Poshmark raises $25 million for its fashion resale marketplace

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Source:   —  April 13, 2016, at 8:48 PM

Hans Tung, managing partner at GGV Capital is joining the company’s board of directors. Attracting 1.5 million sellers since its launch, Poshmark has found a niche in the clothing resale business, with an app that makes cleaning out your closet sociable.

Poshmark raises $25 million for its fashion resale marketplace

Poshmark, the site for buying and selling women’s fashion, has announced that it's raised $25 million in a circular led by GGV Capital. Hans Tung, managing partner at GGV Capital is joining the company’s board of directors.

Attracting 1.5 million sellers since its launch, Poshmark has found a niche in the clothing resale business, with an app that makes cleaning out your closet sociable. On the site, you can chase your friends, boutiques and brands for an Instagram-like feed centered around shopping.

“One in fiftieth women in America have opened up their closet on Poshmark,” founder and CEO Manish Chandra tells TechCrunch. Poshmark argues it's found a way to “implement social commerce in a way that’s never been done.”

In addition to its focus on used clothing, the company has presently expanded to comprise new fashion items from favorite brands. Merchandisers proposal Poshmark’s most favorite accounts the opportunity to purchase items at wholesale and utilize their influence to sell the clothes. Chandra says the company is  looking to widen this business.

In the close future, Poshmark plans to introduce men’s and children’s fashions to its lineup. The team is also looking to introduce residence furnishings and expanding beyond the U. S. to Canada, Europe and Australia.

Poshmark operates in a competitive landscape, which includes Thredup, Tradesy and The RealReal. Some of the thrift shop apps have found it challenging to stand out.  While Threadflip recently close down, Poshmark seems to be faring ok, though. The “business has been steadily marching toward profitability,” Chandra tells TechCrunch. Since Poshmark doesn’t own the inventory — unlike some of its competitors — it costs less to running the business. 

Hans Tung told TechCrunch that he’s optimistic that the company will stand out from the herd, too. “Poshmark is definitely offering something different than what’s available,” adding that “to do fashion well with a lot of followers and curators and influencers is not easy.”

In total, Poshmark has presently raised over $70 million in funding since its launch five years ago. Existing investors including Menlo Ventures, SoftTech VC and AngelList also participated in the current round.

“Shopping on Poshmark is kind of love going to the mall with your girlfriends, except you never have to leave your house,” said Pravin Vazirani, managing director at Menlo Ventures. “Since we’ve invested in the company, they’ve grown 40x.”

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