Jump to content
Search In
  • More options...
Find results that contain...
Find results in...
Welcome Guest!

Join us now to get access to all our features. Once registered and logged in, you will be able to create topics, post replies to existing threads, give reputation to your fellow members, get your own private messenger, and so, so much more. It's also quick and totally free, so what are you waiting for?

BLACK LIVES MATTER! ×
BLACK LIVES MATTER!
Sign in to follow this  
NelsonG

Poshmark is pushing into the public market at a high-end valuation as the resale market sizzles

Recommended Posts

Poshmark, the nine-year-old, Redwood City Ca.-based online marketplace for second-hand clothing, beauty, and home decor products, is set to start trading as a public company on the Nasdaq tomorrow after tonight pricing 6.6 million shares higher than originally planned, according to Bloomberg.

Per its report, the company, which earlier expected to sell shares at between $35 and $39 million, saw enough demand to rationalize a $42-per-share price — one that values the company at $3.5 billion on a fully diluted basis.

Given investors’ feverish embrace of all kinds of newly public consumer brands, including Airbnb, DoorDash and, to a more moderate degree, Wish (trading currently where it opened when it hit the market in mid-December), most industry observers anticipate smooth sailing for the company as it makes the move from private to publicly traded company.

It has numerous things going for it.

More than 70 million Poshmark users having sold more than 130 million items through the platform since its inception, according to the company. And its revenue is moving in the right direction. Poshmark makes money off commissions on peer-to-peer sales and on products that it sells via wholesale, and it turned profitable last year for the first time. According to its S-1, it produced net income of $21 million off revenue of $193 million during the nine months ended September 30, 2020, compared with a net loss of $34 million on revenue of $150 million during the same period in 2019.

Also, unlike many brick-and-mortar retail businesses that were hit especially hard by pandemic-related shutdowns  — J. Crew, Neiman Marcus, and Brooks Brothers are just a few of many to declare bankruptcy — Poshmark only facilitates transactions between buyers and sellers, so it doesn’t have the burden or expense of holding inventory.

Not last, resale platforms of all stripes have the wind at their back right now. Resale can be more affordable. It can be a means for sellers to make money. More, shoppers are more interested than ever in sustainability, and buying someone else’s never- or lightly-used items is more environmentally friendly than supporting, say, a fast fashion brand. (Forever 21, the fast-fashion mall staple, filed for bankruptcy in 2019.)

What Poshmark has to overcome includes improving the customer experience, if a variety of review sites is to be believed. The company consistently receives poor marks for its quality control and support service.

Though profitable, it’s not yet terribly profitable, which may need to change, and quickly.

Poshmark, which has raised $153 million from its venture investors, is also challenged with making public market investors understand how it differs from already publicly traded rivals like eBay and The RealReal, which went public in 2019 and whose current market cap is roughly $2.3 billion. It will also need to differentiate itself from other companies hot on its heels.

Indeed, one of its closest rivals, ThredUp, filed a confidential registration statement with the SEC for an IPO last fall around the same time that Poshmark did.

Techcrunch?d=2mJPEYqXBVI Techcrunch?d=7Q72WNTAKBA Techcrunch?d=yIl2AUoC8zA Techcrunch?i=c-f8dyypO6s:1SHWj1kpyo4:-BT Techcrunch?i=c-f8dyypO6s:1SHWj1kpyo4:D7D Techcrunch?d=qj6IDK7rITs
c-f8dyypO6s

View the full article

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • Our picks

    • Wait, Burning Man is going online-only? What does that even look like?
      You could have been forgiven for missing the announcement that actual physical Burning Man has been canceled for this year, if not next. Firstly, the nonprofit Burning Man organization, known affectionately to insiders as the Borg, posted it after 5 p.m. PT Friday. That, even in the COVID-19 era, is the traditional time to push out news when you don't want much media attention. 
      But secondly, you may have missed its cancellation because the Borg is being careful not to use the C-word. The announcement was neutrally titled "The Burning Man Multiverse in 2020." Even as it offers refunds to early ticket buyers, considers layoffs and other belt-tightening measures, and can't even commit to a physical event in 2021, the Borg is making lemonade by focusing on an online-only version of Black Rock City this coming August.    Read more...
      More about Burning Man, Tech, Web Culture, and Live EventsView the full article
      • 0 replies
    • Post in What Are You Listening To?
      Post in What Are You Listening To?
    • Post in What Are You Listening To?
      Post in What Are You Listening To?
    • Post in What Are You Listening To?
      Post in What Are You Listening To?
    • Post in What Are You Listening To?
      Post in What Are You Listening To?
×
×
  • Create New...