Farfetch, the UK-based fashion e-commerce platform backed by media group Advance Publications and e-commerce firm JD.com, went public on Friday in an initial public offering that raised approximately $885m.
The company issued just over 33.6 million shares on the New York Stock Exchange while its shareholders sold an additional 10.6 million. The shares were priced at $20 each, above the IPO’s $17 to $19 range, giving it a market cap of about $5.8bn.
Founded in 2008, Farfetch operates an online marketplace for luxury and high-end fashion items, selling pieces from almost 1,000 producers to a 2.3 million-strong customer base worldwide.
Farfetch increased revenue 55% year on year to almost $268m in the first half of 2018, though its losses increased from $29.3m to $68.4m over the same period.
The company had raised approximately $702m in funding altogether. Founder and CEO José Neves owns 42.9 million class B shares while Farfetch’s other shareholders all hold class A shares.
Advance Publications first invested in Farfetch in 2013 when subsidiary Condé Nast led the company’s $20m series C round, which included Advent Venture Partners, Index Ventures and E.ventures.
Vitruvian Partners led a $66m series D round for Farfetch in 2014 that was also backed by Condé Nast, Advent and Richard Chen, before the company added $86m from Condé Nast, Vitruvian and DST Global the following year at a $1bn valuation.
That valuation grew to $1.5bn when Farfetch secured $110m in a mid-2016 series F round co-led by IDG Capital, Eurazeo and Singaporean-government owned investment firm Temasek, and backed by Vitruvian.
Kadi Group, a subsidiary of JD.com, invested $397m in Farfetch in June 2017, and it acquired just over 1.4 million shares in the offering, equating to a $28.1m investment, though its proportion of Farfetch’s class A shares has fallen from 19.4% to 17.2%.
Advance’s share of the class A shares was diluted from 7% to 6%, while Novel TMT, the corporate venturing vehicle for telecommunications firm Novel Group, sold just over $3m of shares in the offering and will retain a small shareholding.
Advent sold $54.6m of stock and now owns 9.9% of the class A shares while Vitruvian sold $49m and retains 8.9%, and DST divested $44.2m and retains 5.1% of the class A shares. Index Ventures’ stake was diluted to 11.5% of the class A shares post-IPO.
Goldman Sachs, JP Morgan Securities, Allen & Company and UBS Securities are joint lead book-running managers for the IPO while Credit Suisse Securities (USA), Deutsche Bank Securities and Wells Fargo Securities are joint bookrunners. Cowen and Company and BNP Paribas Securities are co-managers.
The underwriters have a 30-day option to buy an additional 6.64 million shares, which would increase the size of the offering to almost $1.02bn. Farfetch’s shares debuted at $27 on Friday and closed at $28.45, a 42% increase on its IPO price.