(Reuters) – Shares in the US online luxury reseller in The RealReal, Inc., a REAL.D) a jump of 40% in its debut on Friday, giving a market cap of $2.32 billion, signaling a growing interest from the investment community for a summary of the consumer’s business.
Julie Wainwright, (C), chief executive officer of The RealReal, Inc. to take part in the company’s initial public OFFERING at the Nasdaq MarketSite inside Times Square in New York, New York, united states of america, the 28th of June, 2019 at the latest. REUTERS/Lucas Jackson
The shares opened at $28, above its offering price of $20.
The offering of 15 million shares was priced at $20, above the expected range of $17 and $ 19 per share, with the help of the company’s board of directors to raise $300 million in net cash proceeds.
The RealReal, which specializes in the sale and purchase of second-hand luxury items, such as clothing and accessories, it was set up by the company’s Chief Executive Officer, Julie Wainwright in 2011.
People can take their unwanted luxury merchandise, some of which may be used or still have the tags, and the company then takes a cut when a sale is made.
The RealReal, which started out as a business run by Wainwright to the kitchen table, and now processes up to 2 million contracts. It has expanded its physical presence by opening two brick-and-mortar stores in new york and one in Los Angeles is that the collection and sale of the property.
The company is flourishing on rising sales of used and vintage luxury goods from Chanel handbags as well as Designer dresses to Rolex watches – in banking on the growth of the millennial interest in the price and the environmental advantages of recycled clothing.
The personal luxury goods market is expected to grow to $364, and $415 billion a year by 2025, with millennials expected to represent 40% of the market, according to research firm Bain & Co.
The rival traders were looking to cash in on the fast-growing market, including thredUP, which branched out into the luxury, last year, and the well-established companies such as Vestiaire Collective.
The RealReal at the end of March, about 620,000 authenticated pre owned luxury goods in the marketplace bearing the mark of more than 5,500 luxury and premium products.
The top-selling luxury designer-The RealReal, the online marketplace, include: Cartier, Chanel, Christian Louboutin, Gucci, Hermes, Louis Vuitton, Prada, Rolex, Tiffany’s, and Valentino.
The company reported a net loss of $75.8 million by 2018, compared to a net loss of $ 52.3 million in 2017, with a revenue of $207.4 million, an increase of more than 55%, the filing with the U.s. Securities and Exchange Commission showed.
Investors in the San Francisco-based company, Perella Weinberg ners and Great Hill ners.
Reporting Aparajita Saxena and Aishwarya Venugopal, Bengaluru; Editing by shailesh Kuber