themselves, using their resale funds to fuel their hobby and collect more. Some will consider this business and others will blame companies like Nike for not putting a stop to these practices. At the end of the day it really depends on who you’re speaking to and their recent success or losses copping the sneakers they want. One thing that’s undeniable is the brands themselves have definitely benefited from the rise of resale, increasing their sales exponentially over the past half-decade or so.
How do you think platforms like Novelship have revolutionised the luxury sneakers scene? How have such platforms helped erase the scene’s less-than-stellar reputation, i.e. scams and underhanded dealings?
Platforms like Novelship have enabled consumers across Asia to get involved with sneakers in terms of the culture of collecting and the culture of reselling. We see users that have been collecting sneakers since the first Air Jordans were released in ‘85; we also see secondary school students selling sneakers for pocket money and sometimes creating their own legitimate business empires.
All in all, before platforms like ours existed, local buyers assumed a lot of risk, buying from people in-person or on forms and Facebook Groups, this led to a lot of mistrust and fakes ending up in the market. At our core, we want to ensure that all items transacted on the marketplace are legitimate, we’ve felt the pain of receiving a fake ourselves, that’s why we’ve invested heavily in hiring in-house brand experts and cutting-edge technology to ensure buying from us is safe and secure.
The market needs more transparency and trust to grow, and we feel immensely proud of the work we have done to contribute to this endeavour over the past few years. Going by our 1,100+ reviews on Trustpilot we’ve been doing it right it seems.
To find out more about Novelship, visit https://novelship.com.