NEW YORK (AP) — Shares of ThredUp rose 30% in their stock market debut Friday, reflecting investor enthusiasm for the online marketplace for second-hand fashion goods.
The stock market debut followed strong investor enthusiasm for Poshmark Inc., whose stock more than doubled to $101.50 valuing the company at $7.4 billion in its showing on Jan. 14. However, Poshmark's shares have come down dramatically since then and are down more than 60%.
Late Thursday, ThredUp's initial public offering of 12 million shares was priced at $14 apiece, the high end of its estimated range of $12 to $14, according to a statement by the company. That raised about $168 million before underwriting fees. The shares, opened at $18.25 late Friday morning on the Nasdaq Global Select Market under the symbol “TDUP." Shares ticked up to $18.48 by mid-day.
“I am thrilled with how the stock is being received, but it’s just one day and we have great years of opportunity in front of us," said James Reinhart, the co-founder and CEO of ThredUp, during an interview with The Associated Press Friday.
ThredUp's debut comes as the resales market has been strong, benefiting from shoppers' accelerated shift online and customers' steadfast focus on second-hand goods as they become more conscious about the environment. The total resale market reached $28 billion in 2019 and should increase to $64 billion by 2024, according to research from GlobalData commissioned by ThredUp.
ThredUp, based in Oakland, California, calls itself a “managed" marketplace, for sellers, including managing pricing, merchandising, fulfillment, payments and customer service. With this model, it believes it attracts high-quality supply without directly spending money to acquire sellers. ThredUp sellers can order a clean out kit, fill it and return it using the company's prepaid label. ThredUp then takes it and gets it ready for resale. In comparison, Poshmark is a social marketplace where users buy and sell directly with each other and interact,
Since its founding in 2009, ThredUp has processed more than 100 million unique secondhand items from 35,000 brands across 100 categories. Its facility has capacity to hold up to 5.5 million items and process up to 100,000 a day. As of Dec. 31, it had 1.24 million active buyers and 428,000 active sellers.
The company's revenue was $186.0 million in 2020, up 14% over 2019, according to its filing with the Securities and Exchange Commission. Its net loss widened to $47.9 million in 2020, from $38.2 million in 2019.