The used clothing sales platform Vinted has closed for 250 million euros which has been led by EQT Growth, with previous investors including Accel, Burda Principal Investments, Insight Partners, Lightspeed Venture Partners and Sprints Capital.
After this new investment, Vinted has reached a valuation of 3,500 million of euros, quadrupling the level that marks the frontier of startups ($1,000 M, about €825 M) and which it exceeded in 2019, just before the pandemic: a situation that has given a special boost to circular economy platforms , that is, those where users play the role of both consumers and sellers.
Vinted, the second-hand clothing marketplace gains new momentum
Surely you remember Vinted, the Lithuanian that in 2019 was , the Spanish app in which users bought and sold each other those clothes that they no longer needed, which meant the disappearance as a brand of this popular virtual fashion market.
This same model that facilitates the transaction between the purchase and sale of second-hand clothing is the one that has made Vinted stagger, and in fact has a story similar to the one that Nono Ruiz and Laura Muñoz lived when they gave life to the app of “las guapis” .
Vinted was founded in 2008 by Milda Mitkute and Justas Janauskasand was created as a way to help Mitkute clean up her wardrobe before moving house, an idea that quickly spread but in 2016 had to change her business model.
After recouping much of what was invested in its costly international expansion strategy, the company eliminated all existing fees on its platforms to encourage its users to create their catalogs. Vinted now charges buyers a 5% commission only if a transaction is made on their platform, along with buyer and shipping protection to make this deal more attractive.
And boy did the change work since two years later, in 2018, he managed to raise 50 million in financing, while In November 2019, the company closed one for 128 million euros, with which its valuation reached the milestone of 1,000 million dollars succeeding in becoming a
Currently Vinted is present in 13 markets: , Germany, Belgium, Spain, Italy, Netherlands, Austria, , Czech Republic, Lithuania, Luxembourg, and USA) and now will use this new injection of resources to double its reach and deepen its penetration in a market as competitive as the United States.
The company has around 45 million users who upload their catalogs of clothing or household items to sell on their platform, as well as to buy from others, despite having completely stopped operations during the first two months of the pandemic in 2020.
From fast fashion to the circular economy: the approach of taking care of the economy and the planet
For years, the second-hand clothing market or circular economy has been increasing, gaining momentum in recent months both due to the economic crisis in various regions of the world and the awareness of being more responsible and caring for the planet, an ideal ecosystem for the growth of these platforms.
While Europe is home to some of the world’s largest companies, such as H&M, Zara and Primark, it is also home to a thriving second-hand clothing marketespecially during the last 12 months in which people have been spending more time at home tidying up spaces, or looking to earn extra money, save, or simply rethink how the world works and get involved to make it better.
As such, the circular economy also moves big figures: in November 2020 it was estimated that the fashion within the circular economy of more than 4 billion euros. In Europe it is estimated that two out of three people have bought some second-hand garmentwhile 6 out of 10 have sold using this type of circular economy platform, and in fact Vinted has not been the only one to capitalize: recently raised 157 million euroswhile we must also remember that eBay was a pioneer in the circular economy that despite the fact that it is now presented more as a marketplace where brands also have a presence, it has shown great momentum in its second-hand model in the last quarter.
“Vinted is transforming the second-hand fashion market across Europe through its customer-centric approach and extraordinary execution.” assured Carolina Brochado, growth partner at EQT. “It’s the perfect example of EQT Growth’s strategy of supporting fast-growing European tech champions capitalizing on several macro trends, such as growing consumer demand for sustainability.”
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