Naver, the South Korean search large, in the present day announced it plans to accumulate secondhand attire market Poshmark for $1.2 billion in money. The deal values publicly-traded Poshmark’s shares at $17.90 — a 15% premium over in the present day’s closing value — and the businesses count on it to shut by Q1 2023, topic to approval by Poshmark stockholders and “the satisfaction of sure different customary closing situations.”
Assuming the transaction goes via, Poshmark will turn out to be a standalone subsidiary of Naver led by CEO Manish Chandra and Poshmark’s present administration group. It’ll proceed to function beneath its present model, Naver says, and keep its employees, consumer base and headquarters in Redwood Metropolis, California.
In a press launch, Naver and Poshmark lay out a number of arguments as to why the deal is sensible for each events. By buying Poshmark, Naver plans to mix the service’s rising social buying platform, the place customers purchase and promote used attire, with its “technological prowess” and present communities, like the web discussion board Naver Café. As for Poshmark, it stands to profit from Naver’s picture recognition and search applied sciences, which Naver says will enable the buying platform to supply new discovery and advice experiences that permit customers discover attire by looking colours, designs and supplies and determine the place to seek out merchandise by scanning garments utilizing their smartphone cameras (a la Google Lens).
Naver additionally touts its sturdy ad-serving and funds infrastructure, averring that Poshmark will have the ability to leverage it to higher analyze gross sales statistics and serve worldwide clients. The long-term plan is to, with Naver’s backing, develop Poshmark’s enterprise into extra developed markets in Asia and elsewhere the place Naver has vital holdings — partially by integrating a few of Naver’s stay buying providers with the Poshmark platform. On the similar time, Poshmark will assist Naver to determine a stronger U.S. foothold inclusive of the stateside properties the tech large already owns, like digital comics portal Webtoon Leisure and on-line story platform Wattpad.
Naver optimistically predicts the acquisition might develop Poshmark’s annual income “past” 20% and save the corporate $30 million in annual run fee inside two years.
Poshmark CEO Manish Chandra mentioned in a press launch:
The chance to hitch forces with Naver — one of many world’s main and most modern and profitable web corporations — is a testomony to the power of our model, working mannequin and what we’ve constructed during the last decade with our proficient group and wonderful group. Our business continues to evolve at a speedy tempo, and we’re excited to proceed to steer the way forward for buying by offering our group with an unparalleled expertise that’s easy, social, enjoyable and sustainable. This can be a extremely compelling alternative for our staff, who will profit from being half of a bigger, world group with shared values and complementary strengths. This transaction additionally delivers vital and quick worth to our shareholders. Long term, as a part of Naver, we are going to profit from their monetary assets, vital expertise capabilities and main presence throughout Asia to increase our platform, elevate our product and consumer experiences and enter new and huge markets. I look ahead to partnering with Naver as we take our firm into its subsequent section of development.
Naver CEO Choi Soo-Yeon mentioned:
The mixture will create the strongest platform for powering communities and re-fashioning commerce. Poshmark is the definitive model for trend in the US that gives a social community for purchasing and promoting attire. Naver’s main expertise in search, AI advice and e-commerce instruments will assist energy the following section of Poshmark’s world development. Poshmark is a pure match for our enterprise — our two corporations share a typical set of values and imaginative and prescient round content material, group and empowerment. Bringing Naver and Poshmark collectively will instantly put us on the forefront of making a brand new, socially accountable and sustainable buying expertise designed round sellers of all sizes and pursuits — from particular person and influencer sellers to skilled sellers, manufacturers and specialty boutiques — and a big, loyal and extremely engaged social group. We’re excited to work intently with Manish and his proficient group to create lasting worth for all our stakeholders.
Poshmark’s exit comes over a decade after its founding in 2011. Chandra — alongside Tracy Solar, Gautam Golwala and Chetan Pungaliya — began the corporate in Chandra’s storage, funding it partially with the proceeds from the gross sales of Chandra’s earlier firm, social buying startup Kaboodle, to Hearst. Previous to its itemizing on the Nasdaq at a valuation of over $3 billion, Poshmark raised greater than $160 million in enterprise capital from VC companies together with Temasek, Menlo Ventures, GGV Capital and Mayfield.
Poshmark claims to have over 80 million registered customers. However in recent times, the corporate has carried out unpredictably, reporting a loss for 2021 of $44.4 million after raking in a $25.2 million revenue in 2020.
