The article first appeared on the Business of Fashion.
LONDON, United Kingdom — Three years ago, Groupe Arnault, the family office of LVMH chairman and chief executive Bernard Arnault, joined venture firms Accel, Balderton and others to inject $40 million into fashion search platform Lyst.
Now, Lyst and LVMH are deepening their relationship with a new round of funding led directly by the French luxury conglomerate.
Lyst is raising $60 million of which LVMH has contributed roughly 45 percent, according to market sources. The round is closing in two parts, each worth $30 million. The second closing is currently being finalised. As part of the deal, LVMH chief digital officer Ian Rogers will join Lyst’s board.
Before this latest investment, Lyst — essentially a digital shopping mall that aggregates millions of fashion products from brands, department stores and boutiques under one virtual roof — had attracted $60.5 million in funding, putting the total sum the company will have raised to date following the completion of the current round at about $120 million.
Lyst hit a gross merchandise value of $325 million in the year to March 2018, according to the company, and Morton said gross merchandise value is “approaching half a billion dollars this year.”
The business takes a commission on sales, implying actual revenues of much less than that. In the year to March 2018, Lyst generated $21 million in net revenue. The platform became EBITDA positive in December 2017 and was “very close to EBITDA break even for the whole year,” said Morton.
Lyst plans to use the new funding — and tap LVMH’s deep international expertise — to drive global expansion. Currently, 60 percent of Lyst’s revenue comes from the US, 30 percent from Europe and 10 percent from Asia, but Lyst was only available in English until the recent launch of a French site.
The London-based start-up plans to launch in Germany and Spain next. “That’s not just language, but a globalised experience that’s in tune with local market dynamics, because the French customer is clearly different from the British customer or the American customer,” explained Morton.
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