\n<\/p>\n
Think quick \u2014<\/span> how much does a top-of-the-line iPhone 15 Pro Max cost? If you said around $1,600, you\u2019d be right, but only if you\u2019re based in the U.S. In Turkey, the same phone will set you back almost $3,000<\/a>. That gap introduces a fantastic opportunity for arbitrage \u2014 and a lively second-hand and refurbished market. Getmobil<\/a> just raised $4 million to legitimize phone refurbishing inside the country.<\/p>\n \u201cThe Turkish government wants to decrease the trade deficit,\u201d explains Mehmet Uygun, CEO and founder at Getmobil. \u201cThe government wants to create a circular economy. They don\u2019t want the customers to buy brand new phones, because whenever a customer buys a brand new phone, the dollar goes out of the country.\u201d<\/p>\n Global economics and trade policy is deeply fascinating, and can cause some really weird quirks in local mobile phone markets. In 2010, for example, Argentina introduced a set of rules that meant that if you wanted to sell products in the country, you\u2019d have to manufacture there. That had a ton of strange effects; English-language books became almost impossible to buy or insanely expensive (I remember paying $65 for a hard-copy of Walter Isaacson\u2019s biography of Steve Jobs<\/a> in a Buenos Aires book store \u2014 which sold for about $29 in the U.S. at the time). It also meant that Apple yeeted out of the market altogether, choosing not to sell its iPhones in Argentina. And suddenly, long after everybody else had more or less forgotten BlackBerry even existed, the phone brand had a resurgence in the country when it decided to build an assembly plant there<\/a>.<\/p>\n The same thing is happening in Turkey at the moment; Turkey, desperate to keep its GDP within the country\u2019s borders, has put a hefty import levy on phones. It\u2019s not easy to get around those limitations either \u2014 if you sneak a phone into the country, its IMEI<\/a> will be blocked from the three major networks after 120 days.<\/p>\n The Getmobil team outside of its headquarters and repair lab. Image Credits:<\/strong> Getmobil<\/p>\n<\/div>\n Obviously, people still need phones, but, unwilling or unable to pay the incredibly high import taxes, they seek other solutions. Getmobil had its humble beginnings as a modest phone repair shop, and has since evolved into one of the leading e-commerce platforms in Turkey, specializing in the sale of refurbished electronics.<\/p>\n The lead investor, the slightly confusingly named Dutch Founders Fund<\/a> (DFF), invested in Getmobil\u2019s.\u00a0\u201cWhile DFF is based in the Netherlands, our focus at DFF lies in investing in B2B marketplaces during their seed phase,\u201d says Hidde Hoogcarspel, co-founder and managing partner at DFF. \u201cOur portfolio companies are not only located across Europe but also in regions such as Dubai and Egypt. These marketplaces typically operate across borders and sometimes even globally.\u201d<\/p>\n As the Getmobil founders navigated the complexities of the electronics repair market, they identified a significant gap between the high cost of brand-new devices and the consumer\u2019s desire for more economically viable alternatives. This realization prompted a pivot away from merely repairing devices to refurbishing and selling them, thus laying the groundwork for what would become Getmobil\u2019s core business model.<\/p>\n In putting up high tariffs, the Turkish government created a grey market: People were selling and buying phones with cash, none of which was reported to the government. The good thing was that the money stayed within the country\u2019s borders, but obviously, nobody was collecting taxes along the way, so that caused a new problem: Yes, the money was circular, but none of it was leaking into the country\u2019s tax coffers.<\/p>\n \u201cTurkey is an absolute outlier refurbished market. The price of a new iPhone in Ankara is far higher than in any other place in the world. The government has created a unique and far-reaching regulatory framework and incentive scheme, and imports are limited,\u201d explains Hoogcarspel. \u201cThe formal refurbishing sector in Turkey is still in its early stages; the informal<\/em> trade is thriving and is estimated to surpass the entire market size of $7 billion for new device sales. Tens of thousands of merchants operate within this informal segment.\u201d<\/p>\n Eager to get the situation under control, the government brought in some big changes, including some new regulations, tax incentives and opportunities. In 2021, Turkey introduced a set of regulations that significantly bolstered the refurbished electronics market, creating a more structured and reliable framework for companies operating within this sector. These regulatory changes were framed as encouraging sustainable consumption practices, enhancing the quality and reliability of refurbished devices and reducing the environmental impact of electronic waste.<\/p>\n \u201c[The Turkish government] introduced a refurbishment center regulation. They said \u2018if you build the refurbishment center with some specific standards, we will not take 20% in taxes, we will take 1%,\u201d explains Uygun. In addition, the government made it possible for the vetted refurbishment centers to offer installment payments \u2014 rather than having to pay for the devices in full. That\u2019s extraordinary, the founders explain, because consumer credit is highly regulated in Turkey. They say that Apple cannot offer installment plans.<\/p>\n Getmobil\u2019s growth trajectory has been remarkable, driven by a combination of strategic foresight, operational excellence and a deep understanding of the Turkish electronics \u2014 and regulatory \u2014 market. The company\u2019s rise is characterized by its ability to offer consumers high-quality, refurbished electronics at competitive prices, thereby filling a critical market gap. This value proposition helped endear Getmobil to consumers, and has positioned the company as a vital player in Turkey\u2019s electronics sector. And, presumably, the government is excited to be one step closer to being able to regulate the out-of-control second-hand market.<\/p>\n While there\u2019s little doubt that the main driving force behind the government\u2019s regulations is revenue, forcing a more robust repair and second-hand market has a number of positive side effects, such as a dramatic increase in usable life of devices, and a significant reduction of e-waste.<\/p>\n Before the regulations, the refurbished electronics market in Turkey was chaotic and fragmented, and the quality and warranty coverage of second-hand devices was highly variable. The new frameworks put in place established stringent standards for refurbishing processes, including quality checks, warranty requirements and after-sales services. This legislative environment has played a pivotal role in leveling the playing field. By playing ball with the government\u2019s regulations, Getmobil bought itself an edge \u2014 by promising to stick to the rules, adhering to high standards of quality and customer service, the company got itself a tremendous competitive advantage.<\/p>\n By aligning the interest of the customers (cost and quality), the government (ability to keep money inside Turkey, and collecting some taxes along the way) and Getmobil, everybody wins. Reusing, repairing, refurbishing and recycling extends the circular economy to a broader user base and means that the environment gets a little boost, too.<\/p>\n Navigating the intricacies of Turkey\u2019s electronics market presents a unique set of challenges and opportunities for Getmobil. The team tells TechCrunch that the pervasive black market continues to be a big challenge: This shadow economy not only undercuts prices of legitimate refurbished electronics but also often compromises on quality and after-sales services, posing a significant threat to consumer trust. Moreover, staying abreast of and compliant with the evolving regulatory environment in Turkey adds another layer of complexity to Getmobil\u2019s operations.<\/p>\n Of course, the first step toward suppressing the black market was creating an alternative for it, and that\u2019s where the regulations and Getmobil\u2019s round of funding comes in.<\/p>\n For the investors, it remains to be seen whether this is a good investment. DFF clearly believes that there\u2019s a huge opportunity here, but in the process, it is investing in a business that\u2019s essentially made possible by a government regulation that suppresses cross-border trade. Turkey isn\u2019t a member of the EU (conversations stalled out over alleged human rights violations perpetrated by the Turkish government<\/a>), but if it were to become a member, the entire business model for Getmobil falls apart: EU countries cannot impose trade tariffs<\/a> for cross-border imports and exports, and without that, it\u2019s easy to imagine the Turkish market getting flooded with used and new electronics priced the same as in the rest of the EU.<\/p>\n Whether or not Getmobil\u2019s future is secure depends entirely on geopolitical events and the direction of tomorrow\u2019s trade tariff winds.<\/p>\n<\/p><\/div>\nWhere there\u2019s friction, there\u2019s opportunity<\/h2>\n
Winners: Local economy and the environment<\/h2>\n
Dependent on regulation<\/h2>\n