US-based fashion rental service Rent the Runway has gone public in a $357m initial public offering representing an exit for backed by media group Advance Publications and payment services firm American Express.
The company increased the number of shares in the offering from 15 million to 17 million and issued them on the Nasdaq Select Market priced at $21.00 each, at the top of the IPO’s $18 to $21 range.
Rent the Runway is the owner of an online platform which allows customers to rent high-fashion items through a subscription service.
The company had disclosed $553m in funding pre-IPO, most recently securing $81.2m in a May 2021 series G round that included Ares Corporate Opportunities Fund, Highland Capital Partners, Bain Capital Ventures and TCV.
The last three had all taken part in a $135m series F round for Rent the Runway that closed in January 2020. That in turn followed a $125m round in early 2019 featuring Franklin Templeton Investments, Bain Capital Ventures, Hamilton Lane and funds and accounts advised by T Rowe Price at a $1bn valuation.
Advance Publications had joined investment and financial services group Fidelity, Bain Capital Ventures, TCV and Highland Capital in the company’s $60m series E round in 2016.
Rent the Runway had previously received $60m in a 2014 series D round backed by Advance Publications, Bain Capital Ventures, Highland Capital and TCV in 2014 valuing it at $520m.
American Express, Advance Publications, Bain Capital Ventures, Highland Capital Novel TMT Ventures and Kleiner Perkins Caufield & Byers had supplied $24.4m in series C funding for Rent the Runway the previous year.
The company’s largest external shareholders are Bain Capital Ventures, which owns 13.6% of its class B shares post-IPO, Highland Capital (8.5%), TCV (6.2%) and Ares Corporate Opportunities Fund (5.4%).
The lead book-running managers for the offering are Goldman Sachs, Morgan Stanley and Barclays Capital while Credit Suisse Securities (USA), Piper Sandler, Wells Fargo Securities, JMP Securities and KeyBanc Capital Markets are joint book-running managers and Telsey Advisory Group is co-manager.
The underwriters have a 30-day option to acquire up to 2.55 million additional shares, potentially increasing the size of the IPO to over $410m.
