Poshmark (POSH) is an attractive option for investors seeking exposure to a growing e-commerce industry. In this video from "The Virtual Opportunities Show" recorded on Jan. 25, Motley Fool contributor Rachel Warren introduces the stock to listeners and names a few reasons why it's worth buying.

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Rachel Warren: The stock I wanted to just talk about, it's actually when I've been looking at a little more closely lately and it's one I covered on the show a few weeks back. That's Poshmark and I feel like this is a stock that doesn't get a lot of attention. But in the world of virtual opportunity stocks as well as companies that I think have a lot of potential that are trading on sale right now. This was one that came to mind. Poshmark is a recent IPO stock. They became a publicly traded company in January of last year. The company was founded a decade ago, back in 2011, a little over 10 years ago. They have over 80 million community members spread across North America, Australia, they recently expanded into India as well. What's interesting is I had always thought of Poshmark is basically just a place where you can resell your used clothes and you can't do that, but there's actually a lot more to the business besides that aspect.

There are actually a marketplace not only for women, kids, and men's fashion and accessories, both new and used, but you can also buy new personal care products on there, you can buy select home goods, you could buy pet items. You can even buy electronics. One example I've given before, you can find on there actually found a used MacBook Pro 13-inch for $380 and a new one I think retails for something like $1,500. Really, a wide array of items that are sold on there. Poshmark makes money in a very simple structure. If you're going to sell something on Poshmark, you can list that item for free. Then after that item sells, Poshmark then takes a fee from the order price. If the item you are selling is under $15, they have a flat take rate of $2.95.

Then for sales that are above $15, they have a take rate of 20 percent and then the seller keeps 80 percent. They have a lot of perks for sellers to get on the platform. They give you a free pre-paid shipping label, free credit card processing. They have a lot of buyer protection and things like that. The company has launched a lot of programs in recent years to attract more buyers and sellers to its platform, which is booming. One of the things they've done, I found was really interesting was they have entered into a partnership with Snapchat, which allows users to explore different products and attend what's known as Posh Parties, basically selling parties on the Snapchat app. In the company's most recent quarter, which would've been third-quarter, we don't have their fourth-quarter and full-year report out yet. Gross merchandise value on the platform, that was up 18 percent year-over-year.

Total revenue was up 16 percent year-over-year. Net revenue was a total of $68.8 million in the third quarter of 2020. The company is still operating at a loss but that is not something that's really unusual given that it's growing its business really fast. It's in that earlier phase post IPO, it does have a really strong liquidity position and had about 589 million in cash equivalents and marketable securities on its balance sheet at the end of the most recent quarter. But just to give an idea of how many people are using Poshmark.

This was Poshmark's 2020 social commerce report. I'm hoping they'll release one for 2021 because I'm really interested to see what those updated stats are. But at the time of this report, which was released for the year 2020, 38 million items were shared on Poshmark per day. There were 1.8 million likes of the products that took place on the Poshmark platform per day and 365,000 comments on Poshmark per day. In addition to that, all of the sellers on Poshmark in 2019, 48 percent of those sellers used a portion of their earnings to then go ahead and make another purchase on Poshmark in the same year. You've got this constant flow of money that's going back into the platform from the people that are using it to sell old items or maybe launched their own side business or even a full-time selling business on there. There's a lot of opportunity with this company.

Stock is down about 80 percent since its IPO, I think a year ago, although when I checked today, shares were up two percent for no particular reason that I could note. But I think it's one to look at. It's not one of the most talked about stocks in the e-commerce space, but it just have really solid and easy to understand business structure. I like the way its platform naturally lends itself to capital going back into the platform. I think it's one to watch, at least put on your radar.