Vinted valued at €3.5bn after EQT-backed fundraising
Online used-clothing marketplace raises €250m as pre-owned fashion booms
Online second-hand clothing marketplace Vinted has raised €250m in a funding round led by Sweden’s EQT that valued the Lithuanian group at €3.5bn, underscoring growing investor interest in sustainable fashion.
The company, whose app allows users to buy and sell used garments, last raised funds in November 2019 at a valuation of €1.1bn. Thomas Plantenga, chief executive, said the jump reflected Vinted’s entry into new markets and the growth of sales on its app, along with a “very favourable” investment climate.
“When we did the last round, we were operating in France and Belgium and were off to a good start in Spain,” he said. “Now we are also running in markets like the UK and Italy and we’ve shown that we can enter new markets more quickly than before.”
He declined to give figures for the value of product sold on the app — the last available is €1.3bn for 2019 — or the revenue that the company makes from sellers’ fees and added-value services.
But he said that the proceeds will be used to enter new markets and further improve services such as payments and shipping. Previous investors including Accel, Burda, Insight Partners, Lightspeed and Sprints will also participate in the round.
Vinted is one of several ventures looking to bring used clothing into the mainstream, as younger consumers in particular become increasingly motivated by sustainability concerns over low prices.
Others include Depop, backed by investors including General Atlantic, and Vestiare Collective, in which French luxury group Kering owns a minority stake. US operator ThredUp floated on Nasdaq in March; its shares have since risen by 34 per cent.
Although the Covid-19 pandemic caused disruption in the clothing industry, especially in its early stages, it also led to a worldwide decluttering of wardrobes as people looked to recoup funds by selling their old clothes, bringing a wave of new sellers to online platforms.
Research by Boston Consulting Group last year suggested that the global pre-owned apparel market is worth up to $40bn a year, or about 2 per cent of the total, and that figure could grow by 15-20 per cent per year for the next five years. It also expects the “share of closet” taken by second-hand clothes to increase to more than a quarter by 2023.
Mainstream retailers such as Sweden’s H&M, online operators Asos and Zalando, and even UK supermarket chain Asda have also begun to experiment with second-hand fashion.
But Plantenga said that in the long-term pre-owned clothing could yet account for half of the overall fashion market, and that he was unconcerned by the entry of much bigger players.
“We are in the early stages of this second-hand game . . . we are very happy to see the overall market get bigger”.