Online consignment startup ThredUP raised $175 million in a new round of funding led by Park West Asset Management and Irving Investors, the company announced Wednesday.
It also revealed that it had received a “previously undisclosed $75 million investment” last year, bringing its total funding to $306.1 million, according to Crunchbase data. ThredUP did not give further details on the $75 million investment.
Its last disclosed venture round before the newly announced investment, its Series E led by Goldman Sachs, raised $81 million in September 2015.
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The fashion resale space is one that’s heating up as more consumers go online to buy and sell clothing and accessories. ThredUP calls itself the “world’s largest fashion resale marketplace,” with 35,000 brands available at up to 90% off retail prices.
ThredUP competes with Redwood City’s Poshmark in the area. Poshmark, which has $153 million in total funding, last raised $87.5 million in its Series E round in November 2017.
Poshmark is reportedly looking to go public, according to an April 2019 report from the Wall Street Journal. The company had nearly $150 million in revenue and “narrow losses” last year, WSJ reported.
It wouldn’t be the first fashion resale startup to go public this year—another notable competitor, The RealReal, went public in June after raising $358 million in venture funding.The company had a valuation of $990 million when it was private, and it is now valued at $1.06 billion. Its stock, which had an all-time high of $28.90 when it began trading on June 28, was trading at $17.22 on Wednesday afternoon. (The company’s equity was recently re-priced as the market digested trade concerns and recession jitters.)
The three companies, while related, don’t do exactly the same thing. The RealReal specializes in luxury consignment goods, whereas Poshmark and ThredUP mix both low-end and high-end items. The RealReal has a team of authenticators who verify that every item accepted for consignment and sold by the company isn’t a knockoff. Poshmark offers authentication as a premium service and ThredUP authenticates items that are sent to the company as part of its LUXE program.
ThredUP’s fresh round of funding follows its announcement last week that it would partner with JC Penney to bring second-hand clothes and accessories to JCP’s retail stores. ThredUP items will be available at 30 JC Penney stores, and the startup started offering its items at 40 Macy’s locations since the beginning of this month as well.
With the new cash, ThredUP is starting what it calls “resale-as-a-service,” where retailers and brands can partner with the startup to add inventory to their own stores and websites, according to a Medium post announcing the funding. Retailers will also be able to issue “Clean Out Kits” to shoppers who turn in clothes they don’t want anymore to ThredUP for shopping credits.
With one company public and the other two richly-valued and well-funded it will be interesting to see which is the next of the three to file for an IPO.
Illustration Credit: Li-Anne Dias
Correction: We misinterpreted thredUP’s previously undisclosed $75 million investment and added it to its total funding. The total funding and chart have been corrected. We regret the error.
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