Fashion Sites Nomorerack, Rent the Runway Raise Funds
Christmas is coming early for two web-based fashion startups in New York, often referred to as the Target and the Netflix of online shopping. Nomorerack, the Target counterpart, is a discount e-commerce site that said on Friday it has raised $12 million in Series A financing, led by Giosis Gmarket, a large Asian e-market company based in Singapore.
On the same day, Rent the Runway—the Netflix-like site, which allows customers to rent clothes and accessories online—said it had received $20 million in new funds, in part from Advance Publications, parent company of Conde’ Nast.
Nomorerack was founded in 2010 in Vancouver with private funds and moved to New York six months ago. The site offers nine or more deals a day, with mark-downs that average 70 percent to 90 percent of retail list prices, and says in its press release that it has 5.8 million members and 7 million visitors a month—marking a growth rate of 200 percent in the last month.
Giosis Director Ifty Ahmed, who is also a partner at Oak Investment Partners, will join the Nomorerack board. The startup’s founder and CEO, Deepak Agarwal, said in a statement that Nomorerack was approached “by a number of venture capital firms,” but chose instead “strategic investors who have deep domain experience and can add the most value to our customers, with an emphasis on helping to source more high quality-low cost products.”
As for Rent the Runway, the three-year-old company previously raised $31 million. Those initial investors— Bain Capital Ventures, Highland Capital Partners, and Kleiner Perkins Caufield & Byers—are also part of the latest round of financing, while Conde’ Nast President Bob Sauerberg will join Rent the Runway’s board as part of this deal.
The site allows customers to rent designer clothes, shoes, and other accessories for four days at a time, at rates that typically equal 10 percent of the retail price. Rent the Runway says it has over 3 million members.