Online fashion marketplace Material Wrld raises $9 million
April 1, 2016 02:08 PM
Four-year-old luxury online consignment marketplace Material Wrld has raised a $9 million Series B funding round that will go toward developing the prepaid debit card it launched in October and offers to customers in exchange for their used luxury fashion apparel and accessories.
The round was led by publicly traded Japanese fashion e-retailer Start Today Co. Ltd., No. 53 in the 2016 Asia 500 Guide. Start Today operates fashion websites Zozotown.co and Zozo.jp. The company grew 28.7% in 2015 to $431.6 million in sales from $335.4 million in 2014, Internet Retailer estimates. Japanese investment firm Nissay Capital also participated in the round.
“This new round of funding will not only be instrumental in allowing us to grow faster while achieving profitability,” Material Wrld co-founders Rie Yano and Jie Zheng said in a joint statement. “We’ve been inspired by Start Today’s online platform Zozo.jp as pioneers in the world for offering customers a seamless experience to shop new and pre-owned fashions on one site.”
When customers send Material Wrld items they receive an email with an offer—a dollar amount—for the items. Customers have the option to accept or pass on the offer. When Material Wrld doesn’t accept items, customers have the option to have items returned or donated to Housing Works, a New York City-based charity that focuses on helping people with AIDS and the homeless.
Material Wrld began offering customers the reloadable prepaid debit card, called Fashion Trade-In Card, in October 2015, which is how the company pays customers for items they provide. On the company’s website, it says it pays shoppers selling through the site for their items via the card versus other means such as cash because that allows the e-retailer to offer greater payouts.
The card, which runs on the Discover Network, can be used at more than 700 online and in-store locations including Bloomingdale's (its parent company Macy's Inc. is No. 7 in the Internet Retailer 2015 Top 500 Guide), Nordstrom Inc. (No. 19) and Steven Alan. The card carries no fees, has no impact on credit scores and does not need to be connected to a bank account, the company says. Yano was not immediately reached for comment on how many shoppers have received the trade-in card so far.