When it comes to used clothing retail space, $20 million can go a long way.
Online consignment shop Swap.com announced on Thursday morning that it has raised $20 million to fuel nationwide growth.
This news rounds out an already exciting year for the pre-owned clothing purveyor. This summer, Swap announced that it was expanding its marketplace to include menswear. Although headquartered in Bolingbrook, IL, Swap also recently established a presence in downtown Chicago.
Chief Marketing Officer Rich Lesperance said the company is aggressively hiring for positions both in its Bolingbrook headquarters and its downtown Chicago offices.
“We’re just getting started,” said Lesperance. “We’re looking especially for talent in digital marketing and data analytics.”
Lesperance said a solid data analytics operation will be crucial to the company’s work to bring the right consumers to its inventory of 1.5 million “unique, one-of-a-kind items.” One of its key strategies for doing so in a scalable manner is to let consumers set up email alerts for when new inventory arrives that fits specific size, style and brand requirements.
“It’s all the joy of thrifting, but you can quickly drill down to things that will fit you,” said Lesperance.
The company said it has grown at an average rate of 180 percent year-over-year since its launch.
One of Swap.com’s main goals in the upcoming year is to raise awareness among consumers across the country. It will also use part of the funding to increase efficiency in its 360,000 square foot Bolingbrook fulfillment center.
"As an industry, we're only scratching the surface," said CEO and co-founder Juha Koponen in a statement. "There's a staggering amount of unused, pre-owned merchandise with an estimated value of more than one hundred billion dollars annually. And while there is a large demand for secondhand items, the merchandise has not been moving mostly because there hasn't been a practical nor convenient way to purchase these items online.”
Swap.com sees online consignment as an environmental opportunity as well as a financial one. Environmental Protection Agency estimates say the average American discards 70 pounds of useable textiles annually, adding a total of 25.5 billion pounds of waste to the country’s landfills.
“This is going to be the best year yet, in terms of how fun it will be to bring all these people in and tackle this problem that really needs to be tackled in the United States,” said Lesperance.
The funding round was led by Swedish equity group eEquity. According to the equity group’s website, its portfolio primarily consists of e-commerce companies headquartered in Sweden and Finland. (Swap.com was acquired by Finland-based Netcycler in 2012, but the company’s operations have since been consolidated under the Swap.com brand and moved to the United States.)
“We are proud to invest in Swap.com and its outstanding management team that we believe have a unique opportunity to become a clear category leader in the United States,” said eEquity Partner Patrik Hedelin in a statement. “We strongly believe in the value proposition of Swap.com and look forward to people increasing the life span and extracting value of their pre-owned quality apparel via Swap.com with a positive impact on the environment as well.”
Image via Built In Chicago.