Caitlin Young is one of millions of teenagers and 20-somethings who are shaking up the fashion industry by digging out their parents’ cast-offs, raiding charity shops and scanning boot sales to build mini businesses online.

Young picks up 1990s and “Y2K” early 2000s “vintage” gear from charity shops and jumble sales and then styles or customises them for her 22,500 followers on Depop, a fast-growing social media app which combines the image creation of Instagram with a digital version of market trader bargaining.

“People in my family say, ‘You sell used shoes?,’ like they are so disgusted, but everyone I know buys vintage. It’s what people do now,” says Young. “It pays for my life,” adds the animation student, who sells up to £2,000-worth of secondhand clothing a month online.

Facebook Twitter Pinterest Caitlin Young: ‘People in my family say, you sell used shoes? – like they are so disgusted.’ Photograph: Martin Godwin/The Guardian

Young and other online clothing sellers are shrugging off the trends shovelled out by mainstream brands and high street chains and making thousands of pounds by trading vintage trainers, fluorescent hoodies and high-waisted jeans their parents wore to raves in the 1990s and early 2000s.

Founded in 2011, Depop now has 10m users, most of whom are in the UK, and takes more than £300m ($400m) a year in sales, a figure that has doubled year on year. Its British shoppers, 80% of whom are aged 13 to 24, buy an average of 20,000 items a day. It reckons that hundreds of its top sellers make more than £150,000 a year selling online.

Depop has caught on to a trend in which secondhand is no longer second best, along with other online marketplaces including US-based Thredup, Poshmark and Grailed, which trade in a more social way than the more established eBay and Gumtree. The online fashion specialist Asos’s marketplace section includes vintage boutiques, while British startup Student High Street holds sellers’ events at universities.

A study in the US by Thredup suggested there was a 25% rise in the number of women prepared to buy secondhand in 2017 compared with the year before. It predicted 15% annual growth in the market over the next few years. compared with just 2% for the overall fashion sales.

Thredup estimates that secondhand clothes now make up 6% of respondents’ wardrobes, double that of 10 years ago, and that proportion could almost double again to 11% by 2027.

“It’s almost a dark market,” says Lorna Hall, the head of insight at the trend forecasting firm WGSN. “Money is coming out of the mainstream market because of this way of shopping, particularly in Generation Z [under 25s].”

“People love that you can easily search for people selling on Depop who are close to you, pick up your purchase and avoid postage costs,” she says.

Simon Beckerman founded Depop in Italy in 2011 but moved the company to London three years ago after winning $8m in backing from Balderton Capital, the UK-based investment firm which has previously backed Betfair and Figleaves.

Beckerman told Artefact magazine his initial goal was to aim for “young designers and cool collectors … but we discovered this world of girls who want to sell their whole wardrobe and I didn’t imagine there would be such a need for that. Ebay is complicated, long and, if you want to sell something for £5, it just doesn’t work. So having Depop as a social marketplace with chat is better and all the girls love it”.

Facebook Twitter Pinterest Depop has about 10m users. Photograph: Linda Nylind/The Guardian

The 2008 recession sparked a change in attitude that has been embraced by young people who want to be fashionable but are concerned about the environmental impact of throwing away clothes after only a few wears.

“We are living in an age of DIY and the rise of being able to create your own platform,” says Depop seller Thidarat Kaha, who sells about £6,000 of clothes a month to her 44,000 followers. “The mainstream market used to be just buying something from Topshop, and someone else would have that same dress.

“The magic of this product is it is usually one on one. No one else is going to get anything else exactly the same as what you just purchased. And young people are more conscious about the future of the planet. Recycling and buying vintage clothing is contributing to to consuming clothes in a better way.”

Depop is aiming to tap into that change in mentality to quadruple the size of the business in the next three or four years.

In total, $40m has now been ploughed into the company by investors betting on that future, including Octopus Ventures, the company that backed Graze and Gym Box and Creandum, that backed Spotify and the payment tech firm iZettle.

“We are so small compared to the overall size of the market, the potential is huge,” says Maria Raga, Depop’s chief executive. “Depop is about people selling stuff that is good quality, inspirational and that is down to a lot of creativity.”

Young, who began by making and selling clothes to friends at school and used to sell vintage items on eBay before joining Depop as a student, says she has had such a good response to her customised clothes that she is now considering launching her own clothing brand. “I started it to keep me going while I’m studying, but I just love it,” she says.