Last year, many of us began to wonder when the online fashion resale startup bubble was going to burst, with investors repeatedly pouring millions into largely similar companies despite the amount of competition in the space. Well, it hasn't burst yet. On Tuesday, leading European luxury resale site Vestiaire Collective announced that it had raised a whopping €58 million — about $62 million at the current exchange rate — bringing its total funding to date to €116 million, and making it one of the most-funded resale startups in existence. The round of funding was led by new investor Vitruvian Partners, who have expressed an increased focus on French companies according to a press release issued by Vestiaire.
While Vestiaire, founded in 2009, has affirmed a leading position in Europe, it hasn't quite risen to the top here in the U.S., where it faces competition from sites like The Real Real and Poshmark. Not all startups have survived in this competitive space, however — there were many more just a few years ago. With this massive cash injection, it's pretty clear that the company intends to become an online resale leader worldwide, and thus it plans to devote a significant portion of that $62 million towards accelerating growth in the U.S. market (in addition to other regions such as Asia), which it entered in 2015. And it may be worth it.
According to Samina Virk, Vestiaire's head of U.S., the company has actually grown more quickly in the U.S. than it did within its first three years of launching in its native Europe. She tells Fashionista that the post-investment strategy stateside will be to increase brand marketing, scale the U.S. team (keep an eye out if you're looking for a job!) and operations, improve service and support growth by opening up a new office in New York that's three times the size of its previous space. "As we grow, my priority is to stay true to the core French DNA of our brand, while offering American women access to the best closets around the world," she wrote in an email. "Our expansive global catalogue and international community is a truly unique offering that separates us from our competitors in the U.S." In other words: users are able to buy luxury handbags and the like from vendors located overseas.
Vestiaire is really going to have to push that international angle if it wants to get ahead of the competition stateside; otherwise, it's not terribly different from San Francisco-based The Real Real, which also focuses on authenticated luxury goods, has raised a comparable $122 million thus far, and has said it's eying an IPO.