Manchester, UK-based e-tailer Boohoo.com may not yet have the name recognition in the U.S. of some other fast-fashion companies. But as it's — no exaggeration — one of the fastest-growing apparel businesses in the world, that's likely to change, especially after Thursday's news that it has raised £50 million ($65 million) from investors to fuel more rapid growth via the construction of a new UK warehouse. Boohoo says the new warehouse, planned to cost £150 million to build over the next three years, will span 600,000 square feet and can provide more than £2 billion of additional net sales capacity.
The 11-year-old company has the momentum to back this up and draw investors in. Total revenue in the first quarter of fiscal 2017, for instance, grew a whopping 106 percent to £120.1 million. Boohoo brand revenue, individually, grew 48 percent overall and a significant 97 percent in the United States. The company also said that revenue for Nasty Gal — Boohoo.com's recently acquired former competitor — has seen month-to-month growth since it bought the Los Angeles-based retailer out of bankruptcy in January. UK-based Prettylittlething.com, which Boohoo acquired last December, was also said to have exhibited strong revenue growth. The company expects overall revenue to grow 60 percent — not 50, as previously predicted — in the fiscal year ending next February. It brought in £294.6 million last year. According to the Telegraph, it expects to hit £3 billion in annual sales within seven years at an average yearly growth rate of 45 percent. Shares in the company have almost quadrupled in value over the past year.
Boohoo.com is known for, and is an investor favorite because of, its ability to upload hundreds of new products a day, its hold on 16-to-24 year olds, and its nimble production capabilities and "test-and-repeat" business model: It will stock only a few of a new style or trend, and then buy deeper if it performs well. "Within 48 hours of something going live, we have a good idea as to how many weeks we should run that style for and what kind of depth we should buy into it," explained co-founder Carol Kane in an interview with Fashionista back in 2015.
In addition to the new facility, Boohoo says the fundraise will also help it "take advantage of investment opportunities as they arise," meaning more acquisitions could be on the horizon.