There are so many variables with this guy's business model based on what I read, most of which seem logical.
This guy seemed to be dealing with something similar to an adjustable rate mortgage in a sense. It's like when some homeowners sign up for an adjustable rate mortgage instead of a fixed rate mortgage because the interest rates are astronomically lower during a set period in the early part of the loan, but the interest rate eventually inflates exponentially to correspond with the current market interest rate after the set period ends to the point where the borrower can no longer afford to keep making payments, which leads to foreclosure.
This guy's business seems to resemble that loan concept, but the only difference is he dealt with shoes through an ordering type of business instead of having a property with a mortgage attached to it in a sense.
Based on all the stuff I read on here, it seems like this guy got overzealous in assuming he could cover all those orders he took, but he got overwhelmed and clearly couldn't fulfill all the orders placed with him. He wanted his money fast but didn't anticipate the magnitude of what he wasn't capable of fulfilling. The problem stems from him not having the merchandise in his possession legitimately because he had to bank on being able to secure the goods from other sources. He basically bit off more than he could chew for sure.
His disadvantage was that he wasn't an authorized dealer with a Nike account who would be able to secure a set quantity of goods. His whole business was basically a gamble on all angles.
People don't believe there is money to be made on some of these gr Jordans but there is.
A 40k flip even if it took 6 months is better than any of the wins you would've gotten in the market unless you timed it extremely well.
The irony about my experience is I thought the same way for YEARS. There are mentions of Zadeh on this site /in this section specifically going back to at least 2017.
After years of seeing the name and thinking "damn this **** still popping" I finally took the leap last year.
Reputation is fluid tbh. Nice kicks was once a fake site now they have a reputation of being a reputable sneaker media company.
I been buying shoes online for nearly 20 years (I think my first pair was paid for via money order with instyleshoes). While it's nice to take such a strong stance on unauthorized retailers we've all more than likely spent at least some money with a shop or "seller" that doesn't exactly have a Nike account.
That's why I don't resell, I just don't like the fact that it's not a fixed rate and it's all about timing and demand, which I have no patience for. I don't have the space to hoard shoes to resell either. That's why I just stick to getting a pair for myself to keep and wear occasionally as long as it matches something.
Now if I could make over 90% profit per sale, then I sure as hell would be reselling the hell out of shoes! But that's only wishful thinking realistically.
You got me on that one because I have bought outside of a traditional retailer because I can recall I got a couple pair of Nike LeBron X off eBay several years ago. And I haven't bought shoes off eBay since then. I'd rather just stick with my retail option with releases and not retroactively get shoes from other outlets or sellers outside of standard retail.
I can proudly say I've never bought from a secondhand shop with jacked up prices in my life. And it will remain that way until I die.
Red flags for me go up when a dude starts taking preorders for rumored releases months in advance. People don't even know stock allocation or how easy they will be to get. It tells me, he just wants your money and I'll worry about the rest later.
This is exactly how crooked sellers do it online. They'll take money for orders with goods they don't actually have in their possession, then they'll try to fulfill the order by trying to obtain the goods illicitly or whatever crooked way they can.
These kinds of bogus sellers basically just deal with anticipation on all ends of their operation.
I'm not sure if this has already been posted, but there definitely hasn't been enough attention paid to this point that there's a
criminal investigation going on. I wonder what crimes are being investigated?
Here's my guess, based on following this thread since it opened:
This guy Zadeh has a business where he takes pre-orders at a set price and then fulfills those orders at market price some time in the future. So he's essentially short-selling hype sneakers, hoping that he'll get enough pre-orders on shoes that tank in value to make a profit and keep going. Then, the sneaker boom happens and all of the sudden he's having a harder and harder time making a profit, and he eventually starts taking big losses on stuff like Travis Scott's that didn't really exist when he started this. He knows that as soon as he stops fulfilling orders the whole thing will cave in, so he covers his losses the only way he can - taking more and more orders. Eventually it catches up to him and he realizes that there isn't gonna be another big payday to save him, so he calls it quits and dissolves his LLC. Everybody and their cousin put in a Paypal claim, some for hundreds of thousands, and this obviously raises red flags at Paypal, who then call the feds and report a possible case of fraud. This is big money, so the feds take it seriously and investigate.
While I'm not a law expert, all the legal fallout with this guy and his business model can be considered wire fraud because he took money that was wired to him online for merchandise he didn't actually have. And to compound the problem, he didn't deliver the goods he claimed to have after he collected money from a mass amount of people. It can be deemed that he stole money by doing it online.
This is definitely a matter for the FBI because he used the internet to steal money from many people from across the country. This necessitates FBI involvement because state lines were crossed and money was involved since he was swindling people across several states via world wide web instead of doing it with physical locations and interactions.
I can speak on what I've seen with Zadeh. Could be two things: 1) Small profit is better than no profit, 2) Most likely: To get the more exclusive sneakers in bulk, Zadeh use to have a preferred list of customers that got first dibs on it and every one else was SOL. From what I've heard, you had to spend a good amount of money on bulk to get to that list. Could be he was setting up for the future with this order.
This all seems like a pyramid scheme involving shoes in a way.
Unfortunately, that's why people and businesses like this who are predatory exist because they can prey on peoples' desperation or unnecessary wants for material goods that will eventually be perishable regardless of whether they're worn or not.
This guy and his business was destined to fail because both sides, the seller and the buyers, were basically dealing with anticipation and estimations as opposed to having clarity with numbers and quantities on both ends.
just looking at him. The V neck with the baby chain. The typical hypebeast setup in the background. The guy tried to sound smart saying he knows all types of scams while also sounding completely stupid for falling for this one 
.
