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Kering And Tiger Global Management Invest In Resale Platform Vestiaire Collective

Kering And Tiger Global Management Invest In Resale Platform Vestiaire Collective

Romana Hai
Kering And Tiger Global Management Invest In Resale Platform Vestiaire Collective

Global resale platform Vestiaire Collective has closed a $216 million investment round, backed by global French luxury group Kering (KER.PA) and U.S. investment firm Tiger Global Management.

After growing over 100 percent year-over-year, the fashion resale platform is looking to further accelerate its growth and drive change for a more sustainable fashion industry through its latest investment round.

“This latest round of investment confirms the incredible trajectory of Vestiaire Collective, founded during the 2008 crisis, the model has clearly demonstrated its ability to continue to thrive during challenging conditions,” said Maximilian Bittner, Vestiaire Collective’s CEO.

“The resale sector as a whole is experiencing rapid growth, especially amongst Millennial and Gen Z consumers, which will come to shape the retail landscape of the future. We are incredibly excited to welcome Kering and Tiger Global Management, both of which will be instrumental in our mission to build a more sustainable fashion industry and further grow our incredible global community”.

As part of the deal, Kering has acquired a 5 percent stake in Vestiaire Collective and the luxury group now holds a seat on the resale platform’s board of directors. The deal underpins Kering’s interest in tapping into the booming luxury resale market.

“Pre-owned luxury is now a real and deeply rooted trend, especially among younger customers. Rather than ignoring it, our wish is to seize this opportunity to enhance the value we offer our customers and influence the future of our industry towards more innovative and more sustainable practices. This fits naturally with our entrepreneurial spirit, our pioneering sustainability strategy, and our modern vision of Luxury,” said François-Henri Pinault, Chairman and CEO of Kering.

Demand for pre-owned luxury products has skyrocketed since the start of the pandemic. Vestiaire Collective, for one, saw a 33 percent increase in daily listings, with consumers changing where and how they shop. Consumers are now not only more budget-conscious but are also embracing sustainability. It has become increasingly clear to conglomerates such as Kering that these shifts in consumer behavior are more than a passing trend and have, in fact, become a new way of life.

“Our innovation strategy aims at investing in brands and technologies for the next generation of consumers, focusing on disruptive business models that allow us to better serve our clients and improve our performance. The investment in Vestiaire Collective makes full sense from both perspectives,” said Grégory Boutté, Kering’s Chief Client and Digital Officer.

Kering And Tiger Global Management Invest In Resale Platform Vestiaire Collective
Source: Vestiaire Collective

Meanwhile, U.S.-based technology investor Tiger Global Management will bring its knowledge and experience of supporting high-growth tech platforms such as Facebook and Spotify to the board and will help accelerate Vestiaire Collective’s global expansion efforts.

“We are excited to support Vestiaire Collective’s continued global expansion plans, which focus on seizing the momentum of already spectacular growth in the United States and Asia Pacific. As of January 2021, local sellers in those regions had increased their items sold by more than 250 percent year-over-year,” said Griffin Schroeder, Partner, Tiger Global.

What’s next

With its latest round of funding, Vestiaire Collective plans to encourage reuse, reduce waste and extend the lifespan of pieces through a new ‘Brand Approved’ service, a buy-back circular solution for brands. The service just made its debut through a collaboration with Alexander McQueen. Through the program, the fashion house has selected a group of clients to offer store credit in return for garments, accessories, and shoes from previous collections.

Vestiaire Collective also plans to continue to support and amplify the voice of its global community through efforts such as the ‘Fashion Activist’ badge, which encourages consumers to engage in a ‘1 in, 1 out’ behavior and through other service offerings such as direct shipping service and the ‘Follow the Leaf’ program, which makes shoppers aware of their most sustainable options.

The company has also noted that buying second-hand via Vestiaire Collective can reduce the environmental impact by up to 91 percent. That said, the company plans to become carbon neutral by 2026 and plans to continue driving consumer awareness through continued educational campaigns and partnering with renowned fashion activists.

And last but not least, Vestiaire Collective is looking to become a B Corp certified business, encourage its employees to engage in 15 hours of community work and launch a diversity & inclusivity task force.

The company’s latest investment round was supported by several shareholders, including Vestiaire Collective’s CEO Max Bittner, Bpifrance (Large Venture), Condé Nast, the Eurazeo Group (Eurazeo Growth and Idinvest Venture) (RF.PA), certain funds managed by Fidelity International, Korelya Capital (backed by NAVER) (KRX: 035420), Luxury Tech Fund (LTF & Cuir Invest) and Vitruvian Partners.

Goldman Sachs served as strategic advisor and private placement agent to Vestiaire Collective.

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