California’s The RealReal climbs after $300mn IPO

Bloomberg

Online luxury reseller The RealReal Inc rose 45 percent in its first day of trading after a $300 million initial public offering.
The RealReal’s shares, after rising as much as 50percent, closed up at $28.90 in New York trading, giving the company a market value of about $2.39 billion. The RealReal sold 15 million shares for $20 each after marketing them for $17 to $19.
The company, founded by Chief Executive Officer Julie Wainwright, makes it easier to sell and buy used luxury items such as clothing, accessories and jewellery on consignment by providing a platform for transactions and verifying that the goods are authentic.
Shoppers, especially millennials, are thinking more about sustainability and what happens to their clothes,” Wainwright said.
“It was like a drumbeat when we started,” said Wainwright. “Now it may not be the first reason they buy, but it’s the second.”
Internet-based apparel resellers like The RealReal, ThredUp Inc and Poshmark Inc have emerged as trendy alternatives to the secondhand clothing market. The RealReal focusses on luxury apparel items from designers like Hermes and Louis Vuitton, catering to the high-end fashion market, while ThredUp and Poshmark feature lower-priced items.
Used clothing, footwear and accessories represent a $10 billion market in the US, according to data from market research firm IBISWorld. While the market is intrigued by its growth, RealReal has yet to make a profit.