This should be Poshmark’s moment. The online merchant is at the center of a burgeoning social shopping explosion, as a growing number of startups and social media firms promote creators as sellers of either new or used goods. For Poshmark, though, it’s more like the worst of times.

The company has been hit by the double whammy of Apple’s privacy clampdown, which has put a crimp in its advertising strategy, and intensifying competition from rival used-good sites like ThredUp and The RealReal. Revenue growth slowed to just 16% in the third quarter, down from 42% in the first quarter. A sharp increase in marketing costs put the company into the red. Less than a year after it went public, Poshmark’s stock has lost more than half its value, cutting its market capitalization to $1.4 billion.

The company’s performance raises a question about Poshmark’s business model, according to Kanwal Rekhi, managing director of Inventus Capital Partners, an early investor in Poshmark who was a board observer at the company from 2011 to 2019. He asks whether Poshmark’s social shopping features, which helped it amass more users than its competitors had, are hindering the company now. People logging onto the Poshmark app may be less motivated to shop than they are to browse and engage with other users as they would on a social media site, he said.