As fashion resale has grown tremendously in the last five years, it was inevitable that consolidation was coming. Following Etsy’s acquisition of Depop in June, Paris-based luxury reseller Vestiaire Collective announced on Tuesday that it acquired American resale company Tradesy for an undisclosed sum.
The acquisition makes Vestiare Collective one of the widest-reaching resale companies, with a combined audience of 23 million members globally, 4 million of which Tradesy contributed. Comparatively, competitor The RealReal has 24 million members, only just beating out Vestiaire Collective.
Vestiaire Collective has traditionally focused on the European market, but in the last two years, it has grown its U.S. sales by 75% per year, according to the company. It mainly attributed the growth to increasingly aggressive U.S.-targeted marketing.
“With this transaction, we confirm Vestiaire Collective’s ambition to be a truly global player, promoting circularity in Europe, the U.S. and Asia-Pacific” said Max Bittner, CEO of Vestiaire Collective in an email to Glossy.
To support the new reach in the U.S., Vestiaire Collective is opening an authentication center in Los Angeles this year, marking its fifth in total and second in the U.S. after the first in New York City. The company will also form what it calls a “technology hub” in Los Angeles. In the office, resale technology — like using machine learning for product information – will be developed and deployed to the U.S. operations.
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This comes only a few months after Vestiaire Collective hired its first chief technology officer, Klemen Drole, in November. Technology and scale are two of the key components for a resale company to be competitive, and Vestiaire Collective is using this acquisition to improve both. Tradesy also has expertise in virtual inventory automation, something that Vestiaire Collective competitor The RealReal doesn’t do, according to Tradesy CEO Tracy DiNunzio.
Bittner will remain CEO of Vestiare Collective as a whole, while the founder and CEO of Tradesy, Tracy DiNunzio, will lead U.S. operations of Vestiare Collective. In an email to Glossy, DiNunzio and her team’s expertise was specifically mentioned by Fanny Moizant, founder and president of Vestiaire Collective, as something the company wanted to preserve.
Vestiaire Collective has attracted massive investment in recent years, bringing in more than $600 million since 2015 from companies including Condé Nast, Kering and SoftBank. Its current valuation is over $1.7 billion. Its valuation coupled with the renewed focus on growing in the U.S. market puts Vestiaire Collective in direct competition with its biggest rival, the American company The RealReal. Tradesy only recently raised $67 million in funding in September, bringing its total funds to nearly $170 million.
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The RealReal is also valued at over $1 billion, sells the same caliber of luxury goods as Vestiaire Collective and has similarly attracted investment from big companies like Great Hill Partners. But while Vestiaire Collective seeks to have a presence in both the U.S. and Europe, The RealReal has so far shown little interest in expanding outside of the U.S.
One area where The RealReal has an edge is in its Innovation Lab, a project set up to create its own clothes out of the recycled and upcycled pieces it collects that aren’t sellable on their own.
According to Ed Lavery, director of investor solutions at SimilarWeb, Vestiaire Collective had a 70% surge in new customers over the course of 2021. France, the U.K. and the U.S. are its three core markets, with the U.S. growing fastest in the last year.
