Fashion Resale Marketplace Poshmark Reportedly Eyeing IPO

We’ve all made those fashion purchases when we love something at first, but eventually, want it out of our closet.

Sites like Poshmark were created to give consumers a way to resell higher-end fashion-related items and get some of their money back. Now the fashion resale marketplace company is reportedly preparing to file for an IPO that could take place as early as this fall, according to the Wall Street Journal who cited “people familiar with the matter.”

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Poshmark has tapped Goldman Sachs Group Inc. and Morgan Stanley as its underwriters, according to the WSJ.

The Redwood City-based company has raised about $153 million since its inception in 2011. Its last funding round, an $87.5 million Series E announced in November 2017, gave it a valuation of $600 million, according to its Crunchbase profile. Backers include Mayfield Fund 1, Menlo Ventures, Temasek Holdings and GGV Capital.

Poshmark now potentially joins the ranks of startups (such as ride-hailing company Uber and photo-sharing site Pinterest) planning to go public this year as Crunchbase News has covered here and here.

Poshmark “generated close to $150 million in revenue and posted narrow losses last year,” according to the WSJ. Its valuation has climbed to about $1.25 billion since some shareholders recently sold shares via a secondary transaction, the Journal went on to say. But the company believes its public market value will top that figure, according to the paper’s sources.

Part of the beauty behind Poshmark’s model is that the company doesn’t have much overhead in the way of merchandise. Like eBay, it works as a facilitator between buyers and sellers, who post photos of their items on the Poshmark site. It makes money by charging a commission on each deal.

Poshmark isn’t the only company in the space looking to leave the private markets. WSJ also reported that The RealReal, a San Francisco-based luxury consignment shop, has also “met with investment bankers to prepare for a possible IPO that could happen this year.” TheRealReal has raised about $288 million since it was founded eight years ago, according to its Crunchbase profile. Most recently, it secured a $115 million Series G last July.

Illustration: Li-Anne Dias