Vinted, the leading online platform for secondhand fashion, has successfully raised €340 million in a funding round led by TPG, valuing the profitable Lithuanian startup at €5 billion. This significant investment comes as Vinted plans to expand its offerings beyond clothing into electronics and other categories, marking a pivotal shift in its business strategy.
Vinted recently reported a remarkable 61% increase in sales, reaching nearly €600 million, which has propelled the company into profitability for the first time. This growth has been attributed to its expansion into new markets, including Denmark and Finland, as well as its entry into the luxury fashion segment through the acquisition of the high-end resale site Rebelle in 2022.
The company’s CEO, Adam Jay, emphasized that Vinted's model has evolved significantly since its inception. The removal of seller fees in 2016 was a game-changer, allowing users to sell items without incurring costs, thereby attracting a larger user base.
With over 39 million euros in annualized Gross Merchandise Value (GMV) reported from recent expansions, Vinted is well-positioned to capitalize on the growing trend of sustainable shopping.
With the new funding, Vinted aims to diversify its product categories. While fashion will remain at the core of its offerings, the company is exploring opportunities in electronics and potentially other consumer goods. This strategic pivot is designed to attract a broader demographic, including those who may not typically engage with secondhand fashion but are interested in buying and selling used electronics.
Jay noted that Vinted's mission is straightforward: to make secondhand the first choice for consumers worldwide. He believes that this expansion will not only enhance Vinted's market presence but also contribute positively to sustainability efforts by promoting the reuse of products across various categories.
As Vinted prepares for this expansion, it faces increasing competition within the secondhand market. Rivals like Depop and RealReal have struggled with profitability despite their popularity. However, Vinted's recent financial success positions it favorably against competitors who have yet to achieve similar milestones.
The rise of "pre-loved" fashion has gained mainstream traction, driven by consumer awareness of sustainability and cost-effectiveness. Reports indicate that global sales of pre-owned clothing surged significantly last year and are projected to continue growing rapidly over the next few years.
Vinted’s latest funding round not only underscores its robust financial health but also signals an ambitious roadmap for future growth. By diversifying its offerings and enhancing user experience through innovative services like Vinted Go—its logistics solution—the company is set to redefine the secondhand marketplace landscape. As it continues to champion sustainability while expanding its reach, Vinted is poised to become a dominant player in both the fashion and broader resale markets.