ThredUp looks to raise up to 168 million dollars in IPO

Fashion resale platform ThredUp is aiming to raise up to 168 million dollars in its upcoming IPO.

The US company said Thursday it plans to sell 12 million shares of its Class A common stock at a price of between 12 dollars and 14 dollars, the upper range of which would raise 168 million dollars and value the business at around 1.3 billion dollars.

The San Francisco-based company plans to list on the Nasdaq Global Select Market under the ticker symbol ‘TDUP’.

ThredUp is one of the pioneers in the fast-growing resale market, which in recent years has been driven by increasing consumer awareness over the damage the fashion industry - and particularly fast-fashion - is having on the environment.

Resale continues to grow

According to ThredUp’s most recent annual report published in June, the second-hand market is expected to hit 64 billion dollars in the next five years and overtake the fast-fashion industry by 2029.

The IPO comes after Redwood City, California-based rival Poshmark went public back in January.

The two companies are tapping into the same second-hand market with different business models. While Poshmark takes commissions on peer-to-peer sales - in other words, it doesn’t hold an inventory - ThredUp uses a consignment model. The company sends its users “Clean Out bags” which they fill with their unwanted items. It then receives the bags and sells them through its platform, giving the user a percentage of the price.

Despite the pandemic, ThredUp reported a 14 percent increase in revenue in the year ended December 31, 2020. However, its net loss in the year widened to 47.9 million dollars compared to 38.2 million dollars the year before.

ThredUp raised 175 million dollars in funding in 2019, bringing its total raised to 340 million dollars from big-name investors including the likes of Goldman Sachs and Redpoint Ventures.

Since its founding in 2009, ThredUp has processed over 100 million unique second-hand items from 35,000 brands across 100 categories. The company estimates it has saved its buyers 3.3 billion dollars off the estimated retail price of their purchases.

Image: ThredUp