Web start-up bideasi does not charge listing fees, meaning that sellers only pay for successful auctions.
Company MD Steven Fouracre said bideasi currently had 13,000 items for sale, three months into its launch, with a view to adding 30,000 in the next few weeks.
'We are talking to a major funder, which we hope will be able to fund advertising, marketing and PR work,' said Fouracre.
He added that eBay chief financial officer Bob Swan had been in touch regarding the startup. 'This shows the level of concern that even eBay has that bideasi will quickly eat into its market share,' claimed Fouracre.