The second-hand clothes marketplace ‘Vinted’ has raised $140 million in Series-E at a value of over $1 billion. Founded and headquartered out of Vilnius, Lithuania, this used clothing startup is the first tech unicorn popping from the tiny east European country.
The second-hand clothes market is thriving in Europe for the past several years. The factors like economic crunches and fewer wasteful trend selections are the main factors behind the rise of this business. E-commerce websites that deal with selling and buying second-hand products have worked as a catalyst in enhancing the net worth of this industry, dubbed as the “circular economy.”
Vinted is an online platform for selling and buying used clothes and accessories. It was created by Milda Mitkute and Justas Janauskas in 2008, after which they got the media’s attention, investor’s interest, and the idea overall went viral. Its offices now are based in 4 locations, i.e., Vilnius, Berlin, Warsaw, and Prague. The company is working across 12 countries, including the UK and the USA.
The online used-clothing retailer has raised today €128 million (~ $140 million) in a funding round that was being led by Lightspeed Venture Partners, and the previous backers like Sprints Capital, Insight Venture Partners, Accel, and Burda Principal Investments. This massive funding valued it at more than $1 billion, a milestone for any startup.
Vinted CEO’s Plans About Newly Received Funding
The company worked well, but its sales decreased in 2016. It is the time when Thomas Plantenga joined it as CEO and overhauled Vinted’s business model. While talking to TechCrunch, he said, “We changed the business model in 2016 to make the costs as low as possible for users to list clothes. That produced a dramatic change in our growth trajectory.”
“However, our focus is firmly on accelerating our growth across Europe and providing the best possible product to our members — and we will increase our investments to support this growth.”, the CEO added.
The real question!
Back in 2018, the company raised €50 million; its revenue has increased 4x in the past 17 months since then, but their profit not really. The company is eagerly spending on marketing. In 2018 they had spent €42 million but earned €32.9 million. As per Bloomberg, Pantenga is looking forward to Vinted’s expansion in Europe, building out more e-commerce features on its platform and increasing further investments.
Moreover, Vinted is still dependent on funding and is not able to have an IPA. It was able to acquire a lucrative investment as two of the Lightspeed’s partners have close links with Vinted, including Bradley Twohig, who was a Vinted board member for moving to Lightspeed and Rytis Vitkauskas who invested in Vinted before joining Lightspeed.
This funding history makes it seem like Vinted would thrive in the coming years and would unlock new levels of investment.
Featured image: Vinted
