China’s online dress rental platform MSParis, on Thursday, announced that it has raised a US$18 million series A round led by Northen Light Venture Capital, with participation from Matrix Partners China, existing investor China Growth Capital and a number of international fashion brand investors.
“In 2016, the apparel industry in China has a market size of several trillion RMB, this shows that it is already a mature sector in the e-commerce industry,” said Jiang Haotian, the managing director at Northen Light Venture.
“But over the past ten years, the industry has faced several problems including high return rates, inventory risks, and low online customer volume. Yet again, MSParis’ innovative business model manages to optimize the operating model and supply chain, which is the main reason why we are optimistic about MSParis,” Jiang adds.
Northern Light Venture Capital is a China-focused venture capital firm targeting early stage opportunities of innovation and disruptive technology. Since its inception in 2005, Northern Light has backed over 180 ventures.
Established in 2015, Shanghai-based MSParis allows users to rent top brand and luxury women’s dresses ranging from Vera Wang, Valentino to Lavin, Hermes etc. at up to 90 to 95 percent discounts on the purchase price.
The company targets the so-called gold-collar workers in the financial and media industry who may require high-end evening dresses and other formal attire regularly. However, in March 2016, the dress rental platform expanded its range of clothing from its initial focus on high-end evening gowns to include daily apparels as well.
“The platform initial strategy was to build up an acceptance of MSParis brand image based off evening gowns Expanding into everyday wear, on the other hand, is aimed at converting our customers into long-term users, as well as to enhance the company’s cash flow,” said the founder of the MSParis, Xu BaiZi who is christened Paris.
Following the completion of the financing round, MSParis will also welcome two new talents into their management team. One will be in charge of the firm’s strategy-making while the other is responsible for the supply chain management. Additionally, Meikailong products VP will also join the company over the same period.
MSParis also claims that within a year of its inception, its new clothes on average manages to recover their cost within s 2 months period, while 20 percent of their customers has paid a few thousand in RMB to upgrade into an annual membership status.
The clothing rental platform has a 3000 square meters integrated warehousing and laundry center that can complete their complete their retrieval, cleaning, and distribution process within 5 hours.
By Vivian Foo, Unicorn Media
This news is published on Reuters.