Farfetch, the London-based technology platform for luxury fashion, has just filed its F-1 for IPO on the NYSE with a proposed maximum offering size of $100 million. The company has applied to have its Class A ordinary shares listed on NYSE under the ticker symbol ‘FTCH’. In the latest filing, the number of shares and offering price has not been published so we cannot make any valuation comparison in this initial IPO analysis. As soon as the company updates its filing we will update our analysis with valuation comparison against relevant peers.
Farfetch is a technology platform for the global luxury fashion industry that connects brands, retailers, and consumers in what the company characterises as a fragmented market. The company was founded 10 years ago and has established an interesting position in the global fashion industry, worth $307 billion in 2017 and expected to grow to $446bn by 2025 according to Bain. The majority of revenue is generated through the Farfetch Marketplace connecting around 2.3m consumers with 980 luxury sellers.
As with many other online retailers, Farfetch has acquired a foothold in the physical world by acquiring Browns, a British fashion and luxury goods boutique, in May 2015. Browns operates two retail fashion boutiques in London. The company has 3,000 employees with two-thirds of its workforce employed in Technology & Product and Operations.
As of December 2017 the company had 936,000 active customers, up 44% year-on-year,and revenue was $386m in 2017, up 60% y/y. According to Bain, the luxury market grew 6% annualised since 2010 with online luxury fashion growing 27% annualised in the same period. The online market share in luxury fashion is around 9% and thus far lower than most other retail markets.